Costa Rica hopes to harness the power of the Rincón de la Vieja Volcano for three new geothermal projects announced Tuesday at Casa Presidencial.
During a signing ceremony Tuesday morning, President Laura Chinchilla announced that the Japanese International Cooperation Agency (JICA) would extend Costa Rica a $560 million loan to build three geothermal power plants near the famous volcano in the northwestern province of Guanacaste.
Costa Rica hopes that the additional electricity generated by steam from the volcanic area will help the country reach its goal of generating 95 percent of its electricity with renewable resources by 2014.
Geothermal power plants capture steam produced by heat from the Earth – a volcano in this case – to turn turbines that then generate electricity.
The first of the proposed plants, Pailas II, will have an electrical generation capacity of 55 megawatts and will cost more than $333 million to build, according to a statement from Casa Presidencial.
The costa Rican Electricity Institute, or ICE, will construct two other 50-MW power plants, Borinquen I and II, 40 kilometers away from the Pailas geothermal plants.
“This is 165 MW of reliable [electricity generation]; that is to say, they will operate 24 hours a day, 365 days a year. This is clean, renewable and reliable energy, as reliable as any conventional thermal electrical power plant,” said ICE Executive President Teofilo de la Torre.
De la Torre said the geothermal power plants would generate the lowest cost electricity in the country, at 5 cents per kilowatt-hour.
ICE, a state-owned utility and telecommunications company, inaugurated the first such power plant, Pailas I, outside the Rincón de la Vieja National Park two years ago. None of the additional three proposed plants will be inside the park, said de la Torre.
The Central American country will have 40 years to pay back the $560 million loan at a 0.6 percent interest rate. JICA offered a grace period on the loan where Costa Rica will pay only interest for the first 10 years.
Earlier this year, environmental concerns over geothermal energy in the national park system sparked debate over the limits of using protected land for extractive purposes. The Legislative Assembly will review the project during upcoming extraordinary sessions.