The municipality of São Paulo, Brazil, is set to receive a $248.3 million loan from the Inter-American Development Bank (IDB) to support the electrification of its public bus fleet. The funding, recently approved by the IDB, will enable the deployment of approximately 2,200 electric buses as part of the city’s broader transition to cleaner public transport.
São Paulo has already integrated 527 electric buses into its network, but the new financing marks a major boost to its electrification ambitions. The loan will also support operational enhancements under SPTrans, the city’s public transport authority, which oversees a fleet of more than 12,000 buses servicing 1,300 routes and over 20,000 stops. According to SPTrans, the system currently consumes over 400 million liters of diesel annually.
The IDB loan has a 15-year term with a six-year grace period and will carry an interest rate tied to the Secured Overnight Financing Rate (SOFR). In addition to the electrification effort, the funds will go toward improving transport infrastructure, with a focus on serving São Paulo’s seven million daily bus riders and the broader population of 21.5 million in the Metropolitan Region.
“It is a central part of the IDB’s support strategy for Brazil to promote initiatives like this one, which allow us to advance environmental and social issues at the same time,” said Annette Kilmer, the IDB’s representative in Brazil. “More efficient, punctual and cleaner public transportation is also an important vector for combating inequalities, and it is an honour to support the city of São Paulo in this agenda.”
The initiative aligns with São Paulo’s climate commitments, following a 2022 decision by SPTrans to prohibit new diesel bus purchases in compliance with national environmental legislation. The program specifically aims to benefit low-income citizens and women, who comprise a significant portion of the city’s public transport users.