The Inter-American Development Bank (IDB), through the Banca Nacional de Desarrollo, has announced the approval of a loan for $9.3 million to promote private investment in the generation of renewable energy in areas of Colombia that are isolated or not interconnected.
About 60 percent of Colombia's territory is not connected to the electricity grid, and roughly 1.8 million of its people rely on limited and scattered power services. Thanks to the IDB loan, private sector companies that supply and administer public electricity services, as well as providers of renewable energy technology that have a history of experience and credit with mini-grids, will be able to expand their services.
By the end of the program in 2020, it's expected that emissions of greenhouse gases will have been reduced by 67,900 tons.
The program is one of the innovative mechanisms for public-private financing that the IDB has been promoting to increase private investment in renewable energy. The operation, which will use funds from the Climate Investment Funds, has a payout period of five years, with a 10.5-year grace period and an interest rate fixed at .75 percent. The implementing agency will be the Banco de Comercio Exterior de Colombia S.A. (Bancóldex).
About the IDB
The Inter-American Development Bank is devoted to improving lives. Established in 1959, the IDB is a leading source oflong-term financing for economic, social and institutional development in Latin America and the Caribbean.The IDB also conducts cutting-edge research and provides policy advice, technical assistance and training to public and private sector clients throughout the region.