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German bank to finance El Salvador’s first solar plant

KfW Bankengruppe to finance CEL’s solar first for Central America’s smallest country

El Salvador’s first solar power project is set to start development in 2013

A German bank is to finance the development of El Salvador’s first solar power plant. Plans are underway for the country, the smallest in Central America, to start construction on the solar farm next year, which will begin operation in 2014.

Comision Ejecutiva Hidroelectrica del Rio Lempa (CEL), El Salvador’s state-owned utility, is planning the nation’s first utility-scale solar project, according to reports.

Moreno Ramon, a spokesman for the San Salvador-based utility, said CEL will auction development rights for the 14.2 MW solar farm in 2013, Bloomberg reported.

CEL is seeking a consulting company to draft auction documents for the solar farm, which will be financed by KfW Bankengruppe, Germany’s state development bank, he said. It’s expected to go into operation in 2014.

Plans are also underway to develop a 42 MW wind farm in 2014.

The wind project in the northern city of Metapan will cost about USD 110m and is expected to start producing power in 2015.

“Wind and solar energies offer a good potential and allow a way to diversify the electric generation mix in the country,” Moreno said.

A shortage of new sites for large hydroelectric dams in El Salvador has prompted CEL to consider alternative sources of electricity. The country has no large wind or solar projects connected to its power grid now.

CEL, which operated four hydroelectric dams with 472 MW of generation capacity in 2009, is still deciding whether it will own the projects or sign long-term contracts to buy the electricity they produce, Bloomberg said.