IFC and Grupo Equatorial Form Strategic Alliance to Upgrade Brazil's Power Grid

The International Finance Corporation (IFC), a member of the World Bank Group, has signed a significant strategic alliance with Brazil's Grupo Equatorial to enhance Brazil's power distribution system, increase system reliability, and finance the country's green transition as the country witnesses increasing energy demand.

Under the deal, IFC will offer a loan facility of up to $250 million to finance one or more subsidiaries of Grupo Equatorial. The initial commitment, closed on March 28, is a green loan of up to $100 million to Equatorial Alagoas Distribuidora de Energia S.A., with at least one additional loan due by year-end 2025.

Tackling Infrastructure Gaps Through Private Sector Support

Brazil's energy industry is increasingly under pressure to expand infrastructure while cutting greenhouse gas emissions. For the World Bank Group, it will take average annual investments worth 3.7% of GDP to bridge the infrastructure gap and achieve the country's 2022-2030 development goals.

IFC's financing of private-sector infrastructure participants such as Grupo Equatorial is critical to overcoming these challenges

Temel Öktem, IFC Regional Industry Manager for Latin America and the Caribbean, said, “Modernizing and strengthening Brazil’s power distribution system is critical to fostering economic growth and enabling sustainable development.”

He added, “IFC’s partnership with Grupo Equatorial will help increase the sustainability of Brazil’s energy sector and improve the country’s resilience.”

Empowering Underserved Communities in Alagoas

The initial green loan will enhance energy access and reliability for 1.4 million customers across 102 municipalities in Alagoas, one of Brazil’s most economically disadvantaged states.

Grupo Equatorial’s capital investments will particularly benefit low-income communities, with at least half of the resulting service improvements reaching underserved populations.

Grupo Equatorial, a major player in Brazil’s transmission and distribution sector, will use the financing to expand network capacity, reduce losses, and improve service quality, with a focus on minimizing outages caused by severe weather.

Beyond funding, IFC will provide capacity building and help align Equatorial Alagoas with IFC’s Performance Standards on Environmental and Social Sustainability, raising the bar for ESG performance in Brazil’s energy sector.

Also read: IFC Partners with Santander Chile for $100 Million Green Building Loan

Strengthening Global Energy Innovation

The partnership also marks Grupo Equatorial’s entry into the IFC Future Grids Alliance, a global initiative launched in 2024 to accelerate sustainable energy infrastructure development. As part of this alliance, Grupo Equatorial will collaborate with global utility leaders to advance innovation, knowledge sharing, and tailored investment strategies.