World Bank unit to fund Sri Lanka renewables including hydro

A unit of the World Bank is providing a US$15 million risk-sharing facility and project structuring expertise to help evaluate and finance renewable energy projects in Sri Lanka including small hydropower.

International Finance Corp. (IFC) said it will supply the risk-sharing facility to Commercial Bank of Ceylon to help the bank evaluate and finance renewables projects to provide environmental and economic benefits. IFC said the program is intended to help the private sector mitigate climate change effects while continuing to meet significant infrastructure gaps in South Asia.

“The initiative will support the Sri Lankan government’s mission to increase private participation in wind, hydro, and biomass projects,” IFC South Asia Director Paolo Martelli said. “With most of the country’s power generation reliant on fossil fuels, this project will help the country diversify its energy infrastructure.”

IFC said it would share its financing, project-structuring capability, and benchmark data for renewable energy technologies with Sri Lanka. It said it would help enhance Commercial Bank’s ability to appraise projects using those technologies.

An advisory component funded by the governments of Ireland and Japan and the World Bank’s Global Environment Facility is to help Commercial Bank build capacity and skills to implement the program.

In April, the Asian Development Bank approved US$160 million in loans to Sri Lanka to improve electricity services, including support for renewable energy that is to add 200 MW of small hydropower to the national grid. (HydroWorld 4/15/09)

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