CVM's easy-to-use system could boost fundraising for solar energy in Brazil

The raising of funds for solar energy projects via the capital market, which intensified between 2020 and 2021 and cooled with the increase in the Special Settlement and Custody System (Selic), the basic interest rate, may gain additional momentum with the new EASY regime, created by the Securities and Exchange Commission (CVM), assesses the Brazilian Association of Photovoltaic Solar Energy (Absolar).

"There are relevant examples, but the use of the capital markets is still relatively modest compared to the growth potential of solar generation in Brazil. It's possible that FÁCIL will boost access for smaller companies to both debt and equity transactions," Raphael Roque, coordinator of Absolar's Financing Working Group (GT), told Estadão/Broadcast .

"This market is crucial for enabling portfolio expansion across multiple states simultaneously, providing greater predictability for many of our members. The downward trend in interest rates in the future favors the attraction of institutional capital for the energy transition in Brazil," Roque assesses.

However, fixed income is now attracting the majority of investor flow. This scenario led EcoPower to invest in a Real Estate Receivable Certificate (CRI) backed by an installed power plant and inverter to finance the expansion of solar energy capacity.

The fixed-income security, exempt from income tax, targets individual and institutional investors at a time when demand for solar energy is facing difficulties in part of the sector, says Frederico Rocha Melo, the company's CFO.

"There's a large portfolio of prospective clients that can't be served by smaller integrators with tight margins. Larger companies can't tap into this portfolio due to the inefficiency of the Brazilian financial system, as credit is scarce. So, we've moved toward our own CRI," he argues.

The operation was modeled and executed by the strategic consultancy Auddas and reached R$10 million at its debut.

"We've managed to overcome macroeconomic challenges with a company that has the potential to generate more than R$2 billion in operations by 2030. Conversations are underway with institutional investors focused on opportunities in infrastructure and real estate," says Leo Pinho, partner responsible for the Capital area at Auddas.

The securitization of CRIs is carried out by Captable, a platform registered with the CVM, responsible for managing and distributing investments to individuals.

Paulo Deitos, CEO of Captable, comments that the structure of the 'six-handed' operation allowed them to arrive at a design in which 20% of subordinated shares are invested by the partners themselves, which protects investors in senior shares against default.

Debentures

Another fixed-income investment the sector is accessing are incentivized debentures, especially for distributed generation projects—a model in which mini- or micro-generation systems (MMGD) are installed near or at the site of consumption. "It's a structure that has proven effective for financing medium- and large-scale projects," comments Roque.

Attorney Luana Falkenburger, partner at Rolim Goulart Cardoso Advogados, highlights that the changes brought about by Law No. 14,081/24, the so-called infrastructure debentures law, and by Decree No. 11,964/24, which regulated both incentivized and infrastructure debentures, brought photovoltaic solar minigeneration projects closer to these issuances.

However, Provisional Measure No. 1,303/25, issued to compensate for the revocation of the decree that provided for an increase in the Tax on Financial Transactions (IOF), brought uncertainty by containing provisions that could tax the income from these securities.

Absolar endorses this view and states that potential regulatory changes create uncertainty that increases the cost and complexity of operations, in addition to putting pressure on new financing solutions. "The sector is on the right track, but there is still a broad avenue for growth ahead, which also involves the maturation of agents and the strengthening of guarantees," Roque argues.

In addition to the use of incentivized debentures, infrastructure, and CRIs for different funding strategies, Roque is betting on strengthening investment funds, such as Equity Investment Funds (FIPs) and Credit Rights Investment Funds (FIDCs), in future stages.