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The European Union is providing €300 million in financing to Neoenergia’s Bahia distribution utility, Coelba, to modernize and expand one of Brazil’s largest electricity networks. Announced at COP30 in Belém, the investment supports a multi-year plan to upgrade the grid across Bahia, Brazil’s fifth-most-populous state, where Coelba delivers power to more than six million customers in over 400 municipalities.
The funding will be used to expand the network, connect new customers, and introduce advanced grid automation and digital systems. These upgrades are expected to improve service reliability, reduce energy losses, and help the grid integrate a larger share of renewables such as wind and solar, which are rapidly growing in Brazil’s Northeast. The program is also designed to bring more stable, cleaner electricity to underserved and low-income communities, supporting both energy access and climate goals.
This financing aligns with the EU’s Global Gateway strategy, which focuses on sustainable infrastructure investment worldwide, and with Brazil’s national efforts to strengthen the networks needed for its energy transition. By directing long-term capital into distribution grids, often the bottleneck for renewable growth, the EU aims to accelerate Brazil’s shift toward a cleaner, more resilient energy system.
The European Investment Bank highlights that the loan is structured on competitive terms and backed by strict environmental, social, and technical standards. Only utilities that meet strong international criteria typically qualify, demonstrating the project’s high-quality governance and sustainability credentials.
The investment also supports Neoenergia’s broader strategy. The company, majority-owned by Spain’s Iberdrola, has been prioritizing regulated network assets as a key area for growth in Brazil. The EU’s backing provides the financial stability needed to advance Bahia’s large-scale grid modernization efforts, preparing the system for rising electrification, digital demand management, and continued expansion of renewable generation.
In essence, the €300 million investment gives Bahia a critical boost: strengthening its power grid, improving service quality, and enabling a smoother, faster clean-energy transition, while advancing shared sustainability priorities for both Brazil and the European Union.
Source:
https://esgnews.com/eu-backs-brazils-grid-overhaul-with-327m-financing-for-neoenergia/
