The Inter-American Development Bank (IDB) has finalized a $150m non-sovereign guaranteed loan to help finance the construction of a 406MW capacity hydroelectric plant in Peru.
The $1.2bn Hidroeléctrica de Chaglla project will help the country meet growing demand for energy while helping to diversify its energy matrix and reduce its carbon footprint.
In addition, the project will be the country´s second largest hydropower power facility, representing about 13% of the country's installed hydropower capacity.
Construction work on the hydro project is scheduled to be completed by 2016.
The plant is expected to prevent greenhouse gas emissions of approximately 467,000 metric tons of carbon dioxide equivalent annually.
IDB project team leader, Esteban Sarzosa said this project will make a significant contribution to Peru's economic development.
"It advances the delivery of environmentally responsible and socially sound infrastructure by incorporating sustainable solutions such as biodiversity conservation, local employment and capacity building" added Sarzosa.
The IDB loan will be granted to Empresa de Generación Huallaga, a subsidiary of Odebrecht Energia, both of which are part of Brazil's Odebrecht Group.
Furthermore, the IDB loan will also help finance the construction of related infrastructure, including the transmission line linking the plant to the national electricity grid, access roads and other ancillary facilities.