São Paulo, Brazil, November 24, 2021 — IFC, a member of the World Bank Group, and CAIXA, a Brazilian state-owned bank, are partnering to structure and implement public street lighting projects for Brazilian municipalities. The goal is to improve the quality of services provided to residents and increase security, helping foster economic growth and the creation of jobs while reducing costs for municipal public administration.
IFC and CAIXA will support municipalities in the modeling, structuring, and implementation of Public-Private Partnership (PPP) projects that will mobilize private investments to modernize and expand their public lighting systems. Some of the main benefits expected include the upgrading of the streetlights, most of which use costly and toxic sodium vapor or mercury to produce light. They will be replaced by LED lights, which international studies have shown can reduce energy consumption by approximately 60%, reducing CO2 emissions; they also provide improved visibility for people and cars, and increase safety by better lighting streets and parks.
The first mandate of this project between IFC and Caixa was signed in 2018, and it was comprised of seven projects. Five of them - Aracaju (Sergipe State), Belém (Pará State), Feira de Santana (Bahia State), Franco da Rocha (Sao Paulo State), and Sapucaia do Sul (Rio Grande do Sul State) - were already auctioned at B3, the Brazilian Stock Exchange, after a competitive tendering process. The two remaining municipalities in this round are Campinas (SP) and Camaçari (BA).
These seven municipalities are receiving about BRL 580 million in private investment to replace 389.000 lamps with LED technology, benefiting 4.5 million people in total while also helping municipalities cut energy costs by 58 percent. This is especially relevant considering that for most Brazilian municipalities, energy consumption is their second-highest expense. The projects are also expected to save about 126.000 tons of CO2 emissions.
For the second mandate, signed in October 2021, another five municipalities have been selected: Ribeirão Preto (Sao Paulo State), Olinda (Pernambuco State), Foz do Iguaçu (Parana State), Ponta Grossa (Parana State) and Timon (Maranhão State). These projects are now in the structuring phase, with kick-of work meetings already scheduled for each municipality. These five new projects, which should mobilize about BRL 233 million in private investments, aim to upgrade about 232.000 lamps to LED technology, benefitting almost 2.4 million people.
Adding to those projects, the World Bank will carry out a process of knowledge sharing with CAIXA and the municipalities. The goal is to support CAIXA in the creation of a broader program that can be replicated to other municipalities, and to prepare those municipalities to manage these contracts once signed.
"IFC is pleased to support the development of projects that provide important advances in people's quality of life and promote business growth," said Carlos Leiria Pinto, IFC's Country Manager in Brazil. "The support of the private sector is essential to help Brazil recover from the impacts of the pandemic and boost its sustainable economic growth."
"IFC's partnership with CAIXA makes it possible to structure projects that will pave the way for several municipalities in Brazil to implement public lighting PPPs. In addition to improving safety and quality of life for the population and fostering business, these projects create significant savings for municipalities, allowing them to increase investments in other areas that are key to the well-being of the population, such as health and education," says Bernardo Tavares, IFC Head of Public-Private Partnerships for Brazil.
The projects are being structured with the financial support of the World Bank, through the Global Infrastructure Facility (GIF), and the Brazilian Government through the Support Fund for the Structuring of Concession Projects and PPP (FEP), coordinated by the Public-Private Partnerships Department (SPPI) and the Ministry of Regional Development (MDR).
About IFC
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2021, IFC committed a record $31.5 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of the COVID-19 pandemic. For more information, visit www.ifc.org.
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IFC and CAIXA will support municipalities in the modeling, structuring, and implementation of Public-Private Partnership (PPP) projects that will mobilize private investments to modernize and expand their public lighting systems. Some of the main benefits expected include the upgrading of the streetlights, most of which use costly and toxic sodium vapor or mercury to produce light. They will be replaced by LED lights, which international studies have shown can reduce energy consumption by approximately 60%, reducing CO2 emissions; they also provide improved visibility for people and cars, and increase safety by better lighting streets and parks.
The first mandate of this project between IFC and Caixa was signed in 2018, and it was comprised of seven projects. Five of them - Aracaju (Sergipe State), Belém (Pará State), Feira de Santana (Bahia State), Franco da Rocha (Sao Paulo State), and Sapucaia do Sul (Rio Grande do Sul State) - were already auctioned at B3, the Brazilian Stock Exchange, after a competitive tendering process. The two remaining municipalities in this round are Campinas (SP) and Camaçari (BA).
These seven municipalities are receiving about BRL 580 million in private investment to replace 389.000 lamps with LED technology, benefiting 4.5 million people in total while also helping municipalities cut energy costs by 58 percent. This is especially relevant considering that for most Brazilian municipalities, energy consumption is their second-highest expense. The projects are also expected to save about 126.000 tons of CO2 emissions.
For the second mandate, signed in October 2021, another five municipalities have been selected: Ribeirão Preto (Sao Paulo State), Olinda (Pernambuco State), Foz do Iguaçu (Parana State), Ponta Grossa (Parana State) and Timon (Maranhão State). These projects are now in the structuring phase, with kick-of work meetings already scheduled for each municipality. These five new projects, which should mobilize about BRL 233 million in private investments, aim to upgrade about 232.000 lamps to LED technology, benefitting almost 2.4 million people.
Adding to those projects, the World Bank will carry out a process of knowledge sharing with CAIXA and the municipalities. The goal is to support CAIXA in the creation of a broader program that can be replicated to other municipalities, and to prepare those municipalities to manage these contracts once signed.
"IFC is pleased to support the development of projects that provide important advances in people's quality of life and promote business growth," said Carlos Leiria Pinto, IFC's Country Manager in Brazil. "The support of the private sector is essential to help Brazil recover from the impacts of the pandemic and boost its sustainable economic growth."
"IFC's partnership with CAIXA makes it possible to structure projects that will pave the way for several municipalities in Brazil to implement public lighting PPPs. In addition to improving safety and quality of life for the population and fostering business, these projects create significant savings for municipalities, allowing them to increase investments in other areas that are key to the well-being of the population, such as health and education," says Bernardo Tavares, IFC Head of Public-Private Partnerships for Brazil.
The projects are being structured with the financial support of the World Bank, through the Global Infrastructure Facility (GIF), and the Brazilian Government through the Support Fund for the Structuring of Concession Projects and PPP (FEP), coordinated by the Public-Private Partnerships Department (SPPI) and the Ministry of Regional Development (MDR).
About IFC
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2021, IFC committed a record $31.5 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of the COVID-19 pandemic. For more information, visit www.ifc.org.
Stay Connected
www.ifc.org/lac
www.twitter.com/IFC_LAC
www.linkedin.com/company/ifc-américa-latina-y-el-caribe
www.facebook.com/IFCwbg
www.instagram.com/ifc_org/
www.youtube.com/IFCvideocasts
www.twitter.com/IFC_org
www.ifc.org/SocialMediaIndex
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