Geothermal Exploration Program and Improved Power Transmission in the framework (IADB-NI-G1006)

  • Nicaragua
Geographic location where the impacts of the investment may be experienced.
Financial Institutions
  • Inter-American Development Bank (IADB)
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
Sep 7, 2016
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.
Ministry of Energy and Mines (MEM)
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)
$ 9.52 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.
Project Cost (USD)
$ 9.52 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 @ IADB website

Updated in EWS Jun 22, 2017

Disclosed by Bank Aug 25, 2016

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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.
This project aims to contribute to the sustainability of the energy sector in Nicaragua. The specific objectives are: (i) to develop the geothermal potential to diversify the energy matrix; and (ii) to increase the accessibility and reliability of the energy service supply through the increase in national and regional transmission capacity by implementing reinforcements to the grid. The various components of this project include (i) feasibility level exploration of the Cosigüina field with geothermal potential, (ii) development of a mechanism to attract private investment for the implementation of geothermal projects, (iii) improvements in electricity transmission infrastructure, (iv) address of growing demand and new generation connection. The program was classified as a category “A” operation. If not mitigated, the adverse environmental and social impacts would be significant. They are: (i) habitat fragmentation and cumulative effects on the forest cover caused by habitat conversion within the Cosigüina Volcano Natural Reserve; (ii) the risk of cumulative effects on water availability caused by extraction and consumption of water for Component 1, which could affect the viability of both Component 1 and the health of surrounding communities; (iii) a high risk of natural disasters that could affect the viability of the projects under Components 1 and 2, and the health and safety of surrounding communities, such as seismic activity, drought, extreme precipitation and storms, landslides, and volcanic activity; (iv) impacts associated with the construction phase of projects under Components 1 and 2, such as contamination of surface water and groundwater and soil by sludge from drilling, air pollution, generation of noise and vibrations, visual impacts, potential pollution caused by poor waste management, and impacts associated with access and the obtaining of easements; and (v) negative impacts on the economic potential of both neighboring owners and the affected communities.
Investment Description
Here you can find a list of individual development financial institutions that finance the project.
The program is a specific investment loan. It will be cofinanced with loan proceeds from the IADB and from the Korean Facility for infrastructure projects, as well as CTF and SREP contributions as part of the PINIC. The total cost of the program is US$103,403,000. Of this amount, US$28,700,000 corresponds to blended financing (US$17,220,000 or 60% from OC funds, and US$11,480,000 or 40% from the Fund for special operations); US$39,694,000 as part of the Grant Leverage Mechanism (GLM) of the IDB (US$22,670,000 from the OC under the GLM and US$17,024,000 in non-reimbursable funds, including US$750,000 from the Scaling Up Renewable Energy Program (SREP) in non-reimbursable investment funds, US$6,750,000 from the SREP and US$9,524,000 from the Clean Technology Fund in non-reimbursable contingent grant funds). In addition, US$25,000,000 in a concessional loan under the Korea Facility for infrastructure projects (KIF), administered by the IADB, and US$10,009,000 will be financed with local funds from the governmental agencies and will basically be used to cover administrative, financial expenses, and contingencies. The expenditure categories that will be covered by the program include procurement of goods, works, services, consulting assignments, program financing costs, and administration expenses for the program execution unit. Resources will be disbursed over a period of five years.

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.
ACCOUNTABILITY MECHANISM OF IADB 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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