IFC is supporting the construction of the 38.5MW La Vegona project with senior and subordinated loans totaling $30M. IFC has also mobilized $68M for the project, including a $23M parallel loan from OeEB, Austria’s development bank.
The project is IFC’s first renewable energy investment in Honduras. Beginning in mid-2013, the hydropower plant is expected to produce about 181GWh a year, and will power thousands of households in the country. La Vegona will also help to improve the competitiveness and sustainability of Honduran exporters by supplying lower-cost energy from a clean source. During the construction phase, the project is expected to employ about 500 local workers.
“La Vegona represents an important milestone for the development of renewable energy in Honduras,” said Adolfo Larach, President of COHERSA. “The project will make a significant contribution to help reduce Honduras’ dependence on imported oil, by providing a reliable source of low cost, clean energy.”
More than 60% of Honduras’ power is generated from fossil fuels, which are expensive and pollute the environment. To help address this challenge, IFC is working to support the government of Honduras’ strategy to develop its domestic renewable energy resources, including hydropower.
“Promoting renewable-energy projects is at the core of IFC’s climate change strategy in Latin America and the Caribbean,” said Bernie Sheahan, IFC’s Director for Infrastructure in Africa and Latin America and the Caribbean. “La Vegona will have a positive impact on the environment by offsetting carbon emissions of fossil-fuel power projects, while providing long-term renewable energy at affordable prices to Honduras.”
