May 23, 2005 |
The special terms for renewable energies and water projects will allow borrowers extended repayment terms of 15 years
OECD Countries that participate in the Arrangement on Officially Supported
Export Credits have agreed special financial terms for renewable energy and
water projects, starting on 1 July 2005 for a two-year trial basis. This
agreement will promote the use of renewable energy resources and help increase
access to safe drinking water.
The arrangement is in line with commitments made at the 2002 Johannesburg World
Summit on Sustainable Development and to the Millennium Development Goals.
The special terms for renewable energies and water projects will allow borrowers
extended repayment terms of 15 years; this is comparable to the present credit
terms available for nuclear power plants under an OECD arrangement and is more
favorable than the 12-year terms available for conventional power projects or
the 8.5/10-years for water projects. This will enhance the economic and
financial viability of such projects, encouraging a wider market and general
acceptance of renewable energy technologies especially in developing countries.
The renewable energies covered by the agreement are wind energy, geothermal
energy, tidal and stream power, wave power, solar photovoltaic power, solar
thermal energy, ocean thermal energy and bio-energy. Water projects covered by
the agreement are those related to the supply of water for human use and
wastewater treatment facilities.
The Chairman of the Participants to the OECD Export Credit Arrangement, Ms.
Nicole Bollen, welcomed the agreement, noting that the extended repayment terms
for renewable energy technologies should make these more competitive than
conventional energy sources and those for water projects should improve access
to water and sanitation for developing countries.
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