The Inter-American Investment Corporation (IIC) has signed a US$78 million financing package with Hidronormandia S.A. to support the construction and operation of a run-of-the-river hydropower plant and transmission line in Ecuador.
The plant, located on the Upano River in the city of Macas, will help diversify Ecuador’s energy matrix by adding 49.6 MW of renewable energy capacity and generating 349.9 GW/h of clean energy every year. It will reduce dependency on fossil fuels and imports from neighboring countries, while displacing approximately 126,781 tons of carbon dioxide equivalent emissions per year.
In addition to long-term financing, the IIC also provided technical assistance funds to conduct environmental studies, including an environmental flow management plan—the first of its kind in Ecuador.
The financing for the US$111.4 million project includes a US$44 million IIC Loan, comprised of an A-loan of US$10 million and a B-loan of US$34 million from Cordiant, Oikocredit, Triodos Groenfonds N.V and Corporacion Interamericana para el Financiamiento de Infraestructura S.A. (CIFI). The package also includes co-loans from FMO and the Canadian Climate Fund for the Private Sector in the Americas for US$24 million and US$10 million, respectively. The loans offer a tenor of up to 11 years.
Hidronormandia is a privately owned Ecuadorian company created to design, build and operate the above hydropower project. Hidronormandia will contribute to the development of adjacent communities through direct employment generation during its construction period, creating more than 200 jobs and 45 employment opportunities during its operation phase. Hidronormandia S.A. will also share a portion of its earnings with affected communities and employees in compliance with ecuadorian regulations. Its main shareholders are Ecuaenergia S.A. (59.99%) and NormanTrust Group S.A. (40%).