Next Year: CFE Will Award New Power Dam Contract

(Acapulco, JG 22 October) The controversial hydroelectric dam to be built near Acapulco, called “La Parota,” appears to be on the road to reality after years of disputes with local inhabitants in the area that will be flooded. The Federal Electricity Commission (CFE) announced that it will open bids on the construction project in 2011. The facility will have a 700 megawatt capacity and cost in the neighborhood of $900 million US dollars, to be spent over 5 years.

CFE Director Alfredo Elías Ayub told the newspaper Milenio that this is a priority project for CFE, and has been included in the state-owned public utility’s budget for next year. “Congress has already approved the project,” he said. “Now all we have to do is settle with the property owners, so they can see the many benefits this project will bring to all.” In the first Ibero-American Private-Public Meeting for the Development of Mexico, the CFE director pointed out that the village of Cacahuátepec had made a deal with the utility, and this was an important step in resolving all outstanding issues. Though other villages still remain to settle claims, the Cacahuátepec arrangement is a useful precedent, which justifies taking the project into the contracting stage. Under the arrangement, the contractor needs to find its own construction financing. When the dam is delivered to the utility, the latter will then seek financing for its purchase of the project in international capital markets.

The hydroelectric dam is about 40 km beyond the Diamond Zone of Acapulco. It will supply all the energy needs of the mountains and coast. In addition, it will resolve the chronic water shortages in Acapulco, according to Elías Ayub, and will stimulate additional investment that will in turn generate new jobs. Right now the focus is on working with state and local governments in resolving social questions related to the project and in aiding and supporting the communities affected.