Brazil to Establish Renewable Energy Fund of Up to $6.5 Billion

Brazil’s government is creating an investment fund that will seek as much as 20-billion reais ($6.5 billion) to boost solar and wind generation in the country’s northeastern region.

The fund will be composed of private investors and state-owned utility Cia. Hidro Eletrica do Sao Francisco, known as Chesf, Brazil’s Energy Minister Eduardo Braga told the Senate’s Committee on Infrastructure Services conference on Wednesday.

“We are on the eve of a major announcement,” Braga said, according to a statement on the Ministry’s website. “With the fund, subsidies will no longer be a burden for Brazil’s Treasury and become a catalyst for Northeast region development.”

Chesf, which receives government subsidies for power purchases, will no longer receive such financial aid. The fund will be managed by the investment arm of the government’s National Social and Economic Development Bank, known as BNDES.

Private investors will have a 51 stake in the fund with Chesf owning the remaining 49 percent.

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