Ecuador will promote reforms to accelerate a fair energy transition that promotes public and private investment in the sector, with the support of a $500 million loan approved by the Inter-American Development Bank (IDB).

The program will support policies to decarbonize the energy sector and promote non-conventional renewable energy sources, alternative ways to generate power, and energy efficiency, as well as demand management measures, regional integration, and electric mobility. 

It will also advance the energy transition plan for the Galapagos Islands, universal access to electricity, and steps to reduce gender and disability gaps in the electricity sector.

The program is expected to result in an expanded share of renewable energy in the country, new charging stations for electric vehicles, and electricity for more homes in rural and marginalized urban areas.

The people of Ecuador will benefit from electricity services that can meet growing demand, as well as a sustainable, fair, inclusive and clean transition that reduces greenhouse gas emissions. The program will benefit 80,358 households that will gain access to electricity, 25,645 of which are located in rural and marginalized urban areas. 

The operation will also boost private-sector activity in renewable energy generation, distributed generation, electric mobility, and new alternative energy sources, creating job opportunities and economic activity. Women and people with disabilities will also benefit from new job opportunities at companies in the sector and from access to training on technical subjects, violence prevention, and community outreach.

The $500 million loan approved by the IDB consists of $450 million from the IDB and $50 million from Korea's Infrastructure Development Co-financing Facility. The $450 million IDB segment has a 19-year repayment term with a 7-year grace period and an interest rate based on the Secured Overnight Financing Rate. The $50 million segment from the Korea Infrastructure Development Co-financing Facility has a 15-year repayment term with a 3-year grace period and an annual interest rate of 2.5%.