The European Investment Bank (EIB) and Paraguay’s national power company (Administración Nacional de Electricidad – ANDE) today signed an agreement on a €75 million loan for the construction of a new power transmission line.
The loan will finance the building of an approximately 360 km-long second high voltage (500 kV) transmission line from the Yacyretá hydropower plant to Villa Hayes in the greater Asunción area and the enlargement and upgrading of three substations to increase capacity and improve the reliability of the power grid.
Alongside the EIB loan, the project will receive a €10 million EU grant from the Latin America Investment Fund (LAIF), which promotes infrastructure investment in the region. ANDE will use this grant to install 625 000 new electronic meters under its energy loss reduction programme.
The investments under the project are in line with the EIB’s mandate to support economic development in the region. This is its first operation in Paraguay’s public sector. The project will also be financed by other international financial institutions such as the Interamerican Development Bank (IDB) and CAF-development bank of Latin America.
The EIB is providing this loan under the current mandate for lending in Asia and Latin America (ALA IV), which enables it to support investment designed to develop the local private sector, build social and economic infrastructure and mitigate the effects of climate change.