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Chilli Dam Fortis Case Analysis

3578 words - 15 pages

Fortis Inc., a company with interests in various North American electric utilities, is proposing to build the Chalillo dam on the Macal River in Belize, Central America. The dam would contribute to the economic development of the country by meeting the increasing demand from industry and consumers for electricity. The company believes that the dam is the most feasible, reliable, and cheap supply of electricity. Environmental non-governmental organizations (ENGOs) oppose the project because of the destruction of wild animal and plant life and the adverse downstream impact, and allege that there are more viable and cost-effective sources. Through a strategic analysis of the ...view middle of the document...

Common means of attacking Fortis Inc. were legal action, web publications, political lobbying, and celebrity spokespersons.
The project had been assessed twice for its feasibility and impacts. The first assessment, conducted by the Natural History Museum found that it would be too environmentally destructive to continue with the project. On the other hand, the project was assessed by the Belizean government’s National Environmental Appraisal Committee and found that the economic benefits that would be a result of the project far outweighed the environmental effects. The committee also felt that there were ways of mitigating the environmental effects and reducing them to a minimum.
While the project was approved by the Belizean government and its committee, the issue remained that Fortis Inc. would have to learn to deal with the negative publicity if it chose to proceed with the project, even if the effects were, in actuality, brought to a minimum.

Essentially, there are three options for Fortis to choose. The first option is to give up building the Chalillo dam on the Macal River. It is the best way to protect aquatic and terrestrial wildlife. The location of the dam contains rare and discrete floral flood habitat, which relied on the flow of oxygenated water and seasonal flooding. The Chalillo dam project would have negative impacts on biologically rich land and many animals inhabiting the area. As a result, stopping to build the Chalillo dam is the best option to avoid the effect on wildlife. By choosing this alternative, Fortis will reduce the amount of negativity that many ENGOs and other organizations are currently showing them. They could retain their good reputation if they decide to not build the Chalillo dam. On the contrary, there are some disadvantages for stopping the project. First, Belize will not solve their electric storage issue, which means that Belize still need to import electrical energy from Mexico. Fortis would also lose out on the massive economic boom it could bring to Belize and all the potential profit. There could potentially be other projects that would bring equal value to the company so Fortis needs to exercise their options.
Secondly, Fortis would select an alternative site for damming; for example, build the dam at tributaries. The dam at tributaries could potentially supply the same volume of water. It will have less detriment to the environment; nevertheless, building such dam requires technical, economic and environmental surveys, which will incur more funding and possible damage to the environment.
The third alternative is for the company to continue to build the dam and take mitigate measures to alleviate the impact of construction and operation on the environment. There are several advantages for building dam. After the Chalillo project is complete, Belize would have a more reliable and secure supply of electricity. Due to Mexican system experiencing difficulties to supply a stable...

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