Brazil Secures $15.6M for Pioneering Biodiversity Restoration in Atlantic Forest

Brazilian forest restoration company re.green has secured R$80 million ($15.6 million) in financing from Climate Fund managed by the Brazilian Development Bank (BNDES), a landmark transaction in uniting biodiversity conservation with climate finance. The deal is the first to apply a biodiversity label to a restoration initiative in Brazil, an uptick in recognition of nature-based solutions in sustainable finance.

This funding is backed by a private guarantee issued by Bradesco and is structured with ESG advisory services by Bradesco BBI. It bears a "Dark Green" S&P Global Shades of Green rating—the maximum level of environmental integrity in international sustainable finance norms. It signifies compliance with guidelines formulated by organizations like the International Capital Market Association (ICMA), Loan Market Association (LMA), and International Finance Corporation (IFC).

The funding enables restoration of ecological functioning in more than 16,000 hectares of degraded forest within Brazil's Atlantic Forest and Amazon biomes. Both biomes are globally recognized for their value in regulating the climate and conserving biodiversity. The project is one of the elements of the wider "Arco da Restauração" program restoring ecological functioning in these critical forest ecosystems.

This deal stands out by using private finance to mobilize public climate money, laying the groundwork for a repeatable model that uses forest restoration as critical infrastructure. It is also the first payment from Arco da Restauração program since re.green's first financing deal inked last year.

The deal also marks the first occasion on which a biodiversity-company has drawn upon the Climate Fund under an internationally recognized framework, marking an improvement in the manner in which climate finance can be utilized to meet biodiversity goals.

BNDES, Brazil's national development bank, plays a crucial role in undertaking this task, investing federal resources to combat climate change via large-scale environmental restoration. The financing structure involves risk reduction through the involvement of more than one party, building investor confidence in environmental restoration as an asset class.

The funds will be used to pay for re.green's inaugural solo contract for creating high-quality carbon credits from processes such as preparing soil, planting, and keeping native tree species in place—some of which are threatened. Advanced monitoring techniques using drones and LiDAR technology will offer open and accurate reporting of restoration activity.

Community engagement is also central to the project. To date, re.green has been able to restore more than 26,000 hectares in the Amazon and Atlantic Forests by planting more than 4.5 million seedlings of more than 80 indigenous species. Restoration is supported by 29 local nurseries and generated more than 200 direct jobs. Nearly 300 community members have been trained in activities such as seed harvesting, fire management, and stingless beekeeping, improving livelihood and ecosystem well-being.

re.green has been rewarded with many awards for its work, such as an AAe rating by BeZero Carbon, which is among the world's leading carbon credit rating entities, placing it among the world's very best when it comes to climate integrity.

This historic financing contract is expected to set a precedent for the use of biodiversity labels in restoration finance and demonstrate how mainstream climate investment can be made through nature-based solutions. It also highlights Brazil's increasing pledge to defend and restore its central forest ecosystems as well as drive sustainable economic growth. 

Source: Climate Fund managed by Brazilian Development Bank (BNDES)