Ralco hydro power project, presently in the detailed design phase, will be the largest hydro plant built in Chile to date. Endesa (Empresa Nacional de Electricidad SA) is the owner of this project which is located in the upper part of Chile’s second largest river, the Río Biobío. The dam site is 35km upstream of Endesa’s Pangue hydro plant, which started operation in October 1996.

The main project features of Ralco are the 155m-high RCC dam, which will form a 34.7km2 reservoir. The power station is located approximately 10 river km downstream from the dam, and is connected to it by a 7km-long adduction tunnel. Construction, which is scheduled to start in 1998, will last for five years. Energy production should start in 2002 and the power produced in Ralco will be supplied to the central grid — corresponding to approximately 15% of the total electricity produced in Chile.

Environmental assessment

For projects of the type, size and importance of Ralco, Chilean legislation now requires an Environmental Impact Assessment (EIA); the corresponding law was made in March 1994, but the Chilean environmental impact assessment regulatory system did not become operational until April 1997. In anticipation of this, Endesa commissioned a voluntary EIA study in 1994. Terms of reference for this study have been formulated by Conama, the national environmental authority. The study was handed over to Conama in 1996 and, after their revisions had been made, the EIA was finally accepted in 1997.

The EIA report included a whole range of detailed studies, covering all aspects of the physical and biological environment as well as the socio-economic conditions and impacts of the project. It provides a detailed description of the prevailing situation, an assessment of impacts, mitigation measures adopted or to be taken, as well as an environmental monitoring and management plan. Since completion of the report, work on environmental and socio-economic aspects has been carried out, and it will continue to be of importance during pro-ject implementation and commissioning.

In general, every hydro power project must come to terms with the following environmental concerns:

•The dam will interrupt the normal river flow; this blocks the migration of aquatic organisms along the river, changes the river flow pattern in the downstream area, and reduces sediment load downstream of the dam.

•A lake is formed upstream of the dam, which presents completely different living conditions to the original river habitat.

•Reservoir impoundment submerges a certain amount of land with consequences for terrestrial habitats, land use and human settlements present in this area.

•Depending on power plant design, a certain stretch of the river, between the dam and the power house water outlet, will have a reduced amount of water discharge, or none at all.

The magnitude and importance of these general impacts can be very different depending on the specific site conditions of the project. The environmental impacts identified and mitigation measures proposed for Ralco are described below.

Downstream river regime

Dam and reservoir operation will influence river hydrology in two ways, namely (i) changes in seasonal flow, somewhat lowering wet season (winter) discharge and increasing dry season (summer) discharge through the seasonal storage capacity of the reservoir, and (ii) changes in daily regime by turbine operation in case of peak production. However, in the specific situation of the project, this is not a major concern.

The Biobío below the dam site flows in a rather narrow, steep, gorge-like valley without any settlements or agricultural land in direct contact with the river. Furthermore, the Pangue reservoir tailwater reaches to just a few kilometres below the power house water discharge. Operation of the two power stations has to be co-ordinated in order to prevent adverse effects on other water users further downstream.

Water quality

Presently, water quality in the river is good, as the catchment is rather thinly populated and as there are no important industrial activities which could affect water quality. This situation changes quite dramatically further downstream – runoff from agricultural land, sewage from large settlements and from industries are discharged into the river, turning the Biobío in its lower reaches into quite a heavily polluted river. Reservoir impoundment will have effects on water quality mainly through formation of a rather deep lake and through the submersion of 34.7km2 of forest land.

Flooded biomass will decompose in the water, a process which consumes large quantities of oxygen. Model calculations have shown that reservoir impoundment without any measures would result in oxygen depletion and lead to anoxic conditions in the deeper zones of the reservoir. This in turn would have impacts on the potential of the reservoir as a habitat for fish, and would also influence downstream water quality.

To minimise this effect, a pre-impoundment clearing will be carried out to reduce the amount of biomass in the future reservoir. This measure also allows the timber in the reservoir area to be used — a valuable resource which otherwise would be lost. After a few years, water quality in the reservoir will have reached a stable state. As nutrient content in the inflowing water, as well as pollutant input will continue to be low, the reservoir will be an oligotrophic lake (poor in nutrients and plant life but rich in oxygen).

Reduced river flow

Without any measures, the river bed will be dry during part of the year. In order to preserve this stretch of the river as a habitat for fish and other aquatic species, a minimum residual flow has been determined which will be approximately 27m3/s. Some water will have to be released from the dam in order to guarantee this minimum flow year-round.


The natural vegetation in the reservoir area and its surroundings is evergreen broadleaved forest, composed predom-inantly of different Nothofagus species. Large areas of this forest type still exist in the project area, and approximately 1800ha of such forest will be lost due to reservoir impoundment. As a mitigation of this impact, the surface of lost forest will have to be reforested in another area and Endesa will establish a forest reserve. The Araucaria forests (Araucaria araucana), for which this area is famous and which play an important role in the culture and diet of the local indigenous population, only grow in much higher elevations (above 900m asl) and are not affected by the project.

Terrestrial and aquatic fauna

Due to its geographical isolation, the Chilean fauna and flora is quite rich in endemic species. However, as the reservoir area is quite small, the habitat type that will be submerged exists in large quantities outside the reservoir area and, as no unique habitat types are affected, the impact of the project on terrestrial fauna will be marginal. Pre-impoundment clearing will help prevent animals from drowning during filling of the reservoir. No endangered or rare animals are affected by the project.

As in the terrestrial fauna, Chilean aquatic fauna includes many endemic species. In the project area there is one endangered endemic fish species (Diplomystes nahuelbutaensis). It has come under considerable pressure mainly through the introduction of exotic, northern hemisphere salmonid species (trouts and salmons), which not only compete for food with the indigenous species, but also prey heavily on them. Although these local species do not migrate over longer distances, dams and reservoirs nevertheless have an impact on them as they prevent movement, reduce the available living space and isolate populations from each other, thus restricting gene flow.

As a mitigation measure, a monitoring and artificial breeding programme has started for this species; it will provide valuable scientific information on its biology, and will allow the maintenance of the population. The reservoir will be oligotrophic, nevertheless it has some potential for fish production and fishing. Most river fish species normally do not find suitable living conditions in lakes or reservoirs, but there are species which will develop well in the reservoir.


The upper Biobío in the project area flows in a narrow valley through beautiful scenery with forested mountains topped by snow-covered volcanoes. It is a typical mountain ‘white water’ river. The dam and reservoir will be clearly visible in this landscape, and the aspect of the water course will change fundamentally. No mitigation is possible for this impact except for the careful rehabilitation of all surfaces used temporarily during construction.

Social impacts and resettlement The main concern in relation with the project is its impact on the local human population. The wider project area is inhabited by the Pehuenche, a group of the Mapuche indians of Chile. Approximately 400 of them will have to be resettled due to the project, as they will lose their houses or land through reservoir impoundment.

For this reason, an essential part of the EIA consisted of a detailed study of the local socio-economic situation, including cultural aspects of the life of the affected people. In a further stage, a resettlement action plan has been prepared, including a detailed household survey and an extensive participatory process for the choice of resettlement options. The main aspects of the resettlement process are that:

•In accordance with the preferences of the affected population, two resettlement sites have been chosen, one downstream of the project site, the other one upstream of the site, providing a better perspective for maintaining the traditional lifestyle. Families to be resettled were given the choice of these two options. It turned out that most of the affected persons from the lower of the two affected villages chose the downstream option, while most of the inhabitants of the upper village preferred the upstream solution. Indeed, the economic situation of the affected persons will improve considerably, mainly in terms of availability of land, infra-structure and agricultural capabilities.

•The form of settlement has been chosen in accordance with preferences of the affected people and will be as individual houses surrounded by their land.

•A house has been designed in co-operation with the people to be resettled, which respects their traditional lifestyle, but also improves their living conditions.

•An organisation has been formed which will supervise activities related to resettlement and project implementation.

•A 10-year assistance and training programme for the affected population has been formulated.

•The resettlement areas include sufficient communal land for fuel wood production, summer pasture for livestock, and also Araucaria forests for collecting the seeds of these trees, which traditionally form an important part of the locals’ diet, and which also have a commercial potential.

Ongoing work

Environmental and socio-economic aspects will continue to be important throughout the construction phase of the project and beyond. Some of the main points are:

•Implementation of the resettlement plan.

•Environmental supervision of construction activities in order to ensure compliance of the contractors with the conditions stipulated in contracts and tender documents.

•The ecological station which was founded in relation with the construction of Pangue will also assume responsibilities for Ralco, mainly in rehabilitation of temporarily used areas and water quality monitoring.

•Monitoring of all environmental mitigation measures, including environmental auditing, in order to provide the competent authorities with the information required for controlling implementation of measures.

The total cost of environmental measures in the context of the hydro power project will amount to US$46M, and US$20M is destined for the resettlement programme. Total direct investment costs for the project will be US$486M.