In recent years, hydropower plants have proliferated in Chile, generating increasing conflict while creating winners and losers. Relevant stakeholders – including government and the business sector - argue that it is vital to develop the country’s hydropower resources to meet growing energy demand and support the country’s continued growth. At the same time, the negative environmental and social impacts of hydropower are increasingly clear. Much of the country’s hydropower potential is concentrated in the south, often in areas with unique natural beauty and high ecological and tourism value. A substantial portion of these resources are located in lands that traditionally belong to the Mapuche, Chile’s largest indigenous people. The Mapuche and many others in Chile are demanding more careful consideration of the tradeoffs involved in hydropower as well as a more substantial voice in decisions about where and how to build these projects. Existing legal and regulatory frameworks do not ensure adequate opportunities to address the tradeoffs effectively. As a result, hydro projects have become the focus of intense public protests and legal disputes. Some projects are delayed or halted. Others are approved through decision-making processes that are seen as illegitimate, sometimes with disastrous results for communities and ecosystems. The status quo is not working. Addressing Chile’s hydropower “problem” will require at least three things:

First, the governance frameworks for the electricity and water sectors (among others), as well as the processes for taking decisions at the national, regional and local levels, must be structured in a way that is more coherent and inclusive.

Second, resource management needs to be made more comprehensive, so that a broader range of costs and benefits to different actors and sectors are considered before or during consideration of specific hydropower projects – not after.

Third, the rights of indigenous peoples need be more fully addressed when hydropower projects are likely to affect them. These include the right to participate in relevant decisions, including in many cases by providing or withholding free, prior and informed consent; to share in project benefits; and to receive compensation for negative effects.