BNDES bolsters support for energy transition projects

Brazilian development bank BNDES approved financing for a lithium project and is supporting a sustainable aviation fuel SAF initiative, underlining its greater focus on the energy transition.

"Projects associated with the energy transition are initiatives with a huge positive impact on the country's efforts to reduce greenhouse gas emissions, but they will only have a return in the long term, which is why the participation of development banks such as BNDES in financing these projects is essential," Rodrigo Sauaia, the president of solar power association Absolar, told BNamericas.

BNDES approved 487mn reais (US$87mn) for a lithium processing unit at Sigma Lithium's Grota do Cirilo project in Minas Gerais state.

With the proceeds coming from the bank’s New Climate Fund, the company will increase lithium concentrate output from 270,000t/y to 520,000t/y.

“This project approved by BNDES summarizes the objective of the New Climate Fund under the administration of President [Luiz Inácio Lula da Silva], which is to support the green industry in technological development, production capacity and commercialization of goods and services aimed at decarbonization,” BNDES president Aloizio Mercadante said in a statement.

“With this financing, BNDES positions itself at the forefront of the world’s leading development institutions, which operate in countries with long-term industrial policies and are now seeking to bring key links of the foundational industry that supports the value-added chains of inputs for electric vehicle batteries to their respective countries,” Sigma Lithium CEO Ana Cabral-Gardner was quoted as saying in the same release.

BNDES is also involved in a process to provide up to 6 billion reais to finance projects for the production of sustainable aviation fuel. 

Companies interested in producing SAF may submit a business plan through October 31 to obtain funding from BNDES and studies and projects financing agency Finep.

"The goal is to encourage business cooperation and strengthen the first SAF and sustainable fuels ventures for the airline sector in Brazil. The initiative is important to achieve the global goal, proposed by the International Civil Aviation Organization (ICAO), of achieving zero net carbon emissions in international aviation by 2050," a press release by airline regulator ANAC said.

The rules and other details are available here.