$30M IFC Loan for Brazilian Energy Efficiency and Renewables

A loan of $30 million to Banco Caixa Geral of Brasil (BCG) funding renewable energy projects to mitigate climate change in Brazil has been made by International Finance Corporation (IFC).

The IFC, a member of the World Bank Group, is making the five year loan to BCG, which is part of Caixa Geral de Depósitos Group (CGD), a world player in renewable energy financing.

Investment in renewable energy is a key development priority for IFC, as it helps diversify Brazil’s energy matrix, create jobs, and support the economic development while reducing reliance on fossil fuel based sources. With IFC’s investment, BCG will invest in projects that promote energy efficiency and use of renewable energy, aiming to reduce greenhouse gas emissions (CO2).

“We welcome IFC’s first climate-smart investment in BCG. Natural resources play an important economic role, contributing to social and economic development and the well-being of present and future generations”, says Henrique Cabral Menezes, BCG CEO in Brazil. “With IFC’s investment, BCG will also enhance its social and environmental policies, anticipating the trend for stricter regulatory requirements for financial institutions.”

“IFC is pleased to partner with BCG to support expansion of climate-smart projects, which play an increasing role in helping the expansion of power supply in Brazil in a sustainable manner”, says Hector Gomez Ang, IFC Country Manager in Brazil. ”Diversification of energy sources is a key component of Brazil’s long-term competitiveness and sustainable social and economic growth.”

In the last five years, BCG advised and structured financing to various infrastructure projects in Brazil amounting to USD 10 billion, USD 2.5 billion of which for renewable energy and sanitation. This is in line with the global strategy of CGD, which was recognized as the “Best Sustainable Bank in Europe” by the New Economy magazine in 2010, 2011 and 2012.

IFC’s renewable energy strategy is to invest in technology, scale and new business models to reduce renewable energy cost so that it becomes a widely used source of power and supports expansion of access to energy in emerging markets. Since 2005, IFC has invested more than $11 billion in 600 climate-related projects that have helped developing countries meet their energy needs while supporting a green growth path.

Picture of Parque Eólico de Osório - Wind Farm in Brazil, aerial picture taken by Bernardo Fiusa reproduced under CCL.

Wednesday 15th October 2014

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