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Organization for Economic Cooperation and Development extended maximum repayment term from 15 to 18 years
U.S. exports to renewable energy, water and nuclear power projects are now eligible for a maximum repayment term of up to 18 years under export financing provided by the Export-Import Bank of the United States (Ex-Im Bank). The new maximum term is available for transactions approved on or after July 1, 2009.
The longer repayment term may be applied to Ex-Im Bank’s direct-loan or loan-guarantee financing in accord with agreements of the Organization for Economic Cooperation and Development (OECD) that permits export-credit agencies of OECD countries to offer enhanced terms for renewable energy, water and nuclear power projects. Financing for these projects is also eligible for more flexible definitions of repayment schedules. A revised fixed-interest rate regime applies to the longer loan durations. The changes are in effect until 2013, when the agreements are scheduled to be reviewed and revised.
The OECD recently extended the maximum repayment term from 15 to 18 years and adopted the other changes to facilitate financing to these types of projects, which are associated with higher capital costs. Hydropower and nuclear-power projects also have longer construction periods than projects employing more conventional technologies.
“The 18-year and flexible repayment terms offer greater financing flexibility for U.S. exporters of goods and services to renewable-energy, water and nuclear-power projects,” said Ex-Im Bank Chairman and President Fred P. Hochberg. “The new terms provide incentives and will help to make these projects more competitive and enable us to support more American jobs in these industries.”
U.S. exports associated with the following types of water projects are eligible for the revised terms: treatment and distribution of drinking water for human consumption, collection and treatment of residential and industrial wastewater, water recycling and treatment of water-related sludge.
Ex-Im Bank created its Office of Renewable Energy and Environmental Exports in 2007 to conduct proactive outreach to U.S. exporters of renewable-energy technologies and other environmentally beneficial goods and services. The Bank’s Environmental Exports Program has supported more than $3 billion of U.S. environmentally beneficial exports since its inception in 1994.