IDB Approves $500m Line for Costa Rica Power

The IDB has approved a $500m conditional credit line to support the 2008-2014 investment program of Costa Rica’s state-owned utility, ICE. Loans granted from the line will be for 25 years, with a 5-year grace period and a variable interest rate. Local counterpart funds for these investments will total $120m, says the IDB. The resources will finance preliminary studies for new hydroelectric and geothermal generation projects, modernization of equipment at the Rio Macho hydroelectric plant and a program to dredge and restore the reservoirs of six hydroelectric plants to increase productivity and extend the life. Electricity demand is forecast to grow at about 5.4% a year and Costa Rica will apparently have to double its power generation capacity every 15 years. The IDB says that in next eight years alone, ICE will have to invest some $4bn in generation, transmission and distribution.