Biobio River Update: What’s going on with the Rucalhue Hydropower Plant in Chile?

Guest post by Zhao Zhong

Summary

The Rucalhue Hydropower Project in Chile, owned by a Chinese state-owned enterprise on the Biobío River, has faced persistent opposition from Indigenous communities and environmental groups since 2013 due to a lack of meaningful consultation, potential violations of a binding human rights agreement, threats to biodiversity and cultural heritage, and procedural irregularities—issues that escalated into a violent arson attack in April 2025—highlighting the need for Chinese companies and government actors to improve early engagement with local stakeholders, conduct robust environmental and social due diligence, adhere to international human rights and environmental standards, and establish transparent accountability mechanisms, particularly when host country regulations are weak.

Attack on the Rucalhue Hydropower Plant

According to AFP reports, on April 20, 2025, multiple armed individuals broke into the under-construction, Chinese-owned Rucalhue Hydropower Plant in Chile and set fire to dozens of trucks and heavy earthmoving machinery.^[1]

On April 21, China’s Ministry of Foreign Affairs issued a strong condemnation of the attack and called on the Chilean authorities to take concrete measures to protect Chinese enterprises, projects, and personnel.^[2]

On April 24, the Chinese Ambassador to Chile held a special meeting with the Chilean Minister of Public Security, demanding that the perpetrators be swiftly identified and brought to justice. The ambassador also requested armed protection for the enterprise and legal compensation for the damages incurred. ^[3]

On April 30, Chinese Ambassador Niu Qingbao stated in a media interview that the Rucalhue Hydropower Project complies with Chilean laws and regulations, aligns with the country’s national strategic interests, and supports Chile’s green energy transition. The project has created hundreds of local jobs and enjoys support from both the Chilean government and nearby communities. The operating enterprise has consistently fulfilled its corporate social responsibilities by investing significant resources in public welfare projects, including infrastructure improvements, ecological protection, and financial support for underprivileged students across 46 local communities. These efforts have been welcomed by the vast majority of residents.^[4]

Following the attack, some Chinese netizens posted on social media speculating that the U.S. government might be behind the sabotage in an attempt to limit China’s access to Chile’s strategic resources.^[5] Others claimed the Chilean government deliberately allowed protests against the project to escalate in order to appease domestic environmental groups and public sentiment.^[6]

So far, no organization has claimed responsibility for the attack. Lonco Segundo Suárez, a leader of the local opposition community to the Rucalhue dam, stated that his community advocates for peaceful protest and dialogue. He suspects that a right-wing paramilitary group may have carried out the attack to disrupt peaceful negotiations over the hydropower project.^[7]

Several communities have stated that they have opposed the project since 2013, yet no dialogue has been initiated with them by the Chinese authorities. At the end of April 2025, the Chinese Embassy in Chile canceled a scheduled meeting with representatives of the Pueblo Mapuche communities affected by the project, citing security concerns following the attack.^[8]

Is There Community Support?

Whether the Rucalhue Hydropower Project has truly garnered “support from local communities” and is “welcomed by the vast majority of residents,” as the Chinese ambassador claimed, is a matter of dispute. Various NGOs have voiced sharply different perspectives.

The Rucalhue project is owned by Rucalhue Energía SpA, a Chilean company that is a subsidiary of China International Water and Electric Corporation (CWE), which in turn is a wholly owned subsidiary of China Communications Construction Company Ltd. (CCCC). Prior to 2023, CWE was owned by China Three Gorges Corporation (CTG). Both CCCC and CTG are Chinese state-owned enterprises.

According to a public letter issued in September 2021 by the Colectivo sobre Financiamiento e Inversiones Chinas, Derechos Humanos y Ambiente (CICDHA) — a Latin American coalition of Civil Society Organizations focused on Chinese finance, investment, human rights, and the environment—the Rucalhue dam would affect the Biobío River, a major water source for 1.2 million people and a key irrigation resource for approximately 300,000 rural residents, including members of the Mapuche-Pehuenche Indigenous communities.^[9]

The CICDHA letter cited a 2004 friendly settlement agreement between the Chilean government and Mapuche-Pehuenche families in the upper Biobío region, which was approved by the Inter-American Commission on Human Rights (IACHR). The agreement included a binding provision prohibiting the construction of large infrastructure projects—especially hydropower—on Indigenous lands in that region. According to community representatives, the area planned for the Rucalhue project falls within those restricted zones. The project is seen as threatening Indigenous livelihoods and cultural heritage, with many archaeological sites of historical significance potentially affected by construction.

Furthermore, the project failed to properly consult the Mapu Domuche Newen Indigenous group, as well as other residents living between Santa Bárbara and Quilaco. On September 25, 2021, a community consultation was held in Quilaco, in which 90% of participants expressed opposition to the project.

In January 2024, UN Special Rapporteur David R. Boyd stated in a report submitted to the UN Human Rights Council that the Chilean government’s approval of the Rucalhue Hydropower Project violated the 2004 agreement with the Mapuche people, which had promised not to pursue large-scale projects—particularly hydropower—in the area.^[10]

According to Dialogo Chino reporting, the main concerns of local communities include the lack of public participation and insufficient consultation with Indigenous peoples. Some residents have attempted to stop the project by blocking access roads or occupying riverbanks to prevent logging and machinery from advancing. They accused the company of using force and failing to foster dialogue.^[11]

CICDHA also reported that the municipalities of Santa Bárbara and Quilaco, both affected by the project, had filed lawsuits to halt its construction.

According to local media and environmental organizations, opposition from local communities to the Rucalhue Hydropower Project began as early as 2013, even before the original owner, Atiaia Energía SpA, submitted the environmental impact assessment. By the time the project was acquired by Chinese investors in 2018, conflicts with the community had already been ongoing for five years. After CWE took over the project, it made multiple changes to the dam’s design, which triggered a new round of tensions with local residents. It was not until 2024 that the project finally obtained all the permits required to begin construction.

Since February 2021, protestors have occupied the site planned for the plant. In July 2021, at the request of CWE, local courts ordered Chilean police to evict the protestors.^[12]  In October that year, protestors returned to the site and were again removed by police and private security guards two months later. In December, the company filed new complaints against several young environmental activists for threats, property damage, and attempted robbery.^[13]

On April 23, 2025—three days after the attack—representatives of the affected Malla Malla community protested outside the Chinese Embassy in Chile, shouting slogans such as “Chinese, get out of Wallmapu.”^[14]

Are There Environmental Impacts?

Environmental organizations have criticized the Rucalhue Hydropower Project for threatening the hydrology and biodiversity of the Biobío and Quilme Rivers. The project may impact 29 species of endemic birds—such as the Dominican gull—and disturb the habitat of protected native trees, including Eucryphia glutinosa and Citronella mucronata. Land use across at least 100 kilometers downstream of the dam is expected to be altered, raising risks of landslides and flooding.

Environmental groups have strongly opposed the decision by Chile’s National Forest Corporation (CONAF) in October 2023 to declare the project “of national interest,” a designation that allowed CWE to legally clear native forest and cut down protected species under the pretext of hydropower development. Critics argue this approval disrupted protected species’ habitats and undermined conservation principles.

They further noted that in August 2020, CWE made major design changes to the project—altering the dam structure, the safety zone on the southern bank, and the layout of permanent access roads—without conducting a new environmental impact assessment.

The organization We Kimun filed complaints with local environmental oversight authorities and CONAF, citing environmental concerns related to the dam’s effects on river flow, local terrain, and regional biodiversity.

Official Responses from China and the Company

According to the CICDHA report, prior to the escalation of the conflict between the Rucalhue Hydropower Project and the community, the Chinese company failed to establish effective communication channels with the affected population. Amid frequent demonstrations in the first half of 2021, there was insufficient space for dialogue between both parties. In September 2021, a group of Latin American social organizations wrote a letter to China Three Gorges Corporation (CTG), China Water Resources and Hydroelectric Corporation (CWE), and the Chinese Embassy in Chile, addressing the issues of the project and the necessity of reevaluating its feasibility. Unfortunately, there was no response from the Chinese side.^[15]

In 2023, after CWE was transferred from CTG to CCCC, international environmental organizations like International Rivers wrote to CCCC, urging them to reconsider continuing the Rucalhue Hydropower Project and to thoroughly assess the project’s social and environmental impacts, as well as the risks related to ongoing legal disputes.^[16]

In February 2023, during the third periodic review of the People’s Republic of China by the UN Committee on Economic, Social, and Cultural Rights (CESCR), CICDHA and other NGOs submitted a report to CESCR, which included 26 cases of “Chinese corporate investments in Latin America and human rights,” including the Rucalhue Hydropower Project.^[17] In March of the same year, CESCR issued concluding observations that included recommendations such as “(business enterprises) being held accountable for violations of economic, social, and cultural rights, with particular attention to indigenous peoples’ and farmers’ land rights, environmental impacts, and expropriations in real estate and infrastructure projects, as well as the establishment of monitoring mechanisms to investigate and sanction harmful activities of such enterprises.”^[18]

On the same day the CESCR report was released, the Chinese government responded, stating that it would “seriously study the Committee’s concluding observations on China’s review through inter-departmental mechanisms” and that it would “continue to engage in constructive dialogue and cooperation with all parties.”^[19]

In January 2024, during the fourth Universal Periodic Review by the UN Human Rights Council, other member states analyzed China’s overseas projects and made recommendations for improvement. Some of the most prominent issues were related to environmental and social conflicts in Latin America, including weak regulation on projects such as dams, highways, mines, and bridges.^[20] China accepted 10 out of 11 recommendations, including those from Chile and Portugal urging the “development of stronger legislation to ensure people’s rights to a clean, healthy, and sustainable environment,” Peru’s recommendation to “continue developing measures to ensure that the overseas activities of Chinese companies do not harm but promote the enjoyment of human rights,” and Ecuador’s recommendation to “promote necessary measures to ensure that businesses and financial institutions operating both domestically and internationally respect human rights in all their activities.”^[21]

According to CWE’s official website, the Rucalhue Hydropower Project has emphasized environmental management and ecological restoration during its construction, while also striving to improve relationships with surrounding communities. In September 2024, the project initiated an intensive study of environmental documents to strengthen the awareness of environmental management among all participating construction units.^[22] In October 2024, the project’s conservation plan was formally approved. This plan includes ecological restoration work such as the planting of grasslands and pine trees over 14.34 hectares and the cultivation of over 50,000 local plants.^[23] In October 2024, the Rucalhue Hydropower Company donated 200 saplings of saltbush trees to the municipality of San Bárbara to support the local honey industry.^[24] In April 2025, the Rucalhue Hydropower Project donated a batch of traditional clothing and musical instruments with ethnic characteristics to the Pehuenche indigenous community in eastern San Bárbara, to support local cultural preservation.^[25]

The Chinese Embassy in Chile has also been closely monitoring communication between the Rucalhue Hydropower Project and the surrounding communities. More than a month before the attack, on February 28, 2025, Ambassador Niu Qingbao of the Chinese Embassy in Chile visited the Rucalhue Hydropower Project. He carefully reviewed the project’s approach and initiatives in external relations, community communication, and sustainable development, and highly praised the company’s proactive responsibility actions.^[26]

Recommendations

After China accepted the relevant recommendations from the United Nations Human Rights Council and CESCR, it should take significant steps towards stricter environmental assessments, including effective participation from affected communities, more comprehensive pre-consultation procedures, and accountability mechanisms. This would not only signal positive progress but also reflect a sense of responsibility in fulfilling commitments.

Taking the Rucalhue Hydropower Project as an example, by the time it was acquired by CWE in 2018, the project already had a history of at least five years of socio-environmental conflict. This case highlights the inadequate capacity of some Chinese enterprises in identifying and managing project risks, as well as a relatively high tolerance for risk that may overlook potential human rights and ecological impacts.

The approval process for the Rucalhue Hydropower Project involved multiple procedural violations and the exploitation of legal loopholes. In cases where the host country’s environmental regulations are inadequate or enforcement capacity is weak, Chinese enterprises and their financing banks should refer to the Guidelines for Green Development in Overseas Investment and Cooperation issued jointly by China’s Ministry of Ecology and Environment and Ministry of Commerce, and proactively adopt higher Chinese standards or international best practices to promote a higher level of green investment.

Chinese stakeholders should engage in more open and honest dialogues with communities, environmental organizations, and NGOs to build trust, understand the legitimate concerns behind protest actions, particularly those regarding cultural heritage and ecological preservation. It is important to avoid politicizing or conspiratorializing all protests against Chinese projects, as this could complicate originally straightforward motives and hinder the proper resolution of issues.

Chinese embassies in Latin America and other regions should serve as formal communication channels between enterprises, financial institutions, governments, and civil society. Through timely early warning systems, they can intervene more effectively to resolve issues before social and environmental conflicts escalate.

For negative impacts already caused, more comprehensive restoration and remedial measures should be established to promote inclusivity, transparency, and win-win outcomes for policies and projects.

Project Background

The Rucalhue Hydropower Project is expected to cost approximately 350 million USD and is being constructed by Rucalhue Energia Spa, a subsidiary of China Water Resources and Hydroelectric Corporation (CWE). The project is located on the Biobío River in the Biobío Region, which is in southern-central Chile, and represents the fourth level in the river’s cascade development. The dam site is approximately 10 km from the towns of Santa Barbara and Quilaco, about 50 km from Los Angeles, 210 km from the port of Talcahuano, and around 490 km from Chile’s capital, Santiago. Upstream from the dam site, about 7.5 km, is the existing Angostura Power Station, while downstream, 1 km away, is the Rucalhue village residential area. The primary purpose of the dam is power generation, and it will be a run-of-river hydroelectric station.^[27]

In June 2024, CWE and CCCC First Highway Engineering Co., Ltd. (CFHEC) signed an EPC contract. On August 20 of the same year, the project officially commenced.^[28] The total construction period for the power station is 1,217 calendar days, which is approximately 40 months, with the main construction taking 1,156 calendar days. After the transfer, both CWE and CFHEC are wholly-owned subsidiaries of CCCC.

Thanks to Maia Seeger (Sustentarse) and Kirk Barlow (International Rivers) for their contributions.

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^[1]https://info3.com/south-america/220922/text/short/gunmen-attack-chineseowned-power-plant-site-in-chile

^[2] https://www.fmprc.gov.cn/fyrbt_673021/202504/t20250421_11599248.shtml

^[3] http://cl.china-embassy.gov.cn/sgxw/202504/t20250427_11605051.htm

^[4] http://cl.china-embassy.gov.cn/sgxw/202505/t20250501_11614728.htm

^[5] https://www.sohu.com/a/888040823_121286293

^[6] https://baijiahao.baidu.com/s?id=1830362938215916148&wfr=spider&for=pc

^[7]https://www.ex-ante.cl/confidencial-lonco-que-dijo-que-todo-es-valido-contra-la-central-recalhue-reaparece-en-manifestacion-en-la-embajada-china/

^[8]https://www.laizquierdadiario.com/Embajada-China-cancela-encuentro-con-comunidades-mapuche-pewenche-en-medio-de-controversia-por

^[9]https://latsustentable.org/wp-content/uploads/2022/08/Carta-Rucalhue-chino-15-sept-2021-copia.pdf

^[10] https://digitallibrary.un.org/record/4036105/files/A_HRC_55_43_Add.1-EN.pdf

^[11] https://dialogue.earth/en/justice/citizens-and-state-at-odds-over-chiles-rucalhue-dam/

^[12]https://www.elmostrador.cl/cultura/2021/07/27/desalojan-toma-contra-la-construccion-de-la-central-hidroelectrica-rucalhue-en-el-biobio/

^[13]https://cooperaccion.org.pe/chile-envian-cartas-por-criminalizacion-de-defensores-ambientales-por-el-caso-rucalhue/

^[14]https://www.ex-ante.cl/confidencial-lonco-que-dijo-que-todo-es-valido-contra-la-central-recalhue-reaparece-en-manifestacion-en-la-embajada-china/

^[15]https://media.business-humanrights.org/media/documents/Human_rights_and_Chinese_investment_in_LA-cases-CN.pdf

^[16] https://www.internationalrivers.org/wp-content/uploads/sites/86/2025/04/rucalhue_letter_english.pdf

^[17]https://cicdha.org/new-report-examines-rights-violations-by-chinese-business-activities-in-latin-america/

^[18]https://tbinternet.ohchr.org/_layouts/15/treatybodyexternal/Download.aspx?symbolno=E%2FC.12%2FCHN%2FCO%2F3&Lang=en

^[19]https://tbinternet.ohchr.org/_layouts/15/treatybodyexternal/Download.aspx?symbolno=INT%2FCESCR%2FCOB%2FCHN%2F51887&Lang=en

^[20]https://news.mongabay.com/2024/08/china-accepts-u-n-recommendations-to-improve-environmental-conflicts-in-latin-america/

^[21] https://www.ohchr.org/en/hr-bodies/upr/cn-index

^[22] https://www.cwe.cn/xwzx/jydt/202409/t20240910_266844.html

^[23] https://www.cwe.cn/xwzx/jydt/202410/t20241020_267460.html

^[24] https://www.cwe.cn/qywh/shzr/202410/t20241029_268122.html

^[25] https://www.cwe.cn/qywh/shzr/202504/t20250417_275658.html

^[26] https://www.cwe.cn/xwzx/jydt/202503/t20250306_274050.html

^[27] https://eps.ctg.com.cn/cms/channel/1ywgg1/126911.htm

^[28] https://www.chinca.org/cica/info/24082309005811