AT A GLANCE: LatAm energy efficiency financing gains traction

Efforts to advance Latin America's energy efficiency plans received a boost in recent days, led by Brazilian development bank BNDES which announced it will provide up to 80% of financing for such projects.

For its part, IDB approved a loan to help improve energy efficiency on Colombia's San Andrés archipelago.

Furthermore, the US Trade and Development Agency awarded grants to Belize Water Services and Jamaica's National Water Commission to evaluate the implementation of such projects at the utilities' facilities.

In the latest developments, BNamericas has learned that the Inter-American Investment Corporation (IIC) - IDB's private sector lending arm - placed two energy efficiency initiatives in its pipeline for possible financing.

One request comes from Chilean company Inversiones y Asesorías en Telecomunicaciones e Informática which seeks up to US$10mn from IIC for a US$15mn project to develop and install high efficiency LED street lights.

The project will be carried out in the municipalities of Melipilla, Cartagena, Villa Alemana, San Javier and Coyhaique and involves replacing about 37,700 luminaires which will reduce power consumption by around 55% over the first 10 years, saving over 100,000MWh.

The other program in IIC's pipeline would support the implementation of energy efficiency projects developed by energy service companies (ESCOs) in Colombia.

"The project will offer a two-stage financing mechanism. First, during the Accumulation Stage, the IDB will provide a senior warehousing loan (IDB Loan) to a dedicated vehicle, the Colombia Energy Efficiency Trust ("CEET"), for the purpose of purchasing and accumulating credit rights arising from the [energy efficiency] EE Projects for its subsequent securitization. Second during the Mobilization Stage, the IIC will provide a Partial Credit Guarantee (PCG) to support the securitization of these credit rights in local or international capital markets," according to IIC information.

Last month, IDB and IIC, together with municipal authorities and business executives, launched a public lighting project in the Mexican city of Ensenada. IIC provided some US$15mn for local company Optima Energía to install 25,000 high efficiency luminaires that have a useful life of over 20 years and can reduce consumption up to 80%.

Other recent energy efficiency-related content from BNamericas includes:

EDP Brasil issues energy efficiency call

Chile launches public sector energy efficiency drive

UN: Right policies key to boosting LatAm energy efficiency

Colombia kicks off energy efficiency initiative

WB co-finances Mexico's energy efficiency drive

Also check out BNamericas' Electric Power Intelligence Series report:

Energy Efficiency in the Latin American Power Sector

"The implementation of energy efficiency activities has generally been limited in the LAC region, often being prioritized as a response to crises or deficits in energy supply," according to a study from UN initiative Sustainable Energy for All (SE4All) and the Copenhagen Centre on Energy Efficiency which serves as SE4ALL's Energy Efficiency Hub.