The Inter-American Investment Corporation has approved a loan of up to US$12 million to Peruvian company Huaura Power Group S.A. to fund the construction and operation of the 17.4-MW C.H. Yarucaya hydropower plant.
The run-of-river project, to be located on the Huaura River in Peru's Sayan District, is expected to begin operations in December 2016.
"With the Yarucaya hydroelectric plant coming online, our group changes its role of investors in the power sector to one of developer of power generation projects," Huarura Power Group general manager Alfonso Bustamante said. "This is the start of a series of new renewable energy projects that will have a low environmental and social impact, low installation cost, and high importance for a power system that is ever more dependent on natural gas."
IIC said it was able to progress with the loan process after previously approving technical, commercial and financial feasibility studies of the project.
"With this operation, the IIC will be supporting the development of small-scale hydroelectric projects in Peru by providing long-term financing, IIC lead investment officer Olga Lucia De Narvaez said. "This hydroelectric project will also be a source of low-cost energy that will help meet growing demand."
HydroWorld.com reported in January that the IIC-funded 5.3-MW Canchayllo hydroelectric plant in Peru's Junin province had begun production.
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