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IDB approves $200 million for Porce III hydroelectric power plant for Medellín, Colombia

The Inter-American Development Bank today approved a $200 million loan to Empresas Públicas de Medellín to support the construction of the Porce III hydroelectric power project and the enhancement of the company’s corporate performance and efficiency.

The hydroelectric power plant located 147 kilometers northeast of Medellín will have an installed capacity of 660 megawatts and is expected to begin operations in the second semester of 2010. The plant’s output will be connected with the national grid and will contribute to meeting Colombia’s growing electric power demand.

EPM will take environmental and social measures associated with the project to meet both IDB policy and Colombia legislation. The state company will also undertake corporate development activities that will strengthen institutional performance and efficiency.

The Porce River watershed is the site of seven other hydroelectric power projects, major contributors to Colombia’s electric power system.

The IDB has provided about $2.75 billion in financing to Colombia to support 35 projects accounting for about 30 percent of the country’s current generating capacity.

The latest project will contribute to economic growth and provision of electric power at equitable rates in an efficient and sustainable manner.

The IDB loan is for a 20-year term, with a seven-year grace period, at a variable interest rate. Local funds will finance $711 million of the project.