Brazilian biofuels get $1bn vote of confidence
In one of the largest cleantech deals of the year and a ringing endorsement of the booming Brazilian biofuel sector, Sao Paulo-based Vital Renewable Energy Company (VREC) has announced this week that it has secured over $1bn (£680m) of funding from a group of US, European and Middle Eastern investors.
The company said that the investment would be used to help fund a wide range of renewable energy projects across Brazil, mainly focused on ethanol production and electricity generation.
"As a result of more than 20 months of detailed industry analysis and the review of numerous agricultural-industrial projects, we selected a portfolio of initial investments focused on ethanol production and associated energy generation capable of delivering the returns expected by our investors" said Ricardo Roccia, chief executive of VREC.
He added that the company had already inked a major alliance with Grupo Farias, a sugarcane and ethanol producer with more than 10.5 million tonnes of installed sugar cane crushing capacity, and had begun work on its first production facility.
It is also expected to use the funding to construct ethanol refineries that feature integrated electricity generation, expand ethanol facilities and make " opportunistic investments" in distressed ethanol firms.
Michael Steed, founder and managing partner of Paladin Capital Group - which led the investment round alongside Leaf Clean Energy Company, Petercam Asset Management and PCG Clean Energy & Technology Fund - said that Brazil represents one of "the most exciting frontiers for growth in the renewable fuels sector", adding that VREC is "well-positioned to take advantage of the enormous global market opportunity for sugar-based ethanol".
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