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Projects

Summary of proposed guarantee

Summaries of proposed guarantees are provided prior to Board consideration and before final contract signing, and they are therefore subject to change. Project briefs are disclosed after Board consideration and contract signing and reflect the terms of the project at the time of contract signature. Environmental and Social Review Summaries are provided for projects assigned an Environmental Assessment Category of A or B.

 

Project name
Eolo Wind Farm
Project ID
10994
Fiscal year
2013
Status
Active
Guarantee holder
Globeleq Mesoamérica Energy (Wind) Limited
Investor country
Bermuda
Host country
Nicaragua
Environmental category
B
Sector
Power
Date SPG disclosed
June 22, 2012
Project Board date
July 26, 2012
Gross exposure
 $25.2 million
Project type
Non-SIP
Strategic priority area
Complex Project
IDA

This summary covers a shareholder loan and equity investment by Globeleq Mesoamérica Energy (Wind) Limited of Bermuda in Eolo Wind Farm in Nicaragua. The investor has applied for MIGA guarantees up to $25.2 million for a period of up to 20 years against the risks of transfer restriction, expropriation, and war and civil disturbance.

The Eolo project involves the construction of a 44 megawatt wind farm in Rivas Province on the shores of Lake Nicaragua. Eolo consists of twenty-two Gamesa G90 2 megawatt wind turbine generators, as well as the facilities and equipment required to connect the generators to a high voltage substation. It is estimated that Eolo will be able to generate approximately 169.6 gigawatt hours of electricity per year, without requiring any fossil fuel supply. The wind farm is expected to start operations by December 2012 and the electricity will be purchased by local distribution companies Distribuidora de Electricidad del Norte, S.A. (Disnorte) and Distribuidora de Electricidad del Sur, S.A. (Dissur).

Environmental Categorization

The project is a category B under MIGA’s Policy on Social and Environmental Sustainability. Click here to view the Environmental and Social Review Summary.

Development Impact

Nicaragua’s electrification rate is among the lowest in Central America. Additionally, reliance on thermal (oil-fired) generating plants has made the long-term marginal costs the highest in the region. This project aims to provide additional generation capacity that is not only renewable and clean, but also helps reduce the average marginal cost of generation, resulting in an overall reduced cost of electricity to users.

MIGA’s participation in the project is aligned with the agency’s commitment to support investment into countries eligible for concessional lending from the International Development Association and investment in infrastructure.

 
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