Ecological Transformation Plan increases Climate Fund resources by 316 times
The Ministry of Finance reported this Friday (3) that the Ecological Transformation Plan increased the Climate Fund's resources by 316 times. For this year, the forecast of available resources is R$27.5 billion compared to R$0.09 billion in 2020.
The main sector financed by the Climate Fund is energy transition (R$ 12.5 billion), with emphasis on projects in renewables and biofuels (biomethane).
From 2023 to 2025, the Climate Fund portfolio also expanded investments in areas such as green industry, sustainable urban development, forests and water resources, green machinery and equipment, green logistics and mobility.
On the public financing front, Brazil raised US$5.5 billion in sustainable sovereign bonds between 2023 and 2025, in operations aimed at ecological projects. The initiative is part of the Ecological Transformation Plan, implemented in the first year of government.
According to the special advisor to the Ministry of Finance, Rafael Dubeux, the government expects that funding via sustainable sovereign bonds will follow the same level of magnitude observed in previous years, between US$1 billion and US$3 billion in 2026.
"The idea is to remain at this level to preserve the interest rate curve that brings liquidity to the movement of these securities", said Rafael.
See the total value of bond issues per year:
- US$ 2 billion raised in 2023;
- US$ 2 billion in 2024;
- US$ 1.5 billion in 2025.
On the private capital mobilization front, Eco Invest Brasil concluded four auctions, with a forecast of R$141 billion in total investments.
The program works to reduce financial and exchange rate risks to attract long-term investments in areas such as energy transition, recovery of degraded lands, green infrastructure and adaptation, among others.
Of the total foreseen in Eco Invest Brasil, R$100 billion were leveraged with private capital and R$41.6 billion correspond to public catalytic capital. The government also predicts that around R$63 billion will be raised abroad.
See other highlights from the Ecological Transformation Plan review:
- National Fund for Scientific and Technological Development: the resources committed increased from R$1.9 billion in 2021 to R$30.7 billion in 2025. In projects with high technological risk, such as hydrogen, biofuels, sustainable aviation fuel and mineral transformation, subsidies increased to R$7 billion in 2025.
- Development Letters of Credit: totaled R$16.3 billion in emissions by the BNDES, BRDE and BDMG. The instrument supports strategic sectors, such as industry, micro, small and medium-sized companies and modernization of rural production;
- Concessional climate funds: Brazil raised US$6 billion in concessional climate funds between 2023 and 2025, with 41 projects financed.
- Brazilian Climate Investment Platform: brings together 20 projects in the pipeline, with US$26.5 billion in total investment potential and US$4.1 billion already confirmed. The initiative promotes the connection between national and international projects, funds and investors, as well as the structuring of investment pipelines aligned with ecological transformation.
- Incentive and infrastructure debentures: issuances totaled R$396 billion between 2023 and 2026, compared to R$137 billion between 2019 and 2022. This is an increase of more than 180%.
Source: CNN