EUR 200m investment to support climate action projects in Brazil
EIB loan to support new wind parks and a photovoltaic plant in the northeast region in Brazil
First visit of EIB Vice President Ricardo Mourinho Félix, to Brazil, announcing strengthened EIB engagement in the region with the launch of EIB Global
The European Investment Bank (EIB) and Brazilian energy utility company Neoenergia have signed a EUR 200m loan to finance renewable energy projects in Brazil.
The EIB loan will allow Neoenergia to build a wind park in Chafariz and a solar power plant in Oitis, in the northeast region in Brazil. The new agreement will support a series of onshore wind farms, grouped into two clusters, located in the Brazilian states of Paraíba, Piauí and Bahia, as well as a solar PV plant to be built in Paraíba approximately 10 km away from the wind cluster. The power generation capacity of the project is 715.5 megawatts (MW), comprising of 566.5 MW of wind power and 149 MW of solar photovoltaic energy. Neoenergia is one of the largest energy distributors in Brazil.
The loan is an example of joint EU efforts under “Team Europe” and highlights our priorities in Latin America: contributing to sustainable and inclusive growth and promoting Climate Action.
Speaking at a signature ceremony in Rio de Janeiro, EIB Vice-President Ricardo Mourinho Félix, responsible for Latin America said: “Clean energy is essential for sustainable growth. We are pleased to be signing this EUR 200m loan agreement for renewable energy projects in Brazil with Neoenergia. We recently formally launched our development branch - EIB Global which will strengthen our activities outside of the European Union, including in Latin America. Today’s announcement highlights EIB priorities in Brazil and Latin America, supporting a sustainable and inclusive economic growth by boosting productive investment.”
Neoenergia CEO, Mario Ruiz-Tagle said: “Neoenergia has been following the path of energy transition and the fight against climate change for many years. Our first wind farm, for example, is almost 20 years old. We are going through a time when investment in the energy sector directly impacts a greener future. The financial sector has an essential role in mobilizing the capital needed to develop sustainable projects, as well as ensuring that the company's activities are responsible and in line with best practices within the ESG dimensions.”
The agreements with the European Investment Bank reinforce Neoenergia's commitment to accelerating the integration of low or no carbon energy solutions in the business. The funds will be allocated to strategic projects for the company, such as the Neoenergia Chafariz Wind Farm (PB), which has just been delivered, in addition to the Neoenergia Oitis Wind Farm (PI and BA), under construction, as well as solar parks such as Neoenergia Luzia, whose works have already begun. With this transaction, Neoenergia gains new access to a line of development that contributes to the construction of high quality assets in Brazil, where we have been present for 25 years, being one of the leaders in the sector in the country, with a very important role in the defense of equality of gender, through various initiatives such as schools for electricians, increasingly with the presence of women in their classes, and in support of sport with the impetus of women's football”.
EU Ambassador to Brazil, Ambassador Ignacio Ybáñez Rubio, said: “The European Green Deal is inspiring the current cooperation agenda between the EU and Brazil, giving special importance to the promotion of sustainable development and post-COVID recovery. EIB financing contributes to Brazil’s efforts towards SDGs 2030 targets and climate neutrality by 2050. We welcome the EIB’s the renewed financing of Neoenergia on renewable energy projects, whose is backed up by EU guarantees. This new credit line is an important component of our Team Europe support to scaling up renewable energy infrastructure in Brazil.”
Promoting female education and professional development
Neoenergia invests in the welfare and development of both its employees and members of the communities in which it operates. In particular, Neoenergia's School of Electricians launched a women-only training program in 2019. It was recognized by UN Women as an example of promoting women's education and professional development and was awarded the XI Premio Corresponsables de Iberoamérica.
First visit of the Vice President to Brazil
The Neoenergia announcement took place during the five day visit to Brazil. EIB Vice President, Ricardo Mourinho Félix opened the ABDE Development Forum event in Brasilia in Brasilia where Head of the Latin American office, Alexandre Staff Varela participated as a panellist alongside participants from the Bank for International Settlements (BIS), World Bank (WB), AFD and Desenvolve SP. Following the launch of EIB Global this year, the visit will enable a closer working relationship with Brazilian authorities including the ministerial, banking and regional representatives the delegation is meeting this week.
EIB Global: a new partner for Team Europe
Last year, the EIB Group provided EUR 8.1 bn of financing to projects in more than 160 countries outside the European Union including Brazil, bringing the total amount of investments outside the EU to more than EUR 1.5 tn.
In January 2022, the EIB announced establishment of EIB Global, its branch dedicated to international partnerships and development finance. EIB Global will bring together all of the EIB’s resources and expertise gained outside the European Union under a clear management structure that can make a stronger, more focused contribution to Team Europe projects and initiatives.
The EIB in Brazil
The EIB has significant presence in Brazil through the financing of important public investment projects. Brazil is the largest recipient of EIB financing in Latin America with EUR 4.7 bn of funds provided since the Bank started working in the country in 1997.
In recent years, the EIB has financed strategic investments in Brazil in the energy, water, telecoms, urban development sectors, including the Copasa water and sanitation project in Minas Gerais and credit lines with Brazilian banks such as BDMG, BNB and BRDE.
Since the EIB began operating in Latin America in 1993, it has provided total financing of EUR 11.4 bn to support 150 projects in 15 countries in the region.
This is the EIB’s fifth signature with the Neoenergia Group and marks over 10 years of cooperation between the two institutions.
EIB Global is the EIB Group’s new specialised arm dedicated to increasing the impact of international partnerships and development finance. EIB Global is designed to foster strong, focused partnership within Team Europe, alongside fellow development finance institutions, and civil society. EIB Global brings the Group closer to local people, companies and institutions through our offices across the world.
Neoenergia is a publicly traded company with shares (NEOE3) traded on the São Paulo Stock Exchange. Part of the Spanish group Iberdrola, the company has been operating in Brazil since 1997 and is currently one of the leaders in the country's electricity sector. Present in 18 states and the Federal District, its businesses are divided into the areas of generation, transmission, distribution and commercialization. Its distributors, Neoenergia Coelba (BA), Neoenergia Pernambuco (PE), Neoenergia Cosern (RN), Neoenergia Elektro (SP/MS) and Neoenergia Brasília (DF) serve more than 15 million customers, equivalent to a higher population to 37 million people.
Neoenergia has 4 GW of installed generation capacity, 88% of which is renewable energy, and is implementing another 0.7 GW with the construction of new wind farms. In transmission, there are 2,300 km of lines in operation and 4,300 km under construction. Through the Neoenergia Institute, it promotes sustainable development based on socio-environmental actions and, thus, contributes to improving the quality of life of the communities where the company operates, especially the most vulnerable people, always aiming for sustainable development. The company is the first company in the country to exclusively sponsor the Brazilian Women's Soccer Team, naming the national competition, which is now called the Brasileirão Feminino Neoenergia. Since January 2021, it has been part of the B3 Corporate Sustainability Index portfolio – Brasil, Bolsa, Balcão – which brings together companies that have the best governance and corporate sustainability practices.
Ricardo Mourinho Félix, Vice President of the European Investment Bank, will lead a high-level delegation, alongside the EU Ambassador to Brazil, Ignacio Ybáñez Rubio, during his first visit to Brazil as Vice President responsible for the region.
The EIB will facilitate EUR 150m to EDPR Brazil, the local subsidiary of EDP Renovaveis (EDPR), a global leader in the renewable energy sector, to support the development of wind and solar power generation plants in Brazil.This institutional credit will contribute to foster the company’s business plan in Brazil, a country where it has been present for the past decade and where its project pipeline will enable EDPR to produce nearly 1,8 TWh a year of clean energy by 2023.