Two subsidiaries of Brazilian energy group Neoenergia completed green bond issuances totalling R$1 billion in December 2025, becoming the first entities to raise capital under Brazil's federal Eco Invest sustainable finance programme. Bradesco BBI acted as sole coordinator and ESG adviser on both transactions, which carried a ten-year tenor and were structured in compliance with both Eco Invest rules and the International Capital Market Association's Green Bond Principles.
The proceeds from the bonds are earmarked for a package of electricity network upgrades including smart grid deployment, underground cabling of existing overhead lines, and substation modernisation. These categories align with the infrastructure investment priorities set out under the Eco Invest framework, which was established by the Brazilian federal government to channel private capital into environmentally beneficial projects by providing a defined eligibility structure backed by official guidelines.
ECO INVEST FRAMEWORK SETS NEW BENCHMARK
The Eco Invest programme represents a significant development in Brazil's sustainable capital markets architecture. By providing a government-endorsed framework with defined green eligibility categories, the programme reduces the due-diligence burden on investors who would otherwise need to evaluate each issuance against multiple voluntary standards. The fact that Neoenergia's bonds are the first to be completed under the programme gives them a landmark quality that is likely to attract attention from ESG-focused institutional investors domestically and internationally.
Bradesco BBI's role as sole coordinator and ESG adviser places Banco Bradesco's investment banking arm at the centre of this inaugural transaction. The bank was responsible for structuring the bonds in a manner that satisfied both the Eco Invest requirements and the ICMA Green Bond Principles, the latter being an internationally recognised voluntary framework that specifies how proceeds should be used, managed, and reported. Alignment with ICMA standards is important for accessing the global green bond investor base, which increasingly requires adherence to recognised principles as a minimum condition for participation.
Neoenergia is one of Brazil's largest electricity distribution and transmission groups, with operations spanning several states. The company's focus on smart grid technology and network modernisation reflects the broader demands of Brazil's energy transition agenda, which requires substantial capital investment in grid reliability and capacity to support the integration of renewable generation.
SMART GRID INVESTMENT DRIVES USE OF PROCEEDS
The specific use-of-proceeds categories — smart grid deployment, line undergrounding, and substation upgrades — address tangible infrastructure needs within the Brazilian electricity system. Smart grids reduce technical losses, improve fault detection, and enable more efficient integration of distributed renewable energy sources such as solar rooftop installations, which have grown rapidly across Brazil in recent years. Underground cabling reduces the vulnerability of distribution networks to weather events, an increasingly relevant consideration given the frequency of extreme conditions across the country.
The ten-year maturity of the bonds provides Neoenergia with long-duration funding appropriate for infrastructure assets with similarly extended useful lives. For investors, a ten-year green bond from a regulated utility backed by a government-endorsed framework offers a combination of credit quality and ESG credibility. The successful completion of these inaugural transactions under Eco Invest is expected to encourage further issuances by other Brazilian utilities and infrastructure operators in the months ahead.