Cuba has signed a deal with the Kuwait Fund for Arab Economic Development that will see KFAED provide US$30 million in financing for the construction of 34 small hydropower projects.
The agreement, signed this week in Havana, targets Cuba’s rural areas with the hope that improved energy supplies will decrease immigration toward cities and stimulate agricultural production.
KFAED said the 34 small hydro projects will be constructed on existing infrastructure and have a cumulative capacity of about 14.6 MW. The initiative will also include the construction of three linking substations that will transmit to Cuba’s national grid, along with about 75 km of transmission line.
The organization also said the financing will lead to the “expansion of scientific research centers and universities to enhance in general the development of the hydropower sector, as well as the institutional support and consulting services for the detailed designs, preparing tender documents and supervision of the project.”
The 21-year loan includes a grace period of seven years and is expected to cover about 40% of the project’s overall costs. The remainder will be paid for by the Government of Cuba.
KFAED did not specify when it expects the first small hydro plant to come on line, but that the initiative should be completed within seven years.
Cuba has shown an interest in developing its hydro sector in recent months, with the Caribbean island benefitting from an International Renewable Energy Agency (IRENA) collaboration with the Abu Dhabi Fund for Development (ADFD) in November. That partnership will also increase the country’s access to small hydro.