AES El Salvador Deferred Electricity Receivables Purchase Facility (IDBI-13110-01)

  • El Salvador
Geographic location where the impacts of the investment may be experienced.
Financial Institutions
  • IDB Invest (IDBI)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Voting Date
Jul 2, 2020
Date when project documentation and funding is reviewed by the Board for consideration and approval. Some development banks will state a "board date" or "decision date." When funding approval is obtained, the legal documents are accepted and signed, the implementation phase begins.
Compania de Alumbrado Electrico de San Salvador, S.A. de C.V. (CAESS), Empresa Electrica de Oriente,
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
  • Energy
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 60.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Loan Amount (USD)
$ 60.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Primary Source

Original disclosure @ IDBI website

Updated in EWS Jun 26, 2021

Disclosed by Bank May 8, 2020

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

The proposed transaction is a payment facility to purchase accounts receivable for up to USD 120 million ("The Facility" or "The Transaction") that will be used to discount electricity bills issued by four (4) electricity distribution companies in El Salvador: i) Compania de Alumbrado Electrico de San Salvador, SA de CV (CAESS); ii) Empresa Electrica de Oriente, S.A. de C.V. (EEO); (iii) AES CLESA S. en C. de C.V. (CLESA); and iv) Distribuidora Electrica de Usulutan (DEUSEM) (hereinafter "AES El Salvador" or "the Companies"). The Companies are controlled, and majority owned by The AES Corporation. The invoices arise from Executive Decree No. 12 of the Executive Body (dealing with COVID-19) for the Health Sector of March 21, 2020, for the deferral of payment of electricity consumers' invoices, in order to address the Companies' liquidity and working capital needs. The credit line will be available for up to three months and the deferred invoice payments shall be repaid in 24 monthly installments.

People Affected By This Project
People Affected By This Project refers to the communities of people likely to be affected positively or negatively by a project.

1. General Information of the Operation

The operation consists of the creation of an uncommitted receivable purchase facility to finance the deferral of payments of end-user electricity bills in El Salvador, resulting from the implementation of the measures provided for in Presidential Executive Order #12 in response to the impact of the COVID-19 virus. This Executive Order provides for the suspension of electricity payments for three months beginning in April 2020, without incurring any late charges or interest fees, or affecting end users' credit ratings. The funds obtained from the transaction will be used solely to cover the temporary lack of liquidity resulting from the enforcement of Presidential Executive Order #12 in the Companies.

The environmental and social analysis of the proposed transaction consisted of a documentary review of the Companies' environmental and social performance over time, underscoring compliance with the following Performance Standards(PS): PS 1: Assessment and Management of Environmental and Social Risks and Impacts; and PS 2: Labor and Working Conditions; PS 3: Resource Efficiency and Pollution Prevention; and PS 4: Community Health, Safety and Security.

3. Environmental and Social Categorization and Rationale

This transaction has been classified as a Category C operation under the IDB Invest Environmental and Social Sustainability Policy, given that its incremental impacts will be practically negligible and that the resources obtained from the transaction will not be used to make any capital investments but only to provide liquidity to the Companies while the economic restrictions generated by the COVID-19 pandemic endure.

4. Environmental and Social Risks

4.1 Assessment and Management of Environmental and Social Risks and Impacts

All the Companies have their respective Environmental Permit (equivalent to an environmental license) issued by the Ministry of the Environment and Natural Resources (MARN, for its Spanish acronym) upon approval of the corresponding Environmental Impact Study (EIS). This study includes plans, programs and actions to prevent, mitigate and compensate for the environmental and social risks that have been identified as relevant in their respective studies. These prevention, mitigation, or compensation actions are carried out through a solid environmental and social management system (ESMS), which has been implemented in the Companies in recent years.

Environmental verification has allowed us to confirm that the Companies have substantially and consistently complied with the requirements of their respective Environmental Permits.

4.2 Labor and Working Conditions

Labor issues are very well regulated in El Salvador in terms of working hours, wages, vacations, workers' compensation, and labor regimes, among other aspects.

Given that El Salvador is a signatory to several conventions of the International Labor Organization (ILO), including Convention No. 87 concerning Freedom of Association and Protection of the Right to Organize and Convention No. 98 concerning the Right to Organize and Collective Bargaining; Convention No. 100 concerning Equal Remuneration for Men and Women Workers for Work of Equal Value and Convention No. 111 concerning Discrimination in Respect of Employment and Occupation; Convention 135 concerning Worker's Representatives; Convention 151 concerning Occupational Safety and Health; the Salvadoran Labor Code force recognizes the following rights of workers, regardless of the contractual regime binding them: (i) non-discrimination; (ii) remuneration for work performed; (iii) rest days, holidays, leaves of absence, bonuses and other benefits; (iv) non-exploitative working hours; (v) freedom of association and collective bargaining; (vi) occupational health, safety and security; (vii) social security; (viii) decent treatment; (ix) maternity leave and nursing, in the case of women; (x) retirement, pension or annuity; (xi) job stability or tenure; (xii) promotion or advancement; and (xiii) death benefit and life insurance.

The Companies comply with the requirements of the Salvadoran State in matters of labor and working conditions.

4.3 Resource Efficiency and Pollution Prevention

The Operation, being a commercial transaction of deferral of payments, will neither generate pollution nor demand the use of natural resources.

4.4 Community Health, Safety and Security

The Companies have their respective emergency prevention and response plans in place and duly approved through their Environmental Permits. The review conducted shows that, to date, no situations have arisen that could have endangered the health or safety of the population.

5. Proposed Management Measures

The reports regularly submitted by the Companies to the environmental authority (MARN) indicate that the management measures contained in the approved plans and programs included in the approved EISs are being implemented as planned.

6. Environmental and Social Action Plan

Given the characteristics of the operation, no Environmental and Social Action Plan is required.

Additional information:

For inquiries about the Project, contact:

Manuel Perez-Benitoa R.

Debt Compliance Specialist

+ (507) 6485-2836

For questions and comments to IDB Invest please contact:

IDB Invest Communication Group

Additionally, affected communities can access the IIC's Independent Consultation and Investigation Mechanism (ICIM) as follows:

Phone number: +1 (202) 623-3952

Fax number: +1 (202) 312-4057

Address: 1350 New York Ave. NW Washington, DC. USA. 20577



Investment Description
Here you can find a list of individual development financial institutions that finance the project.
Private Actor 1 Private Actor 1 Role Private Actor 1 Sector Relation Private Actor 2 Private Actor 2 Role Private Actor 2 Sector
- - - - AES Corporation Buyer -

Contact Information
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

Manuel Perez-Benitoa R.
Debt Compliance Specialist
+ (507) 6485-2836


The Independent Consultation and Investigation Mechanism (MICI) is the independent complaint mechanism and fact-finding body for people who have been or are likely to be adversely affected by an Inter-American Development Bank (IDB) or Inter-American Investment Corporation (IIC)-funded project. If you submit a complaint to MICI, they may assist you in addressing the problems you raised through a dispute-resolution process with those implementing the project and/or through an investigation to assess whether the IDB or IIC is following its own policies for preventing or mitigating harm to people or the environment. You can submit a complaint by sending an email to You can learn more about the MICI and how to file a complaint at,1752.html (in English) or,1752.html (Spanish).

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