On March 23, the Japan International Cooperation Agency (JICA) signed a loan agreement with Neoenergia Coelba, a company operating an electricity distribution business in the state of Bahia in the northeastern region of the Federative Republic of Brazil under a concession granted by the Brazilian government, and held a signing ceremony in Salvador, Brazil, on June 15.
Scenes from the signing ceremony
This loan will be provided through a syndicated loan arrangement with Mitsubishi UFJ Bank, Ltd. This is JICA’s first Sustainability-Linked Loan (described below) and the first project under the Sustainable Finance Framework with Mitsubishi UFJ Bank (described below). The funds will be used to develop power distribution infrastructure aimed at improving energy efficiency in this state, which is one of the poorest regions in Brazil.
This loan supports projects that contribute to climate change mitigation. As a collaborative project with the host country of the 30th Conference of the Parties (COP30) to the United Nations Framework Convention on Climate Change, held in Brazil in November 2025, this initiative is expected to strengthen the friendly relations between Japan and Brazil, which have maintained diplomatic ties for over 130 years and share a strategic global partnership. Furthermore, this project contributes to the “Latin America and Caribbean Green Investment Initiative,” commonly known as “MIDORI” (described below), which was announced at COP30 and is designed to promote private-sector investment in climate change and environment-related sectors in Latin America and the Caribbean.
・Borrowers
Neoenergia Coelba
・Country (Target Region)
Federative Republic of Brazil
・Loan Amount
15,607,300,000 yen
・Project Name
Project for a Stable Supply of Clean Electricity in the Northeast
・Business Objectives
This project provides incentives in the form of reduced interest rates in response to the borrower’s efforts to digitize the power distribution system and increase the proportion of female electrical engineers, while by providing financing for the capital expenditures necessary to upgrade the distribution grid. The project aims to achieve energy conservation by reducing power losses and ensure a stable supply of electricity in the region—primarily from renewable energy sources—thereby contributing to climate change mitigation and the promotion of gender equality in the electricity sector.
・Business Overview
JICA’s loan funds will be used to upgrade the power distribution network in the state of Bahia, Brazil, in 2026 and 2027.
・Contributing to the SDGs
Goal 5 (Achieve gender equality)
Goal 7 (Affordable and Clean Energy for All)
Goal 10 (End Inequality Among People and Nations)
Goal 13 (Take concrete action on climate change)
Goal 17 (Let’s Achieve Our Goals Through Partnership)
・Reference Information
This project will be implemented as the first project under JICA’s new product, the “Sustainability-Linked Loan (SLL).” The SLL is designed to promote the achievement of sustainable environmental and social goals by adjusting loan terms—such as interest rates—based on whether the borrower has met pre-set targets. In this project, by setting the digitization of the power distribution system and an increase in the proportion of female electrical engineers as SLL targets, we will promote the borrower’s efforts to streamline power distribution operations and advance gender equality in the field of electrical engineering, where women are underrepresented. Through the introduction of this product, JICA will continue to contribute to the realization of a sustainable environment and society while collaborating with private-sector companies in developing countries and regions.
Furthermore, this project is the first to apply the “Sustainable Finance Framework” established under the co-financing arrangement between Mitsubishi UFJ Bank and JICA, which was introduced in July 2025. This framework has received a third-party opinion from an independent external organization confirming that it aligns with and complies with various internationally recognized sustainable finance principles (**) aimed at achieving the SDGs. Consequently, when the two banks provide co-financing for projects that contribute to solving environmental and social challenges based on this framework, such loans can be treated as green loans, social loans, or sustainability loans that comply with the Sustainable Finance Principles. Through the introduction of this framework, JICA will continue to actively promote collaboration with Mitsubishi UFJ Bank to accelerate the mobilization of private capital for the economic and social development of developing countries and regions.
(*) Sustainable finance: The use of capital to address challenges necessary for a sustainable economy and society, while taking into account environmental, social, and governance (ESG) considerations.
(**) The Green Loan Principles, Social Loan Principles, and other guidelines established by organizations such as the Loan Market Association (LMA) and the Loan Syndication & Trading Association (LSTA).
The Latin America and Caribbean MIDORI (Mission for Inclusive Development through Responsible Investment) Initiative was launched at COP30 (held in Brazil) in November 2025. It is an initiative designed to promote JICA’s overseas investment and financing in the Latin American and Caribbean region in the areas of climate change (renewable energy, energy conservation, environment, agriculture, biodiversity, water supply and sanitation, waste management, etc.) in the Latin America and Caribbean region.
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