The Central American Bank for Economic Integration (CABEI), the United Nations Development Program, and the World Bank’s Global Environment Facility (GEF) have agreed to finance a program to advance renewable energy development, including hydropower, in Central America.
The agencies formed the Accelerating Renewable Energy in Central America (ARECA) program to stimulate financial organizations of the region to finance sustainable energy projects such as small hydropower, wind energy, and cogeneration with biomass fuel.
CABEI President Harry Brautigam said his agency always has been involved in renewable energy generation, with a portfolio of financed projects of US$514 million. He said the bank plans to approach financial intermediaries with the project developers to accelerate investments to increase short-term power supply.
CABEI is to be the executing agency for ARECA, granting financing through financial intermediaries and with support of guarantee funds. CABEI is providing US$25 million, while GEF allots US$6.92 million.
The region, which currently has 6,200 MW of capacity, has a potential to generate 36,000 MW of hydropower, geothermal, and wind energy, CABEI said.