Loans for geothermal projects get first OK

In an unusual showing of cooperation lawmakers have approved unanimously two loans that will finance geothermal projects at the Rincón de la Vieja volcano in northern Costa Rica.

The vote was 49-0 on first reading.

The money comes from the Japanese Agency for International Cooperation and the European Investment Bank. The projects are Pailas II, Borinquen I y Borinquen II.

The Japanese are lending $644 million, and the European source is providing $70 million.

The Instituto Costarricense de Electricidad is installing the thermal generators.

The Japanese loan is for 40 years with a 10-year grace period when the country does  not have to make payments. The European loan is for 30 years with a five-year grace period. Such periods of non-payment are typical in government loans. Both have favorable interest rates, lawmakers said.

The thermal projects will reduce the need for Costa Rica to burn expensive petroleum during the dry season, lawmakers noted.

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