Companhia Estadual de Geração e Transmissão de Energia Elétrica (CEEE-GT) in Brazil’s Rio Grande do Sul state will get a $88.7 million loan from the Inter-American Development Bank (IDB) to expand, rehabilitate, and modernize its electricity generation and transmission capacity in order to meet growing demand for power and improve service reliability.
The IDB loan is sovereign guaranteed and it will help finance the company’s Pro-Energia program, contributing to ensure the construction of the electricity infrastructure necessary to meet the projected increase in demand, which includes the 2014 Soccer World Cup.
The IDB loan will contribute to finance:
- The expansion of the Ijuizinho II small hydroelectric plant, whose output capacity is expected to increase to 15 MW from 1 MW.
- The rehabilitation and modernization of the Itaúba and Passo Real hydroelectric plants to improve operational efficiency and reduce maintenance costs.
- The expansion and upgrading of the company’s transmission network to improve the load and voltage levels.
The project is expected to create 1,500 to 1,600 direct jobs during construction and the expansion of Ijuizinho II is expected to avoid the emission of about 15,000 tons of carbon dioxide equivalent annually.
The IDB loan is for a 25 years, with a four-year grace period and an interest rate based on LIBOR. The IDB financing will be complemented by a $59.1 million a loan from the French Development Agency (AFD) to CCCE-GT. The total project cost is $147.8 million.