Dealing with conflict 

LATIN AMERICA: Mexico has more than 1GW of wind capacity online, practically all of it in the northern state of Oaxaca, home too of Latin America’s biggest online wind project, the 306MW Oaxaca II, III and IV wind farms developed by Spain’s Acciona. Yet, elsewhere in Oaxaca, building of at least 600MW of capacity has been held up for months by local protests.

In January, an indigenous Huave Indian community took over their town hall, complaining that they had not been properly consulted on the prospective 396MW Marenas wind project. To date they remain in control, having ousted the mayor and forced him to renounce the project’s permit, signed in 2004 with Spanish developer Preneal. Installation of the 3MW Vestas turbines is now several months overdue.

Japan’s Mitsubishi, which recently bought the majority stake from Preneal, claims Marenas complies with all the regulations and that most citizens support this project from a point of view of local economic growth. The company maintains that the project will still be built on schedule by summer 2013.

The protesters, however, insist that the project does not comply with the federal San Andres ruling that industrial use of indigenous common land in Oaxaca must receive approval from the indigenous groups known as commune assemblies. They will not budge until contracts are renegotiated, and a neighbouring group say that they will take up arms if the project goes ahead as planned. These disputes follow a series of protests late last year against the 225MW Piedra Larga project further north in Oaxaca, where a man was shot dead. All sides involved agree the death was accidental, the result of a warning shot fired to disperse protesters.

History repeats

“Although events may seem extreme, things should be kept in context,” believes Ramon Fiestas, president of the Global Wind Energy Council’s Latin American committee. “As in the early days of Spain’s wind development, the industry was welcomed for bringing jobs, tax income and general wealth to poor communities in remote windy areas,” he says. “But some get land-lease contracts and jobs, others don’t.” The ensuing jealousies exacerbate historical rivalries among communities already living on the edge of the rule of law, according to Fernando Tejeda, president of the Latin American Wind Energy Association.

Early developers in Oaxaca, most of them Spanish, already paid relatively high prices for land-lease agreements but were compensated by rich winds in the area, says Fiestas. Later developments saw communities hold out for even bigger deals, leaving land holders of the earlier agreements feeling hard done by.

Spanish utility Iberdrola says indigenous groups backpedalling on agreements delayed its 102MW La Venta III by over a year. This is despite the company paying almost double for land leases in Oaxaca what it is paying on average globally, claims a company spokesman. Fiestas believes that negotiations over time will help to standardise agreements and points to a similar situation in Spain, now an orderly and mature market.

In the mid-1990s, developers arrived in Spain with wind measurements and viability plans, requesting permits to build wind farms. The regional governments gave priority to such plans and even took a capital stake in them, not without a certain amount of local outcry. Concessions were initially granted without competitive processes. After that kick start, however, development was regulated by competitive requests for tenders.

Now, such a shift is under way in Mexico, says Fiestas. Since 2006, federal regulation requires the state grid operator to call for bids for grid connection agreements and 20-year power purchase agreements linked to utility-scale wind development. Even so, the grid operator recently reported that of the 1.9GW lined up with grid agreement, mining company Penoles’s 30MW project is the only Mexican-owned one.