The world’s third-largest hydroelectricity plant is planned for the Amazon, Brazil.

Belo Monte, the world’s third-largest dam project, has been given the go-ahead on the Amazon’s Xingu river, despite protests from environmentalists and celebrities, such as Sting, that it will damage the basin and negatively affect the indigenous tribes based on the river.

The 11 gigawatt dam – made up of 500 square kilometres of flooded area, two reservoirs and a plant –would potentially provide electricity to 23 million homes.

According to organisation International Rivers, Belo Monte is one of more than 100 large dams planned for the Amazon and the indigenous people have been fighting against the project for more than 20 years.

Aviva Imhof, International Rivers Campaigns Director, said: “No one knows the true cost of Belo Monte. The project would displace tens of thousands of people, and destroy the livelihood of thousands more. Even as Brazil argues that the international community should support rainforest protection, its government insists on promoting mega-infrastructure projects in Amazonia that are socially and environmentally indefensible.”

Local tribes populate the entire Amazon and today (3 February) Survival International, an organisation for tribal people, reported a new tribe had been discovered in the south-west Amazon region. They were described as being “short, long-haired and with red-painted bodies”. The organisation was concerned for their health and welfare in case any outsiders attempted to infiltrate the group.

However, the Brazilian government has insisted that the Belo Monte project would be advantageous to the region, and that local people would barely be affected and those that were would be helped. Edison Lobao, Minister of Mines and Energy, commented: “The impacts will be much smaller than the benefits of this work, which will be essential to ensure the supply of electric energy in Brazil.”

Although no company has yet been awarded the contract, the government has placed certain conditions on the winning bidder. They have to: ensure schools and clinics are built in the region; plan the conservation of aquatic and terrestrial ecosystems; and maintain water quality and river flow levels.

Last year British rock star Sting showed his opposition to the plans when he spoke at a press conference in Brazil. He told the BBC: “This is the heart of the Amazon and what happens here affects the whole world. This was my intuition but now the science is backing that up, I mean substantial science is saying this is true. We need to save this forest. It is the biggest contribution to greenhouse gases – deforestation. Way beyond industrial pollution, way beyond the burning of fossil fuel for transport, or heating.”

It is thought that construction will begin in late 2010.