MICI-BID-CH-2017-0115 - The Board of Executive Directors considers and supports the research report submitted by MICI.

On May 28, 2020, MICI submitted to the Board of Executive Directors the Compliance Review Report for the Alto Maipo Hydroelectric Power Project in Chile (complaint MICI-BID-CH-2017-0115), which has reviewed the Bank's compliance with the operational policies on Environment and Safeguards Compliance (OP-703) and on Gender Equality in Development (OP-761). The Board of Executive Directors endorsed the 7 recommendations made by MICI and instructed Management to submit, within a maximum period of 30 days, an Action Plan to address them. This Plan must be prepared in consultation with the MICI and contain an implementation schedule. MICI will monitor the implementation of this Action Plan.

The investigation carried out by MICI focused on five specific topics derived from the construction, operation and maintenance of the Project, a pass-through hydroelectric project that involves the construction of 68 km of tunneling under the Andean mountain range in the Maipo River drawer: (1) potential noncompliance with Operational Policies OP-704, OP-710, and OP-708; (2) potential impacts on the sedimentology regime in the Maipo River; and (3) potential impacts on third-party water use rights. The investigation focused on five specific issues: (1) alteration of water flow in the targeted rivers, particularly with regard to the area’s recreational and economic activities (kayaking and rafting); (2) decline in the area’s economic activities, particularly tourism and leisure; (3) high worker migration, with an emphasis on gender-differentiated impacts; (4) effects on residents of the community of El Alfalfal; and (5) adequate consultation processes and lack of information disclosure on project impacts and management measures.

The Report concludes that the Bank has breached certain requirements of the Operational Policies OP-703 (Directives B.5, B.6 and B.7) and OP-761 regarding, among other aspects:

  • Identification of impacts to the tourist and recreational uses of the rivers intervened by reducing flows and determination of mitigation measures in consultation with those affected;
  • evaluation of impacts on communities due to a significant increase in the number of workers in the area, including evaluation of differentiated impacts on women and girls;
  • specific impacts to economic activities and way of life of the community during the construction of the project, in particular to the activities of the “arrieros” and impacts from vehicle traffic in the area during construction;
  • evaluation of impacts and adaptation of mitigation measures with respect to the community of El Alfalfal, by noise generation, air pollution and social division in the community;
  • MICI also found certain breaches regarding the Bank's supervision of environmental and social aspects of the Project. According to the Report’s findings, MICI included 7 recommendations for consideration by the Executive Board.

MICI has conducted this investigation in close collaboration with CAO, the compliance mechanism of the World Bank Group's International Finance Corporation, which co-financed the Project until May 2018, as the CAO received a similar complaint. Collaboration has enabled mechanisms to access more experts, as well as coordinate their research actions under a more efficient scheme.

For more information on this complaint, please refer to the Public Registry.