(Bloomberg) -- Brazil’s development bank, BNDES, along with government funding agency, Finep, will give 6 billion Brazilian reais ($1.1 billion) in financing to local production of sustainable fuels used to power airplanes and vessels.
The credit lines, which feature subsided interest rates, can be used for expenses including research, engineering projects, industrial plants along with purchases of machinery and equipment, Brazil’s Ministry of Development, Industry, Trade and Services said in a statement.
BNDES could also consider the possibility of investing as a partner in biofuel ventures, for projects that are consistent with green goals, Chief Executive Officer Aloizio Mercadante told journalists.
The move comes amid growing interest in production of sustainable aviation fuel (SAF) in Brazil. Raizen SA, a joint-venture between Shell Plc and Cosan SA, has already announced intentions to build a jet fuel plant, while BP Plc recently acquired a bigger stake at a Brazilian ethanol company that has certified it’s products for SAF. Mubadala-backed Acelen Energia Renovavel SA also plans to start a SAF plant in the state of Bahia, while Petrobras is looking to produce the sustainable fuels in at least two of its refineries.
Mercadante has vowed to fight for investments to stay in Brazil. In January 2023, a subsidiary of Brazilian industrial biotechnology company Granbio announced a project in the US after receiving $80 million grant from the US Department of Energy.
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