El Salvador’s Legislative Assembly Finance Committee has issued a favorable opinion on a government initiative seeking to provide a sovereign guarantee for a $150 million loan from the International Bank for Reconstruction and Development (IBRD). The loan will be signed by the Executive Hydroelectric Commission of the Lempa River (CEL) and is intended to fund the “Geothermal Energy Project for the Sustainable and Inclusive Development of El Salvador.”
The decision came after lawmakers heard from Marlos Herrera, Director General of Public Investment and Credit at the Ministry of Finance, who outlined the project’s general and specific objectives, financial conditions, and investment components.
According to Herrera, the government aims to “increase electricity generation capacity based on the country’s existing geothermal resources,” and “contribute to the stabilization of electricity prices.”
He also noted that the project seeks to reduce El Salvador’s dependence on regional energy imports, which are often affected by seasonal weather patterns such as droughts and heavy rains. “This initiative also addresses climate change by lowering greenhouse gas emissions,” Herrera added.
The committee’s favorable opinion and the proposed decree will be presented to the full Legislative Assembly in the upcoming plenary session scheduled for Thursday.