A unit of the World Bank and a Nicaraguan brewer have agreed to develop the 25-MW El Salto YY hydroelectric project in northeastern Nicaragua.
The International Finance Corp. (IFC) and Compania Cervecera de Nicaragua S.A. announced the agreement August 20, saying it is the first project in Latin America to be funded by IFC InfraVentures, which helps develop infrastructure in poor countries.
IFC InfraVentures is to cover up to 20 percent of development costs and will work with Compania Cervecera to develop the project.
ï¿½Working with IFC will enable us to provide better, more reliable power at a lower cost, helping increase the country’s competitiveness and reduce dependence on imported fossil fuels,ï¿½ Compania Cervecera General Manager Jaime Rosales Pasquier said.
The new hydro plant will be Nicaragua’s first in more than 30 years to be financed entirely by the private sector.
ï¿½As the first IFC InfraVentures investment in the region, El Salto hydro underscores our commitment to promoting renewable energy as a viable alternative for improving access to power in developing countries,ï¿½ IFC Infrastructure Director Bernard Sheahan said.
IFC Latin America Director Atul Mehta said IFC intends to scale up its involvement in Nicaragua’s power sector where government policies support private participation.
In 2007, Energy regulator Instituto Nicaraguense de Energia approved provisional licenses for five hydro projects in a portfolio managed by national utility Comision Nacional de Energia. (HNN 1/25/07) The provisional licenses, which authorize companies to carry out project studies, included the project then called Salto Y-Y.