Brazilian Development Bank finances its first solar project

The Brazilian Development Bank (BNDES) has financed its first-ever solar plant in the country, providing project finance for the under-construction 192MW Pirapora I plant owned by EDF Energies Nouvelles and Canadian Solar.

In a “landmark transaction”, the BNDES is supplying R$529m ($163m) of project finance for the Pirapora I project, which is slated to reach completion shortly in the state of Minas Gerais, Canadian Solar chief executive Shawn Qu says.

The 18-year financing facility is funded entirely from the Brazilian Long Term Interest Rate (TJLP), meaning it is partially subsidised.

The BNDES has been a major funder of Brazilian wind projects over the years, although its role in the market is set to shrink as Brazil attempts to undertake a series of pro-market reforms.

Canadian Solar won a contract to sell power from the Pirapora I project in a 2015 auction that shone a spotlight on Brazil’s huge solar potential. Late last year it sold 80% of the project to EDF EN do Brasil, the company’s local subsidiary. EDF has previously won financing from BNDES for wind projects in the country.

Canadian Solar is supplying modules for the plant out of the panel-assembly plant it built in Sao Paulo state to satisfy Brazil’s local-content requirements. The factory, operated by Singapore-based Flex, was the first opened in Brazil by a top-tier global solar company. Since then, China’s BYD has opened a smaller solar factory in Brazil.

Brazil entered 2017 with around 100MW of installed solar, but it is expected to end the year with nearly 1GW – and the market is expected to continue expanding in the years ahead.

Read Next

Brazil's renewables sector places trust in team Coelho Filho

DISPATCHES | Alexandre Spatuzza explains how Brazil's renewables industry has come to see its pro-reform energy minister as a beacon of stability in a storm of political uncertainty

12 Jun 15:23 GMT