IDB (The Inter-American Development Bank) has granted the approval of a $250 million loan for Costa Rica’s electricity sector. The money will be used to meet the projected 5.1% yearly increase in electricity demands and to raise standards of living. The plan proposes to add 1,714 MW of installed energy capacity over twelve years (2012 to 2024).

77% of the current capacity is created by renewable sources. As for the proposed increase, 98% will be renewable energy.

The Reventazon Hydroelectric Project (PHR), which Costa Rica’s Institute of Electricity (ICE) began in 2009, will receive a $98 million cash injection from the IDB financing. The 130 meter high damn will produce 305 MW as well as have a mini plant that produces 13.5 MW. Total annual capacity is projected at 1,407 GWh, of which 98% is renewable. PHR is scheduled to go online in 2016.

The remaining $152 million of IDB financing will be utilized to strengthen ICE’s general infrastructure. The program will work to improve quality and security assurance and reliability. Rural area distribution will be upgraded. The improvements will be made by strengthening the current distribution network, increasing efficiency and advancing the rural supply with 500 photovoltaic instillations for more isolated communities.

After a $41.7 million dollar local contribution, the total project rings in at $291.7 million. The Inter-American Bank loan has a financing term of 25 years with a grace period of 5 years and a LIBER based interest rate.

Soource: Power Engineering