$500m Central America RE boost

The European Investment Bank (EIB) has lined up $230m in funding for renewables across Central America, joining the Central American Bank for Economic Integration in a new programme to help decarbonise the region’s power sector.

All told, the programme will enable some $500m of investment into wind, PV, hydropower and geothermal projects, as well as energy-efficiency schemes, in six countries – Honduras, Nicaragua, El Salvador, Guatemala, Costa Rica and Panama.

Despite the immense promise held by renewables in Central America, the region’s wind and solar markets remain at a nascent stage. Nicaragua, a regional leader in relative terms, saw a 44MW Globeleq-backed wind project commissioned this spring.

In a landmark decision last month, the EIB announced it will implement new lending criteria that will effectively screen out all new coal and lignite plants, and skew heavily towards renewables.

The Luxembourg-based EIB – the world’s largest public bank – regularly lends more than €10bn ($13.4bn) a year to the energy sector, the vast majority of it within Europe.

However, the EIB does occasionally lend money outside of Europe, including to the renewables sector, and it may play a growing role in Europe’s international climate and energy policy.

In 2011 the EIB and the Central American Bank for Economic Integration formed a scheme to jointly support hydropower in Costa Rica.