Ecuador to improve access to electricity in rural and marginal urban areas

The Inter-American Development Bank (IDB) has approved a $40 million loan with which Ecuador will increase and improve access to electricity in rural and marginal urban communities.

"The loan will finance projects that will connect 30,000 households in rural and marginal urban areas to electrical power and improve the service that 210,000 other homes have today," said IDB project team leader Arnaldo Vieira de Carvalho.

To ensure economically viable, sustainable, reliable, and high-quality access to electricity, the project includes institutional strengthening and training in the formulation, implementation, monitoring, and economic and financial evaluation of rural electrification projects.

Bringing electricity to a community typically allows for a longer workday in the home and the use of tools that increase domestic productivity. By the project’s completion in 2013, the reading time available to children and adults in dwellings receiving electricity for the first time will increase 50 percent; the sense of security and quality of life in benefited communities is expected to rise 40 percent; and the projected number of economically active persons per household and of businesses per community will double.

In 2009, an estimated 92.6 percent of Ecuadoreans had electricity (95.7 percent in urban areas and 84.7 percent in rural areas). Preliminary data from the 2010 census indicate that approximately one million people had no electricity. The government is targeting 97 percent national coverage by 2013.

The IDB has supported the development of Ecuador’s electricity sector for more than 40 years.

The loan is for 25 years, with a two-year grace period and an interest rate based on LIBOR. The Ministry of Electricity and Renewable Energy, supported by the National Electricity Board, is responsible for the project, which is part of Ecuador’s Program for Rural and Marginal-Urban Electrification (FERUM).

IDB. News Releases.Nov 3, 2011