At a Glance: Multilaterals step up Nicaragua energy game

Multlaterials have and will continue to play an important role in advancing Nicaragua's public policies, in particular those that focus on energy.

Lawmakers recently approved two IDB power sector loans, one for US$86.5mn to finance a sustainable electrification and renewable energy program, and another for US$65mn to help guarantee financial and operational sustainability.

Legislators also authorized financing from the OPEC Fund for International Development for over US$10.5mn for rural electrification.

In its just-released 2018-22 country strategy, the Central American Bank for Economic Integration (Cabei) said it could finance government initiatives such as the promotion of renewable energies, energy efficiency and savings, interconnections with regional grid Siepac and rural electrification, among others.

"Nicaraguan authorities propose to continue further efforts to ensure national coverage and efficiency. For that, they will continue expanding infrastructure and incorporating technological improvements and research, along with greater interaction with regional interconnection entities, bodies. On the other hand, it is expected that diversification of the energy matrix will continue toward renewable sources, expansion of generation capacity and connectivity of residents in unprotected zones to the national system, as well as the strengthening of operational efficiency and national savings will continue," according to the lender's strategy.

Cabei approved five power sector financing operations in 2013-17 for Nicaragua that totaled US$479mn and included hydroelectric projects El Barro and La Sirena, as well as a sustainability program.

In another development, Nicaragua's Banco de la Producción (Banpro) has requested support from the Inter-American Investment Corporation (IIC).

Banpo is looking to secure US$21.8mn in financing for its Financiamiento Verde lending instrument, which targets corporate clients, SMEs and small-scale agricultural producers that seek to implement renewable energies and energy efficiency measures.

IIC's board is scheduled to review the financing request next month.

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For a look at early stage power sector projects in Nicaragua, go to the BNamericas Project Profiles Database which includes:

Pictured: Larreynaga hydroelectric dam (CREDIT: Enel)