Program seeks to strengthen Ecuador’s National Electricity Distribution System while providing better quality and more reliable electricity services to residential customers

The Inter-American Development Bank (IDB) announced approval of a $80 million loan to Ecuador to finance the strengthening of Ecuador’s National Electricity Distribution System (SND), in order to support a change in the country’s energy matrix and to improve the delivery of quality electricity service to residential customers.

The specific objectives of this loan program are to help strengthen Ecuador’s medium-voltage and low-voltage electrical infrastructure; to contribute to modernization and efficiency in the management of demand in the SND; and to improve the reliability levels of electricity service. The IDB will work closely with Ecuador’s Ministry of Electricity and Renewable Energy (MEER) to implement this program.

This program’s primary component will finance works in SND, to address Ecuador’s projected electricity demand, with the strengthening of sub-transmission lines and the power distribution network.

The program’s second component will finance infrastructure to improve the efficiency and reliability of the SND relying upon best global practices and standards among national-level electricity providers.

The program’s third component will finance various activities related to the strengthening strategy for Ecuador’s Electricity Distribution Enterprises (EDE), including the purchase of measuring instruments for programming and testing of training-related equipment, and training for automatic and remote activation of the SND from new management centers.

This project is equally aligned with the global objectives of the Sustainable Energy for All (SE4All) Initiative, which is being coordinated globally by the United Nations, in coordination with the IDB for Latin America and the Caribbean. Within the SE4ALL Initiative, the IDB has committed to doubling the rate of improvement of energy efficiency programs by 2030.

The $80 million IDB loan is for a 25-year term, with a 48-month disbursement period and an interest rate based on LIBOR. The loan includes $30 million from the China Co-financing Fund for Latin America and the Caribbean. An additional local counterpart contribution for the project totals $10.6 million.