$750 million hydropower loan

The Inter-American Development Bank (IDB) has approved a $750 million loan to Venezuela for the construction of the Tocoma hydropower project.

The hydropower plant, whose total cost is $3 billion, will have an installed capacity of 2,160MW. Its 10 generators will be placed in operation on a staggered basis between July 2012 and March 2014. The plant will be built, operated and maintained by CVG Electrificación del Caroní SA (EDELCA), a state company.

The IDB loan will finance engineering, administration, civil works, equipment, the associated transmission system and a sustainable environmental and social management plan.

When completed, the project will be the fourth hydropower plant functioning in the Lower Caroni River Valley, which provides 70% of Venezuela’s electricity supply. The IDB participated in the development of this energy system with a $500 million loan approved in 1993 to help finance the construction of the Caruachi project and a $350 million loan for an electric transmission system for the Guri hydroelectric plant.

The IDB loan is for a 20-year term, with a nine-year grace period, at a variable interest rate. The Andean Development Corporation is expected to provide parallel financing consisting of two loans amounting to $300 million each.