Search

4.83. (...) In 2022, a minimum blend of 10% of biodiesel is required, according to National Energy Policy Council (CNPE) Resolution No. 25/2021. This share should reach 15% in 2023, according to CNPE Resolution No. 16/2018. (...)

4.86. At the end of 2017, Brazil instituted the National Biofuels Policy (RenovaBio), with the objective to contribute to the decarbonization of the Brazilian transport matrix in line with the United Nations Framework Convention on Climate Change 21st Conference of the Parties (COP21) commitments. To achieve this, the programme takes into account the relationship between energy efficiency and the reduction of greenhouse gas emissions (GHG), and it draws on three main instruments: (i) annual carbon intensity reduction targets (CO2/MJ) for a minimum period of 10 years; (ii) certification of biofuels by efficiency in reducing GHG emissions; and (iii) decarbonization Credits (CBio). From these instruments, the environmental costs of using fossil fuels are converted into income for biofuel producers, offering efficiency incentives for their sustainable growth. In 2021, it avoided the emission of 24.4 million tonnes of GHG due to the commercialization of 24.4 million CBios by distributors of fossil fuel, which met about 98% of the 2021 target.

4.92. In 2019, Brazil's ethanol exports averaged approximately 33,000 barrels/day. The United States was the main destination for Brazil's ethanol exports (13,000 barrels/day), mainly through California because of the fuel's favourable treatment compared with domestic corn ethanol under California's Low Carbon Fuel Standard (LCFS), as Brazil's sugarcane ethanol emits less carbon dioxide than corn-based ethanol.

4.94. During the review period, Brazil's biodiesel output grew steadily to 6.76 million m3 (2021), compared to a rise from 2.7 million m3 (2012) to 3.9 million m3 (2015), inter alia, supported by the increase of the biodiesel use mandate (see below). Brazil is the world's third largest producer of biodiesel after the United States and Indonesia. As of 2021, Brazil had 55 plants authorized to produce biodiesel and their capacity represented 35,679 million m3/day.

4.95. The customs tariff on biodiesel (HS 3826) is 12.6%. However, external trade of biodiesel is very low: imports reached USD 119,605 in 2021, USD 23,292 in 2020, and USD 15,751 in 2019, while biodiesel exports reached USD 9 million in 2021, USD 3 million in 2020, and USD 565,661 in 2019.

4.96. The 2004 National Biodiesel Production Programme (PNPB) remains in place. Its aim is to promote domestic biodiesel production, reduce petroleum import dependency, lower pollutant emissions and health-related costs, generate jobs and income, and alleviate regional economic disparities by passing on benefits to family farmers. It is implemented through blending requirements. (...) On 1 January 2022, a new biodiesel commercialization model was implemented, replacing the public auctions for direct negotiations among buyers and biodiesel producers, as defined by National Council for Energy Policy (CNPE) Resolution No. 14/2020, where 80% of the biodiesel market is reserved to sugarcane plants that have the Social Fuels Seal.

4.97. The mandatory blending ratio of biodiesel added to the oil diesel has increased to 12% as of March 2020, in volume, according to Law No. 13,263/2016. Throughout 2020, the percentage of mixture varied from 10% to 11%. In 2021, this mandatory blending ratio varied between 10% and 13%, depending on the auction, as a way to alleviate the impacts of biodiesel high cost on the diesel prices.

4.98. Biodiesel benefits from subsidization through federal tax exemptions and incentives for the Program of Social Integration (PIS/PASEP) and the Contribution for the Financing of Social Security (COFINS) taxes depending on the nature of the raw material, size of producer, and region of production, in order to encourage the production of biodiesel and to promote social inclusion, as well as the Tax on the Circulation of Goods and Services (ICMS) benefits at the state level. This scheme also requires a Social Fuel Seal Certificate. The prices have remained high, over BRL 6/litre since the middle of 2021.

4.99. During the review period, Brazil's installed capacity and power generation continued to grow at a fast pace. In 2021, Brazil had 190.2 GW of installed capacity for electricity generation (140.9 GW in 2015), generated 653 TWh of electricity, imported 23 TWh, and consumed 570 TWh. Hydroelectric sources accounted for 57.5% of installed capacity (65.1% in 2015), followed by wind and solar (17.7%), fossil fuel fired (15.5%), biomass (8.3%), and nuclear (1%) sources. Brazil's shares of renewables in the 2021 installed capacity of electricity was 84%, much above the shares of the world (38%) and the Organization for Economic Co-operation and Development (OECD) countries (40%). Electricity produced by the Itaipu plant and imported from Paraguay continues to account for most of Brazil's imports. In 2021, Brazil imported 17.2 TWh from Paraguay, 3.77 TWh from Argentina, and 2.18 TWh from Uruguay, and exported 0.04 TWh to Argentina. In 2021, the main power consumption groups consist of manufacturing (38.5%), residential consumers (26.6%), service activities (23.4%), agriculture (5.8%), and the energy sector (5.4%). In 2020, Brazil imported USD 1,453.9 million from Paraguay and USD 34,628 million from Argentina, and exported USD 1,950 million to Argentina. New hydro projects were delivered, most notably, the Belo Monte plant in the Amazon Basin, in full operation since 2019, and the fourth largest hydroelectric plant by capacity in the world. Other major hydro projects are being developed, such as the 400 megawatt (MW) Tabajara hydropower project, the 650 MW Bem Querer hydropower project, and smaller hydro projects with 500 MW or less.

4.100. Solar energy in Brazil increased 70% from 2020 to 2021, reaching 13 GW in installed capacity. Energy auctions from solar energy is expected to reach over USD 5 billion in 2022, in addition to USD 1 billion already invested in solar distributed generation since 2012, expected to significantly increase in the coming few years.