Volume 45 Number 178,
July-September 2014
Wind Energy in the Isthmus of Tehuantepec:
Development, Actors and Social Opposition
Sergio Juárez-Hernández and Gabriel León *
Date received: November 19, 2013. Date accepted: April 4, 2014
Abstract

There has been notable development of wind energy on the global level, and it already accounts for an important share of global electrical capacity in terms of renewable sources. The global wind energy industry is now turning its attention to developing countries with suitable locations to set up wind energy facilities. In Mexico, the southern region of the Isthmus of Tehuantepec has the greatest wind energy potential and is where the majority of wind energy projects are taking place. This work examines the development of wind energy in this region and the main actors involved and analyzes various aspects ranging from the right to information to the environmental implications of these practices, aiming to understand the growing social opposition to projects in this zone. The prevailing wind energy exploitation model in the Isthmus of Tehuantepec favors developers, limiting the benefits received by local communities and increasing social backlash against the projects.

Keywords: Mexico, Oaxaca, Isthmus of Tehuantepec, wind energy, renewable energy
INTRODUCTION

The growing share of renewable energy sources (RES) in power systems is attributable to a variety of reasons, including energy diversification and security, combatting climate change, creating jobs, improving access to energy and driving rural development (REN21, 2012: 15). Wind energy stands out for its notable progress in recent years. Between 2006 and 2011, global electrical wind power capacity grew at an average annual rate of 26%, reaching 238 GW by the end of the time period, or 61% of the world's RES generation capacity (REN21, 2012: 17, 22).1 As the principal markets become saturated, the global wind industry is turning its attention towards emerging and developing countries with significant wind power potential. By 2030, these nations will likely be home to half of the installed wind capacity worldwide (GWEC, 2012: 7). Mexico is among this group of countries with a suitable location to exploit wind power on a large scale. Early studies on the national level to evaluate the quality and distribution of wind in Mexico were first conducted in 1980. Since then, the region that has most stood out is the Isthmus of Tehuantepec, in the state of Oaxaca, where average annual wind speed exceeds 10 m/s. On average, wind speed of 6.5 m/s is used around the world to generate power (Borja, 2010: 45; Magar and del Río, 2011: 42). The winds of the Isthmus of Tehuantepec are relatively stable, with a high percentage of hours per year, for which the area's wind power potential is considered to be excellent. The topographic features of the Isthmus of Tehuantepec are equally favorable for installing wind power sites. All of these aspects make the isthmus one of the most attractive places around the world to commercially exploit wind power. The United States National Renewable Energy Laboratory (NREL) estimates over 44,000 MW of wind power potential in Oaxaca in an area over 8,800 km22 (Elliot et al., 2004: 48). The national wind potential is estimated at 71 GW (Sener, 2012a: 79).2

Wind power generation is still a nascent industry in Mexico. Of the 61,570 MW of capacity of the National Power System (SEN) as of 2011, wind energy only accounted for 0.9% (554 MW), contributing 0.5% (1.46 TWH) of the 292 TWH generated nationally that same year (Sener, 2012b: 64-72, 89-94). However, various wind projects began operations in 2012, exceeding 1,000 MW installed by the end of the year with 97% of wind power capacity operating on the Isthmus of Tehuantepec (CRE, 2012a). Because national energy policy favors private investment in the power sector, especially in the electricity industry, the country has conceded exploitation of renewable energy sources, especially wind power, to the private sector (Vargas, 2010: 134-136). By October 2010, the Energy Regulating Commission (CRE) had already granted 141 permits to install 4,605 MW of RES-based electricity, 3,410 MW of which came from wind projects, and 1,128 MW were already operating (CRE, 2012b: 15). The main methods to exploit this wind resource are self-supply3 and independent power production (IPP).4 Of the 38 permits granted by the CRE by the end of 2012 for wind power projects, which added up to 3,662 MW of authorized capacity, 30 were operating under the self-supply system (2,970 MW) and five were IPP (511 MW) (CRE, 2012a). In general, the power produced by a self-supply permit holder is provided to a group of industrial or commercial consumers or other services located all around the country. For IPP projects, the power is sold entirely to the Federal Electricity Commission (CFE).

The effort to build wind farms on the Isthmus of Tehuantepec has been spearheaded by private, mainly foreign, enterprises, whose interests frequently clash with those of the local communities in which they seek to set up their projects. This has been reflected in growing social unrest in response to the mass deployment of wind turbines, especially after realizing that wind development has not benefited local populations as was expected. This work aims to analyze how wind power exploitation has developed on the Isthmus of Tehuantepec, identifying the main actors involved and studying the most relevant features of this process to elucidate the causes behind the growing social opposition to wind projects in this region.

EXPLOITING WIND RESOURCES ON THE ISTHMUS OF TEHUANTEPEC

Of the 3,662 MW of wind power authorized by the CRE as of December 2010, over 2,414 MW were for projects in Oaxaca (CRE, 2012a). Of these, around 1,269 MW were already functioning, representing 97% of the country’s operational wind capacity. With the exception of 90 MW for public agencies, the rest of the wind power installed on the Isthmus of Tehuantepec belongs to private enterprises, some national, but to a greater extent, foreign. The mass arrival of wind power projects is a relatively recent development. Below, this article will address the background of this phenomenon.

The Beginning

The first wind farm on the Isthmus of Tehuantepec, and also in Mexico, was built in Ejido La Venta, in the municipality of Juchitán de Zaragoza, Oaxaca, in 1994. Known as La Venta I, the center was equipped with seven 225-kw wind turbines manufactured by the Danish company Vestas. The project was commissioned by the CFE as a Financed Public Work (FPW). It was conceived of as the pilot wind farm to collect information on how wind turbines really performed in the specific conditions of the Isthmus of Tehuantepec. Since its launch, La Venta I has produced exceptional operational results. However, following its successful implementation, no further concrete proposals were immediately made to install new wind farms. Although several companies sketched out ideas, their plans ran into multiple obstacles that undermined the profitability of the projects.

The Wind Corridor on the Isthmus of Tehuantepec

In 2000, the government of Oaxaca organized an international summit, sponsored by the Institute for Electricity Research (IIE), to promote wind power investment opportunities in the state, especially targeted towards foreign investors. The meeting, known as the International Colloquium on Wind Power Development Opportunities in La Ventosa, Oaxaca, invited the most important wind companies from around the globe. Later, in 2001, 2002 and 2004, under the name International Colloquium on Wind Power Development Opportunities in the Wind Corridor of the Isthmus of Tehuantepec, the summit addressed how to identify and eliminate obstacles to launching projects, paving the way for large wind corporations. It is useful to note that the idea to develop the wind corridor on the Isthmus of Tehuantepec emerged during an ambitious project to convert the isthmus into a commercial and interoceanic communication route to rival the Panama Canal. It was not until 2006, though, that construction began on La Venta II, an 83.3-MW capacity wind farm in Ejido La Venta. The project was handled by the CFE, which awarded it to the Spanish companies Iberdrola and Gamesa in a tender, with an investment cost of 112.5 million USD. This opened the door to more multinational companies, which currently dominate wind power exploitation on the Isthmus of Tehuantepec. With construction of various projects looming, it was time to reinforce and expand the infrastructure to transmit and transform electrical power in the zone to guarantee connection to the power transmission grid. A proposal was made for a plan that came to be known as the Open Season (Temporada Abierta, TA), which emerged from the international meetings described earlier.5 This plan would be fundamental to ensure that private wind power projects could flourish on the Isthmus of Tehuantepec.

First Open Season

The first Open Season proceeding in Oaxaca began in February 2006 and ended in December of the same year. Twelve self-supply projects were registered with nearly 2,000 MW of authorized capacity and estimated annual generation above 7,500 GWh (see Table 1). In addition, five IPP projects were included, outlined in the CFE wind program (La Venta III and Oaxaca I-IV) with total capacity of 507 MW. The CFE defined the features for transmission infrastructure required and in 2007, commissioned the relevant works, which would later be insufficient to handle the power generated by the permit holders. Based on the reserved capacities, private enterprises underwrote 80% of the total cost of the works, while the CFE covered the other 20%. The first of the three stages of works for the first Open Season concluded in 2009, connecting the SEN to the Eurus and Parques Ecológicos de México projects. The second stage incorporated four other projects, and the third, which involved a new 145-km transmission line operating since mid-2010, linked with all other private projects and CFE efforts.

The Advent of Private Wind Power Projects

Alongside the works carried out for the first open season, construction began on wind power projects. Between 2008 and 2012, seven private self-supply wind farms were built, with total installed capacity of 668 MW to generate 2,628 GWh annually (see Table 2). In this same time period, five IPP stations were built, as well as some small production of the IIE, together adding 516 MW of installed capacity and 1,699 GWh/year of power generation. To date, 1,269 MW of wind power have been installed on the Isthmus of Tehuantepec, for annual power generation estimated at 4,660 GWh, assuming an average plant factor of 42%, compared to a global average of 26%. Note that the installed capacity barely accounts for 3.8% of total possible installation capacity in the region (33,200 MW). Moreover, most of the installed wind turbines produce energy for self-supply companies that consist of major industrial and commercial consumers, as well as services (see Table 2). More than 90% of the capacity belongs to private companies, of which two, Acciona Energía and Iberdrola, account for nearly 65%.

Pending Projects

Many projects planned for the first Open Season to begin operations before 2013 experienced setbacks, thanks to the 2009 financial crisis and opposition from local affected communities. To date, seven self-supply wind power projects are waiting to be built or are under construction on the Isthmus of Tehuantepec, which will add 1,161 MW of capacity and 4,425 GWh/year of authorized power generation (see Table 4), with a total investment of over 2.3 billion dollars (CRE, 2012a). They are expected to launch commercial operations between 2013 and 2014.

At the beginning of 2012, the CFE announced a tender for 600 MW of wind power in various IPP contracts (Sureste I and II projects). An expected 1,208 MW of additional capacity will be constructed between 2014 and 2026 in Oaxaca (Sureste III and IV), also for public service (Sener, 2012b: 126). For now, at the end of 2011, the CRE opened a second Open Season in Oaxaca. As of May 31, 2012, 1,130 MW of capacity had been reserved for seven private projects and 800 MW for the CFE, for a total of 1,930 MW of transmission that will begin to operate at the end of 2015 (CRE, 2012b: 22; Sener, 2012a: 110).

These projects have been planned by private companies and the CFE to exploit wind energy on the Isthmus of Tehuantepec; whether are not they are made concrete will depend on an adequate legal and regulatory framework and the availability of financing, both for the projects and to strengthen transmission capacity in the region. The backing of local communities will be equally as crucial. The problem is, as the number of wind power projects on the Isthmus of Tehuantepec grows, so too does the social opposition. To clarify this situation, some of the specifics of Oaxacan wind power development and the principal actors involved are described below.

MAJOR ACTORS IN DEVELOPING WIND POWER ON THE ISTHMUS OF TEHUANTEPEC

Developer Companies

From the beginning, it was considered essential that private capital help develop the wind potential of the Isthmus of Tehuantepec, given Mexico’s insufficient economic capacity and technology. From the aforementioned, it also emerges that private enterprises, especially Spanish multinationals, are the main protagonists in exploiting wind power in this region. These and other corporations, united in the Mexican Wind Power Association (AMDEE), have started to push for adequate legal and regulatory measures to ensure their projects will be profitable. Also, they have indirectly impacted the agendas of the Oaxacan state and municipal governments, lobbying for attracting foreign investment to install wind power plants as a priority. Both local governments and wind power companies have spun wind power projects as the ideal opportunity to increase the standard of living for communities in Oaxaca, thanks to the multimillion dollar investments that go along with the industry. This has generated big expectations among the populations on the isthmus as to how the projects will improve their living conditions. Even so, as will be shown later on, the magnitude of these improvements has been far from what affected communities expected.

Although wind power companies frequently describe their projects in terms of the number of households to which they provide energy, the above analysis makes it perfectly clear that most of the wind energy produced on the Isthmus of Tehuantepec benefits a set of companies associated with the permit holders operating the plants. Although the partners consuming this power tend to stay on the margins of the social issues brought on by these projects, one of the critiques made by opposition groups is that the power produced does not benefit affected locations where the percentage of households without electrical power is above the national average.6

Financing Institutes

The main sources of financing for wind energy projects include commercial banks and development banks. The latter contributed significantly less following the 2008 financial crisis, opening the way for national, regional and development banks to step in (GWEC, 2012: 5). By 2012, the World Bank (WB) and Inter-American Development Bank (IDB) had together mobilized financial resources to install over 300 MW of wind power in Mexico (GWEC, 2012: 7). Similarly, the WB made a 20 million USD donation to incentivize rates for the La Venta III plant in its first five years of operation.

One positive aspect of development banks being involved is that they tend to approve credit based on compliance with provisions related to environmental and social issues. For example, the IDB, which has partially financed projects such as Eurus and La Mata-La Ventosa in Mexico, includes safeguards and guidelines in environmental and social areas. However, the information that companies report to banks may be very different from reality, as was the case for the mega-wind power project that the multinational consortium Mareña Renovables plans to build on community-owned land in San Dionisio del Mar, Oaxaca, with financial support from the IDB and other institutions.7

The Environmental and Social Management Report for the project ascertains that the consortium consulted with indigenous groups in compliance with Mexican laws and the principles of the bank, that there was no opposition to the project from these groups and that agreements were approved regarding use and enjoyment of the land with respect to land ownership and rights (IDB, 2011: 30). However, the indigenous communities of San Dionisio del Mar reported that the consortium had not consulted with them, nor were there agreements to use the 1,643 ha of communal land for up to 30 years of the project. The co-proprietors of the community launched a campaign to stop the project from being constructed, which led to the social unrest that escalated in early 2012, paralyzing works to prepare for the project set to begin operations before the end of 2013.

Governmental Actors

Institutions from all three levels of government have taken part in promoting and developing the Isthmus of Tehuantepec wind corridor. In the early stages, the state government of Oaxaca played an active role in organizing the referenced international meetings and other activities to attract multinational wind power companies (Borja et al., 2005: 61-64). Municipal authorities have generally assumed a more marginal role in the arrival, installation and operation of projects (Nahmad, 2011: 106), but are more involved in key issues such as granting permits. On the federal level, the CFE and the CRE are the major agencies involved. The way in which wind power exploitation in Oaxaca has developed demonstrates how the CFE stepped aside to open the door to private developers after implementing the first plants (La Venta I and II). The state enterprise still maintains a relevant role in planning and managing transmission infrastructure in the region, although it commissions the specific works to private groups (CRE, 2012b).

Similarly, the CFE has stood in the way of new plans, such as community wind power projects that would allow landowners, local residents and other social agents to be shareholders in the projects, thereby accessing a greater portion of the profits and benefits. At the end of 2009, co-proprietors of the Ciudad Ixtepec municipality began to work on a proposal for a community wind power project. The 102-MW capacity project would be part of the recent CFE growth program. The co-proprietors, advised by a British company (Grupo Yansa), made a formal proposal to the state enterprise, hoping it would receive preferential treatment. However, not only did the CFE disregard the proposal, soon after, it also announced that it would release a tender for the Sureste I Phase I and Phase II plants, under conditions highly unfavorable to the community members’ proposal. In light of the subsequent criticism of political and social actors, in March 2013, the CFE announced it was canceling the tender for Sureste I Phase I, which would include the community proposal. The role of the CFE in using wind power on the Isthmus of Tehuantepec can largely be explained by current politics governing the energy sector, where the ultimate objective is to broaden the influence of private capital (Vargas, 2010).

In keeping with these policies, the CRE, as a regulatory body, has played an important role in devising a new regulatory framework pursuant to the requirements of developers and expediting power generation permits for them. The regulations focus on aspects such as connection to the SEN, recognition of capacity, rules for dispatch, procedures to exchange energy and the compensation system, as well as models for contracts and carrying charges (Sener, 2012b: 57-61). These instruments, which are highly technical and economic, are meant to ensure that wind power projects are profitable.

As such, the social and environmental implications of wind power projects have not been properly addressed. Although the adverse effects of wind power are less severe than other energy technologies (EC, 2003: 12-13), they still must be acknowledged and there must be specific measures to control them. The absence of targeted socio-environmental standards for wind power projects leads to uncertainty as to the nature and magnitude of the medium and long-term consequences (Castillo, 2011: 11), causing a lack of trust among directly affected populations.8 The Environmental Impact Statements (EIS) that companies must provide to the Ministry of the Environment and Natural Resources (Semarnat) are essentially a mechanical series of generalized laws and standards for environmental conservation and protection, where compliance, once project construction and operation has begun, is doubtful (CDPIM, 2013: 24).

An equally pressing issue is the lack of public political drive to comprehensively develop the wind power sector in the country, which would include, among other items, creating its own wind power technology, as other countries have done, including Spain, Germany and Denmark (Borja et al., 2005: 17-31). Although wind power development on the Isthmus of Tehuantepec is still nascent, it has the potential to act as a catalyst for setting up a national wind energy industry to broaden and deepen the benefits of wind power exploitation in Mexico.

Local Communities

The way in which the aforementioned actors have behaved has molded how communities on the isthmus have perceived and reacted to the massive deployment of wind turbines in their territory. Below, this article goes into detail describing the most controversial events to help understand the roots of social opposition to wind power projects.

The Right to Prior, Free and Informed Consultation

The right to prior consultation and information for communities, especially indigenous groups, whose living environment and conditions are affected by any type of project, is recognized in international provisions and national legislation.9 Commercial-scale wind power projects cannot go around this community right, even when they are considered completely compatible with sustainable development. In Oaxaca, wind power companies limit the information available on their projects, especially in technical terms, focusing on payments for use and enjoyment of land, while dismissing or avoiding talk of potential adverse effects (Nahmad, 2011: 108-109). Information is often only disclosed to those within the direct project area, while the rest of the residents, even those from the same community, receive nothing (Nahmad, 2011: 105-108). Moreover, companies do not reveal key data, such as the price at which the electricity will be sold and the terms of distribution, thereby limiting the chance for landowners to negotiate a more equitable share of earnings (Borja et al., 2005: 160). On top of that, there is no government agency involved in disseminating this information to the population (Nahmad, 2011: 106-107). By contrast, wind power companies receive detailed technical and economic studies for decision-making. This asymmetry of information is one of the reasons why relations between residents and companies have deteriorated.

It is also useful to note that standards regarding the right to consultation are rather imprecise, which is one reason why they are often not fulfilled (Cruz, 2008: 9-10). Because the scope, methodology, procedures and obligations of the State are not specified, currently, the right to consultation for local communities is often nothing but a sham. Proof of this can be found in disputes between wind power companies and the local population, such as the San Dionisio del Mar project.

Land Lease Agreements

While in developed countries, social opposition to wind power projects focuses on negative consequences for the landscape (Rogers et al., 2008: 4219), on the Isthmus of Tehuantepec, it has emerged with regards to land access. The cash compensation offered by companies pays to reserve, sell or lease land where the wind turbines will be installed, and is the most significant contribution made by projects to local communities. Frequently, companies opt to lease the land, setting compensation by the number of wind turbines installed, hectares of land occupied or royalties on a percentage of gross income for the sale of electricity. Lease contracts have a term of 20 to 30 years with option to extend for a similar time period. Currently, the 14 wind power plants operating in Oaxaca encompass a land surface of 9,770-13,198 ha,10 although the physically occupied surface is only about 2-4% of that.

One of the distinctive features of wind power exploitation on the Isthmus of Tehuantepec is the fact that the original owners have repeatedly questioned the land lease agreements, alleging misconduct during negotiations. The principal complaint is that companies failed to provide complete and truthful information on expected economic returns on projects that would have allowed them to negotiate a fairer share of the dividends.

Another factor to consider is the prevailing ownership regime in this area of Oaxaca. Much of the land is socially owned, in the form of ejidos, or common land, or agricultural communities, pursuant to the Agricultural Law. Although companies recognize that this form of ownership provides certain advantages, such as being able to access relatively large swaths of land rather quickly, it can also be inconvenient, as they must negotiate with entire communities or large groups of co-proprietors (Borja et al., 2005: 154; Nahmad, 2011: 81-84). Some of the strategies used to deal with this difficulty include going to the president of the ejido commission or shared land group, to try to convince residents, taking advantage of the strong influence these leaders have in their communities (Nahmad, 2011: 107-108). Collaboration between these local authorities and companies can be so close that the loyalty of the leaders to the community interests they represent has come under question (CDPIM, 2013: 20). The same has been said of municipal and state officials responsible for, among other tasks, authorizing and granting permits to build the power plants (Rojas, 2012). Similarly, companies sometimes set up their own community assemblies to speed up the definition and signing of land lease agreements (CDPIM, 2013: 18). Even land legalization programs, such as the Program for the Certification of Ejido Land Rights and the Titling of Urban House Plots (Procede), which grant individual ownership certificates, are seen more as a strategy to break up agricultural nuclei, dissolve ejido assemblies and facilitate company access to lands (Peréz, 2013).

Notwithstanding the above, the compensation paid by companies is generally lower than in other countries. On the Isthmus of Tehuantepec, land reservation payments are between $150-200 ha/year. For leasing, prices range between $1,500-12,000 ha/year and for land with roads and wind turbines, between $7,500-36,000 ha/year. Royalties go from 0.025 to 1.53% of gross income (Nahmad, 2011; 81-84; CDPIM, 2013: 16).11 By comparison, in the United States, annual payments (in dollars) for land reservation are between $2-10 per acre,12 $4,000-8,000 per MW installed and royalties are 3-6%. In Spain, concretely, in Galicia, payment for land lease can run as high as €3,500 ha/year and royalties average 3.5%, while in Holland and Denmark, royalties are between 4-10% (Regueiro, 2011: 57-67). Companies argue that the discrepancy is due to the fact that Mexico does not have comparable RES incentives.

The total levelized cost of the wind power generated on the Isthmus of Tehuantepec has been estimated at 4.5 US¢/kWh, which, together with a preferential carrier charge lower than 2.0 US¢/kWh, assumes a global cost of 6.5 US¢/kWh (0.85 $/kWh) (Apodaca, 2012). Companies sell the electricity to their consuming partners at a cost of between 5-10% lower than the CFE rate, depending on their activities, location and voltage. For industrial consumers, electricity has an average cost of 1.46 $/kWh,13 such that a sale price 10% lower than that rate would guarantee the wind power companies a differential greater than 50%. However, because these copious earnings are not reflected in the compensation paid to owners of land affected by the projects, they are retained by the wind power companies almost in their entirety.

Sources of Employment and Local Development

Wind power developers like to highlight how their projects have contributed to creating jobs and acquiring goods and services to the benefit of the local population and enterprises. The construction stage is the most labor-intensive and it is at this stage that the local population is generally most involved. It has been calculated that the construction of wind farms on the Isthmus of Tehuantepec has generated a total of 4,700 direct jobs and 4,900 indirect (AEE, 2013). Although these jobs do mean additional sources of economic income for affected communities, their benefits are temporary, because plant construction barely lasts a year and a half. Moreover, the civil works related to the project only represent about 1-6% of total investment, whereas the wind turbines account for 74-82% of this amount (EWEA, 2004: 98). This means that the majority of the 2.616 billion USD invested in the 1,269 MW of wind power operating on the Isthmus of Tehuantepec were allocated to purchasing the 914 wind turbines from companies like the Danish Vestas (58), the United States firm Clipper (59) and the Spanish corporations Acciona (371) and Gamesa (426). Although some components are produced in Mexico, most are manufactured abroad, and as such, their national content is low.14 The operation and maintenance stages are less labor-intensive, reducing the number of permanent jobs created. The 14 wind power plants operating in Oaxaca employ around 300 people (AEE, 2013), which means that each wind turbine installed creates, on average, three jobs. For the local population, there are few jobs during these stages, and they are generally not very well paid (Nahmad, 2011: 106). Similarly, the social infrastructure works that these companies are legally required to undertake in communities affected by the wind energy projects only represent a miniscule percentage of the total investment, and do not make a big impact on the communities overall (Nahmad, 2011: 109). It has also been reported that the infrastructure and operation of these wind power plants have disrupted agriculture and livestock in the region, the major economic activities sustaining the communities on the isthmus, as a result of building access roads and platforms, and flooding brought on by leveling land, not to mention the noise of the wind turbines, which affects livestock (CDPIM, 2013: 20-21). The construction and operations involved in the wind energy project in San Dionisio del Mar may have caused irreversible damage to the local ecosystem, affecting the major activities, such as fishing, that sustain the indigenous people located around the area.

The mass arrival of wind power projects to the southeast of Oaxaca has not improved the living conditions of local communities as they expected, judging by a few indicators. In municipalities such as Juchitán de Zaragoza, Asunción Ixtaltepec and Santo Domingo Ingenio, where wind power development has been concentrated, from 2000 to 2010, with projects already operating or under construction, the degree of marginality of these municipalities remained intermediate (De la Vega et al., 2011: 211-212, 231). Although some towns, like La Venta and La Mata, maintained intermediate marginalization, in others, such as La Ventosa and Santo Domingo Ingenio, the degree of marginalization rose from intermediate to high. It is notable that 5.1% of the population in Oaxaca was living in a household lacking electrical power in 2010, then the highest percentage in the country and far above the national average of 1.9% (Coneval, 2011).

In fact, one of the negative social consequences of these wind power projects is that they have aggravated socioeconomic asymmetries that emerge among those receiving payments for leasing their land and those that do not own any land (Nahmad, 2011: 106). This situation has generated tension and division within communities, causing the local population to reject wind power projects even more strongly.

Environmental Implications

The magnitude of environmental consequences is largely dependent on where the job sites are located. Until now, wind power projects on the Isthmus of Tehuantepec have predominantly been installed on agricultural and livestock lands, which, in principle, minimizes the repercussions on local ecosystems, although, as already indicated, produces negative effects for the soil and therefore impacts agricultural activities. There is also an issue with birds and bats dying after colliding with the wind turbines, because the Isthmus of Tehuantepec is one of the principal bird migration routes in the world. With the number of wind turbines installed, the risk of collision is high. A study conducted in 2007-2008 in La Venta II found a migratory bird mortality rate of 20 birds or more per installed MW per year, a figure far above the standards of wind power plants (Ledec et al., 2011: 17). Resident bird and bat populations run a greater risk because they act as a population sink,15 which could affect other species as the number of wind turbines grows.

It would be possible to limit these negative consequences if there were only one wind power plant, but this situation involves the simultaneous installation and operation of thousands of units in the same region. In this way, given the projected growth of wind power capacity, by 2026, Oaxaca could have between 3,000 and 4,000 wind turbines in operation.16

Regarding carbon emissions, by the end of 2012, there were 19 wind power projects on the Isthmus of Tehuantepec registered in the MDL to obtain Emission Reduction Certificates (ERC) (CDM, 2013). Total reductions exceeded 5.6 million t-CO2eq/year, and just over half was related to operating plants. Earnings on the sale of ERCs complement income from the sale of electricity for wind power companies, making these projects even more profitable.

To summarize, Table 5 explains the major sources of conflict identified in this study that encourage social opposition to wind power developments on the Isthmus of Tehuantepec.

In terms of land leasing, it would be useful to establish a methodology to determine how much compensation should be paid, at the very least to meet international standards. This task could be left to the CRE in coordination with state governments. A more effective measure to increase social acceptance and contribute to community development would be to move towards a community wind power project regime. The greater social involvement intrinsic to this type of plan has been crucial to notable wind power development in Holland, Germany and Denark (Toke, 2005: 305-306), and would be a suitable way to mitigate social unrest towards wind power projects on the Isthmus of Tehuantepec. Aiming to reduce uncertainties regarding the environmental consequences of wind energy projects, it would also be useful for the Semarnat to generate and apply specific standards to identify, control and alleviate potentially adverse effects.

CONCLUSIONS

Wind power exploitation has grown significantly in recent years. A good portion of this growth is taking place in developing countries with extraordinary wind power potential, like the Isthmus of Tehuantepec in Oaxaca, Mexico. Although the CFE pioneered the installation of wind power plants in this region, multinational companies now dominate commercial wind energy exploitation on the Isthmus of Tehuantepec, under the IPP and, to a greater extent, self-supply regime, to provide power to a group of large companies or industries. The specific nature of wind power development in Oaxaca has affected the benefits that communities on the isthmus have received, which have not been of the magnitude expected. This has further aggravated inequalities and divisions within communities, generating conflicts that threaten social stability in the region. Modifying these circumstances will require broader and more effective participation of affected populations in wind power exploitation to ensure more equitable distribution of earnings and change the perception of these projects. With this in mind, the community project plan, which has proved successful in countries with more wind power experience, is worthy of consideration. It is time to rethink how the actors involved in developing wind energy on the Isthmus of Tehuantepec relate to each other to better take advantage of the region’s energy potential and benefit local communities and the country as a whole.

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* Faculty of Engineering-UNAM, Mexico. xerxio.jh@gmail.com and tesgleon@aol.com, respectively

1 Not including large hydroelectric companies.

2 The technically feasible potential maximum has been estimated at 430 GW (Magar and del Río, 2011: 42). It falls to 71 GW (Sener, 2012a: 79) after accounting for orographic, environmental and social factors and economic feasibility.

3 Private companies can acquire, install and operate power generation units to meet their own requirements or those of third parties, either legal or natural, which act as partners with the right to use the power.

4 Private companies design, build and operate power generation plants whose production is sold exclusively to the CFE.

5 In the Open Season plan, private developers report their electrical transmission and transformation requirements and the CFE prepares an infrastructure design and determines the overall cost, which is then prorated among all stakeholders.

6 In 2010, in La Venta, La Ventosa and La Mata, the percentage of households without electrical power was, respectively, 1.89, 1.96 and 3.31% (De la Vega et al., 2012), while the national percentage was 1.9% (Coneval, 2011).

7 The megaproject, which includes another site in Santa María del Mar, aims to install a total of 132 wind turbines, at 3 MW each.

8 An example of this is the lack of systematic and reliable ex post monitoring of effects on bird life, as regulatory bodies tend not to require this, or when they do, the results are not made public (Ledec et al., 2011: 18-19).

9 On the international level, Agreement 169 of the International Labor Organization on Indigenous and Tribal Peoples in Independent Countries and the Universal Declaration on the Rights of Indigenous Peoples from the UN. On the national level, Articles 2 and 26 of the Constitution and mentions in some state laws.

10 Considering an occupation factor of 7.7-10.4 ha/MW.

11 In an atypical case, the CDPIM (2013: 17) reported that the wind farm La Mata-La Ventosa was paying royalties equivalent to 3.38% of gross income, a value close to international standards.

12 2.47 acres = 1 ha.

13 Equivalent to the value reported in Key World Energy Statistics 2012, from the IEA.

14 The percentage of national integration in La Venta II was barely 17%.

15 A situation in which mortality exceeds reproduction.

16 Considering 2-MW wind turbines for future projects.

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PROBLEMAS DEL DESARROLLO. REVISTA LATINOAMERICANA DE ECONOMÍA, Volume 49, Number 194 July-September 2018 is a quarterly publication by the Universidad Nacional Autónoma de México, Ciudad Universitaria, Coyoacán, CP 04510, México, D.F. by Instituto de Investigaciones Económicas, Circuito Mario de la Cueva, Ciudad Universitaria, Coyoacán,
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