Grupo Cocal is receiving $70 million (£50.9m) in funding to expand ethanol and biogas production in Brazil; diversifying the country’s energy mix.
IFC is providing $40 million (£29m) of the funding, with the remaining $30 million (£21.8m) provided by Banco Itaú BBA and Rabobank.
Grupo Cocal is set to build a biogas production unit in Narandiba, renovate 27,000 hectares of sugarcane and replace agricultural machinery and equipment to farm more sustainably.
The company will produce biogas, biomethane and electricity from vinasse and filter cake, which are by-products of the sugarcane milling process.
Cocal aims to eventually replace diesel with biogas in its automotive fleet and then distribute it to homes, businesses and industries across the State of São Paolo in July 2022.
Carlos Leiria Pinto, IFC’s Country Manager in Brazil, said: “This project is aligned with one of IFC’s pillars in Brazil, which is to make environmental and social sustainability a business driver for agribusiness.
“Increasing the share of sustainable biofuels and clean energy in the country’s energy matrix is strategic for Brazil to reach the goals established in the Paris Agreement.”