A US$88.7 million loan from the Inter-American Development Bank (IDB) to Brazilian utility Companhia Esadual de Geracao e Transmissao de Energia Eletrica (CEEE) will allow for a number of hydropower projects in Rio Grande do Sul state.
The sovereign guaranteed IDB loan will help finance CEEE’s Pro-Energia program, which includes the expansion, rehabilitation and modernization of its generating and transmitting assets to improve service reliability.
The loan will also help the country meets its projected increase in demand, which includes an expected spike when Brazil hosts the Soccer World Cup in 2014.
Hydroelectric projects specifically mentioned in an IDB release include:
- Expansion of the 1-MW Ijuizinho 2 hydropower plant, which is to see capacity increased to 15 MW; and
- Rehabilitation and modernization of the Itauba and Passo Real hydroelectric plants.
IDB says the work will create up to 1,600 jobs during construction, and the Ijuizinho 2 expansion is expected to reduce the equivalent of 15,000 tons of carbon dioxide annually.
The IDB loan is for 25 years, with a four-year grace period and an interest rate based on LIBOR. IDB’s financing will be complemented by a $59.1 million loan from the French Development Agency. In all, the projects are expected to cost $147.8 million.