Summary of Proposed Investment
Project Number
9624
Company Name
C.A. La Electricidad de Caracas
Date SPI Disclosed
May 17, 1999
Country
Venezuela, Republica Bolivariana de
Industry
Infrastructure
Status
Completed
Sector
Distribution Business
Department
Gbl Infrastructure & Natural Resources
Environmental Category
B - Limited
Previous Events
Approved : Jun 29, 1999
Signed : Jan 19, 2000
Invested : Feb 22, 2000
Project Description
Summary Of Project Information (SPI)
| Project Name: | Venezuela - EDC |
Region:Latin America and Caribbean
Sector:
Project No:009624
Projected Board Date:June 16, 1999
Company Name:C.A. La Electricidad de Caracas, S.A.C.A. ("EDC")
Technical Partner and/or Major Shareholders
EDC is a vertically integrated private company which owns and operates 2,265 MW of capacity and distributes power to the Caracas area. In 1998 its sales revenues were about US$763 million equivalent and year-end total assets amounted to US$3.3 billion and net worth of US$2.6 billion. Net income for the year was US$128 million with an EBITDA of US$387 million.
In addition to EDC, the EDC Group includes Corporación EDC which holds and develops international operations and non-regulated Venezuelan businesses including electricity services, gas, water and telecommunications. Corporación EDC has acquired CORELCA and EPSA, a distribution company and a vertically integrated company respectively in Colombia and CAESS and EEO, two distribution companies in El Salvador.
Project Cost Including proposed IFC investment
Total project cost is estimated at US$100 million. IFC''S proposed investment is a US$40 million "A" loan.
Location of project and Description of site
The project is located in the capital city of Caracas and its suburbs.
Description of Company and Purpose of Project
EDC is a private Venezuelan integrated electricity utility serving the Caracas area. Founded in 1895, EDC (the Company) is the largest listed company on the Caracas stock exchange and is owned by over 68,500 shareholders. The Company serves a population of 4.5 million people and has over 1 million customers.
IFC is considering extending a corporate loan in the form of a US$40 million "A" Loan and a US$35 million "B" Loan.
Environmental Category and Issues
This is a category B project according to IFC’s environmental and social review procedure. The project includes significant environmental benefits (such as loss reduction and energy efficiency components) and social benefits (for instance, provision of electricity to previously unserviced neighborhoods). As this is a corporate loan, the environmental and social review of this project focused on: (i) the capacity of EDC to implement environmental and social programs, and (ii) compliance of the project''s sub-projects within the corporate loan with the applicable IFC environmental and social guidelines and policies. A specialist from the environmental and social review unit met with the Environmental Health and Safety Department at EDC and visited several of the project sites to be financed by the corporate loan. EDC’s Environmental Health and Safety Department has a history of positive participation in EDC''s developmental and operational activities. The project will comply with IFC''s environmental and social guidelines and policies. Independent audits of the Environmental Health and Safety Department''s capacity in twenty areas were completed in 1995 and 1998, and a third audit is scheduled for 2001. The transmission lines component will not involve any relocation, land is being acquired in accordance with IFC’s Involuntary Resettlement Policy, and EDC does not use herbicides in the maintenance of its transmission lines Right of Way. The transmission lines will not involve people resettlement.
While it is not contemplated that IFC''s corporate loan would finance the generation side of EDC, IFC’s environmental specialist has concluded that the two generating stations (installed capacity of 2140 MW) comply with the IFC Guidelines for Thermal Power Plants, except for one area. The older gas plants do not comply with the Guidelines with respect to NOx emissions. However, these older plants are to be phased out and replaced by combined cycle technology, which will be in compliance with World Bank environmental guidelines. This is anticipated to be achieved in 2002. Also, the new operations of EDC are PCB free. The Company has disposed of 99.8% of its accumulated PCBs with the remaining to be disposed of by the end of the first quarter of 2000. This disposal program is in compliance with the IFC Guidelines. Across EDC, health and safety practices are state-of-the-art and housekeeping practices at all facilities conform with best international practice.
The is from the InfoShop.
| Host country location of environmental documents | Venezuela and the United States of America |
Date SPI sent to InfoShop May 17, 1999
“This Summary of Project Information is prepared and distributed to the public in advance of consideration of the proposed transaction by the Corporation’s Board of Directors. It is provided for the purpose of enhancing the transparency of IFC’s activities and should not be construed as presuming the outcome of IFC Board consideration.”
For Additional Information contact: Corporate Relations Unit -
telephone: (202) 473-7711
facsimile: (202) 974-4384
Environmental documents for this project are available at http://www.ifc.org and from the World Bank InfoShop (http://www.worldbank.org/html/pic/aboutinfo.html).
Sponsor / Cost / Location
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