Dominican Republic to boost energy efficiency with IDB loan
Washington.- The goals of the plan include strengthening the electricity sector’s institutional and supervisory capital and enhancing sectorial planning and regulation. At the same time, the loan will help support better management and operations at electricity distribution companies.
The idea of strengthening the electricity sector’s institutional and supervisory capital includes improving the supervisory capacity of its operational and financial leaders by providing more transparent information. It also includes boosting oversight of the wholesale electricity market to increase efficiency in power generation.
Enhancing sectorial planning and consolidation of the regulatory framework aims to ensure efficient expansion of electricity generation and transmission systems; boost efficiency in the management of demand for electricity, for which it was agreed that the Ministry of Energy and Mines would enhance its institutional capacity for the development of energy efficiency programs; and support the design and implementation of a new and efficient utility rate regime that will favor sustainability in the sector.
The government of the Dominican Republic undertook a reform process in the sector in 2011, when the IDB approved the first in a series of three Programmatic Policy-based Loans – the $200 million Program for Sustainability and Efficiency in the Electricity Sector. It was designed with the goal of seeking to implement measures agreed on by the government, the International Monetary Fund and multilateral banks as part of the Electricity Sector Action Plan for 2010-2015.
The $400 million IDB loan is over 20 years with a one year disbursement period, a grace period of 5.4 years and an interest rate pegged to the LIBOR.