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San Ignacio, Belize: By noon on most weekend days, Macal River choked with hundreds, even thousands bathers, waders, swimmers seeking respite sweltering streets jungle town high interior Belize. Children play shallows, teenagers swim back forth across gentle current, their parents grandparents cool themselves, conversing with friends neighbors.

The Macal has always been central life here, providing drinking water, food, primary means commerce – initially to transport goods, now main attraction nature-loving tourists on which local economy depends. But today river is also center roiling, four-year battle over construction new dam one Central America's last undisturbed forests.

Environmentalists local residents say dam will harm surrounding environment. Canadian company building says will have minimal ecological impact making country more self-sufficient. project highlights dilemma faced many poor nations, especially those whose economies rely primarily on ecotourism: how bring economic development maintaining reason travelers – their tourist dollars – go there.

Twenty-five miles upstream here, Fortis Inc. building $30 million Chalillo dam, project proponents say will bring cheaper, cleaner power country struggling keep up with growing electricity demand. While large dams have fallen out favor US elsewhere, Central America – region with many rivers little fossil fuel – embracing them. Dozens dams are proposed under construction region, uplands Panama Costa Rica Usumacinta River valley on Mexico-Guatemala border, where proposed series dams threaten inundate major Mayan ruins.

"This bad project way around," says Gráinne Ryder, policy director Toronto's Probe International, watchdog group opposed Chalillo dam. "Fortis may make quick prof out it, but Belizeans will left with real costs generations."

Not so, says Fortis. "It opinion Chalillo project and hydroelectric production most cost-efficient environmentally responsible energy supply option Belize," counters spokeswoman Donna Hynes, noting Belizean electricity demand has been growing 8 10 percent year. "Belize already experiences brownouts their supplies [imported] Mexico."

Belize, former British colony 256,000 people, one the premier destinations nature tourism Western Hemisphere. Each year, 180,000 travelers vis country explore its coral reefs Mayan temples, hike canoe through backcountry wilderness. Their spending accounts about fifth Belize's $1.3 billion economy directly employs quarter its workforce.

Residents San Ignacio surrounding Cayo district say most people here are against dam, T-shirts banners bearing such slogans "The Macal ours" are hot items. San Ignacio town council opposes project, vice mayor testified against during an unsuccessful attempt block construction.

"As soon you talk about holding back 160 million cubic yards of water forested area you can sure there's going be putrification [in reservoir] mercury levels will go up and water quality will go down," says Mick Fleming, co-owner Chaa Creek Lodge, an upscale ecotourism resort employs 100 people15 miles downriver dam. He other residents say that water quality declined after construction smaller Mollejon dam decade ago, facility now owned by Fortis.

The river, Mr. Fleming argues, worth more Belize its wild state then electricity Chalillo will deliver, position several environmental groups have taken well. Belize Zoo others oppose project, part because will flood only known breeding area Belize endangered scarlet macaw. area is also home jaguars, spider monkeys, number uninvestigated Mayan sites.

But those involved Chalillo say project getting bad rap. "There energy-development project you can undertake that will not have environmental impacts," says Dawn Sampson Belize Electricity Ltd., Fortis subsidiary has monopoly on power distribution Belize. "The challenge ensure benefits outweigh negative impacts."

Fortis says dam would boost annual domestic production by about 25 percent, will help control floods, reduce greenhouse-gas emissions, and, greatly increase efficiency an existing dam downstream storing water use during valley's frequent dry spells.

The area where dam sits near an active fault still experiences tremors. But, says Fortis's chief engineer John Evans, "This structure designed with same criteria if were being built southern California."

Critics say other solutions meet peak power demand – generators driven wind, natural gas, stalk refuse sugar industry – have never been adequately explored.

The root problem, says Ms. Ryder, lack transparency the decision build Chalillo. "If had been an open competitive bidding process, would have given government consumers the chance weigh costs benefits each option," she says. "Instead you had dam-building company come forward and say were other options except build dam."

Probe International other groups are trying get investors to boycott Fortis, but barring shareholder revolt, project looks likely completed end 2005.

Patrick McCully, dam expert International Rivers Network, hopes other countries region will weigh options before rushing ahead with foreign-sponsored dams. "Not every hydro project is wrong, but lot unnecessary poorly performing projects get built because lack transparency," he says.