By Brazil Stock Guide – Japan International Cooperation Agency, JICA, has approved a R$ 764 million loan to Neoenergia Coelba to help modernize Bahia’s electricity distribution grid, reinforcing Iberdrola’s investment push in one of Brazil’s largest and most important energy markets.
Neoenergia Coelba, controlled by Neoenergia, Iberdrola’s Brazilian subsidiary, will use the funds to improve energy efficiency, service quality and supply reliability across Bahia, the largest state in Brazil’s Northeast region.
The financing is structured as a sustainability-linked loan, with conditions tied to sustainability indicators. According to the company, it is the first JICA loan globally to follow this structure and marks the debut of a sustainable financing model developed by the Japanese agency together with MUFG Bank.
The transaction also fits into the cooperation agenda linked to COP30, held in Brazil in November 2025, and is part of JICA’s Midori Initiative, created to support green-sector investments outside Japan, with a focus on Latin America.
The loan comes as Neoenergia prepares a major investment cycle in Bahia. The company plans to allocate nearly R$ 25 billion to electricity infrastructure in the state by 2030 through Neoenergia Coelba. The program includes the construction of 54 new substations, more than 2,000 kilometers of high-voltage lines and 42,000 kilometers of medium-voltage networks.
Bahia is expected to absorb around half of Neoenergia’s planned distribution-network investments over the next five years. The company has said total investments in distribution in Brazil should reach about R$ 50 billion following the recent renewal of its concessions.
For Neoenergia and Iberdrola, the financing strengthens a long-term strategy focused on grid expansion, renewable integration and service quality. For Bahia, it brings additional capital to a power system that will need to support industrial growth, new renewable generation and rising electricity demand over the coming years.