Brazil

 

Since 2004 Brazil has succeeded in reducing GHG-emissions through enhanced control and monitoring of illegal deforestation. New export markets and petroleum reserves are however increasing the political and economic costs of mitigation.

By Solveig Aamodt


Summary

  • Brazil is the ninth largest energy consumer in the world
     
  • The Amazon rainforest hosts the world’s largest carbon stock
     
  • Brazilian GHG-emissions were 1568 million tons CO2 equivalents in 2013
     
  • Deforestation, energy and agriculture each contribute roughly 1/3 of the emissions
     
  • Growing fossil fuel production and consumption cause increased CO2 intensity

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Key Facts

Brazil is the fifth largest country in the world in terms of population and territory. It is currently the world’s seventh biggest economy and, if emissions from deforestation, agriculture and land-use change are included, it is the fifth largest GHG-emitter. As an integrated part of the Brazilian growth strategy, energy independence and security have been important driving factors in energy policy since the 1950s. Large national investments in hydropower, biofuels and petroleum development have resulted in a relatively clean energy matrix where 45 per cent of total energy consumption is renewables. In 2009 Brazil pledged a voluntary target to reduce GHG-emissions with 36 to 39 per cent below business as usual by 2020. 

Between 2004 and 2012, the deforestation in the Amazon was greatly reduced. At the same time, emissions from energy consumption grew as a result of increased transport and deep-water oil production off the Brazilian coast. 

The increase in oil production and a price cap on petrol have led to reduced production of biofuels. This, in addition to increased road transport of consumption goods and agricultural products, has caused growth in Brazil’s CO2 intensity, increasing the overall carbon footprint of the Brazilian economy.
 

Policy Supply and Demand

From the United Nations’ Rio Summit in 1992, Brazilians have felt committed to the UNFCCC process and to act as an environmentally conscious people. This stance is augmented by the country’s unique biodiversity. In 2009 Brazil reached an important milestone with being one of the first countries to adopt a comprehensive climate law. Nevertheless, recent developments show a priority of economic growth over climate and environment in Brazilian policy-making. The revisions in the forest code that were approved in 2012, has been criticised by environmentalists for giving amnesty to former deforestation violators and allowing land-use change in formerly protected areas. Deforestation in the Amazon and Cerrado forests has increased since 2012.

The increasing importance of the petroleum sector in the Brazilian economy is making mitigation more costly. The reductions in deforestation had seemingly few negative effects on economic growth, but reducing the petroleum production would be both economically and politically painful and is therefore not likely to happen. 
Drivers and Barriers
Maintaining a good relationship with old and new export markets is essential for Brazilian business.  In 2009, expectations about carbon taxes in the EU and US made business actors support Brazil’s contribution to global mitigation and the domestic climate law. 

Much of the deforestation in Brazil has been driven by exports of agricultural products such as soybeans and beef, while other sectors of Brazilian industry are relatively clean due to hydropower electricity. 
 
The best mitigation opportunities in Brazil can still be found in deforestation control and in improving the efficiency and progress of ethanol fuel. The latter could reverse the growing use of diesel and petrol in the transportation sector. 

Brazil has a strong environmental movement that has been an important driver for improved deforestation-control. It has however been difficult for the environmentalists to impact the strong ties between politicians and industry interests in the energy sector. So far there has been very little focus on the petroleum in the climate debate.  The government maintains that all energy resources are crucial for economic development, and the Brazilian environmental movement has lost much of the mobilization power it had when the climate law was adopted in 2009. 

In international polls Brazilian respondents are among the ones most concerned about global warming. But concerns for education, health and economic development seem more immediate for Brazilian voters. The government plans to meet these concerns with welfare reforms funded by resource rents from the booming petroleum sector. 
 

The Future

Although an ongoing corruption scandal in the national oil company and the fall in international oil prices are complicating the future in the Brazilian petroleum sector, the sector is likely to increase its influence in Brazilian energy policy. Both the government and environmentalists are however eager to see new growth in the biofuels sector, so biofuels production is likely to increase. With falling prices, wind and solar are becoming competitive in Brazil, so these energy sources are expected to grow, although they do not receive subsidies from the government. However, due to an expected doubling of overall energy use, the renewable share in the total energy matrix is unlikely to increase.

The reduced emissions from deforestation have given Brazil an advantageous position internationally. And the country will continue to emphasise the historical mitigation responsibility of the Annex-1 countries in the climate negotiations. As a member of the BASIC group (Brazil, South Africa, India and China), Brazil is unlikely to be a frontrunner in accepting binding mitigation targets for non-Annex-1 countries. Nevertheless, Brazil is known for being a pragmatic international actor, and few of the country’s arguments in the climate negotiations are likely to be treated as absolutes if there is more to gain from changing strategy.