The Guarantee Fund for Credit to Energy Efficiency (FGEnergia) of the National Bank for Economic and Social Development (BNDES) will receive R $ 30 million from the National Electricity Conservation Program (Procel). The non-reimbursable funds will be used to support energy efficiency projects in different sectors of the economy, through the provision of guarantees.

According to the bank, the guarantee system reduces the risk of default assumed by financiers. The expectation is to increase the borrower's access to credit. "The fund's guarantee mechanism provides for the coverage of part of the risk of financial agents with these operations, through the granting of guarantees that may reach 80% of the total credit, and will be subject to the validation of technical project criteria related to energy efficiency. ", says the BNDES in a note.

With this volume of initial investment, FGEnergia will be able to generate guarantees for approximately R $ 200 million in energy efficiency projects throughout Brazil., Highlights the institution. Among the 29 projects that qualified in the process of prioritizing resources in Procel's 3rd Annual Investment Plan (PAR), FGEnergia developed by the bank in conjunction with the Financial Innovation Laboratory (LAB), was ranked second.

According to the BNDES, the increase in the efficiency of the national energy system will have significant impacts on the productivity of the economy, on the reduction of fossil fuel consumption and on the emission of greenhouse gases, contributing to a more sustainable Brazil.

Now that it has been selected, the fund must fulfill the following phases of structuring, internal approval and implementation by BNDES, with support from LAB and in partnership with the Procel team. "In its first phase of operation, FGEnergia will serve as a pilot for future fundraising by third parties, with impact investors, national and international".

For the superintendent of the Energy Area of the BNDES, Carla Primavera, the experience and scope of the institution in this area will be fundamental for the progress of the project. Taking advantage of this experience, FGEnergia will also add the bank's technical knowledge on the energy sector for the validation of operations, through the application of a qualitative assessment tool for projects submitted to the fund by agents, noted Carla.

The BNDES also informed that, alongside the Inter-American Development Bank (IDB), one of the institutions that make up the LAB, it will work together to raise new funds for FGEnergia. The intention is to establish dialogue with international funds focused on combating climate change and sustainable global growth, such as the Green Climate Fund, the Sustainable Infrastructure Program and the German development bank KfW.

Procel was created in 1985 to encourage actions aimed at increasing efficiency in the use of energy and the adoption of more conscious consumption habits. The program is coordinated by the Ministry of Mines and Energy and carried out by Eletrobras.