Brazil’s state-run development bank has approved a 900 million reais (US$380.3 million) line of credit to Energias do Brasil (EDB) to complement the utility’s 4.6 billion reais (US$1.9 billion) investment program for 2008-2012.
Brazil’s Banco Nacional de Desenvolvimento Economico e Social (BNDES) said the revolving credit facility is the first of its kind to be awarded in the electric sector under a direct financing model approved by BNDES in 2005. The financing model was created to simplify large companies’ access to funding without the need for an intermediate financial institution.
EDB, which is owned 64 percent by Energias de Portugal, is to use the funds to finance investment programs of its distribution utilities Bandeirante Energia S.A. and Espirito Santo Centrais Eletricas S.A. (Escelsa) and power producer Energest S.A. EDP said it also plans to use the funds to construct and repower small hydroelectric projects.
BNDES said the money would enable EDP to increase its installed capacity to 2,302 MW from 1,043 MW by 2012.
The funds are available for utilization for five years with a total maturity of up to ten years for each withdrawal.