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Brazil, a net exporter of crude oil with one of the greenest energy matrixes in the world, remains nearly self-sufficient in primary energy production. Its Ten-Year Plan for Energy Expansion 2024, inter alia, aims at raising the share of renewable sources in the energy matrixes. (...) Biofuel production, an activity subject to cross-subsidization elements, continued to be assisted, inter alia, through: support to sugarcane production and fuel-flex cars; lending incentives to expand the industrial capacity for sugar and ethanol production; and, increased mandatory blending ratios for both gasoline and diesel. The state-owned ELETROBRAS continues to play a major role in the electricity sector. Since 2015, a tariff flag system allowing the monthly pass through of the extra costs of generating thermal energy to consumers has been applied. Electricity tariffs, set by the regulator ANEEL, continue to ensure cross-subsidization among different consumer categories. In addition, the tax burden on end-user electricity tariffs remains significant and differs greatly across consumer groups.

(...) Agriculture also remains an important contributor to the country's energy supply (Section 4.2.3.3) as, inter alia, sugar cane biomass provides over one third of the country's renewable energy output.

During the review period, Brazil's basic agricultural policy and institutional framework remained unchanged. Its main policy objectives consist of expanding grain storage capacity, soil correction and recovery, and agricultural mechanization by fostering investments in these areas. In addition to its three main components, i.e. market price policy, rural credit, and crop insurance Subsidies (Section 4.2.4), which, inter alia, support commercial agriculture and small-scale family agriculture, other important policy measures, including agricultural land zoning and the promotion of biofuels and organic production, contribute to the shaping of agricultural policy. (...)

Table 4.4 Federal Government agricultural support programmes, 2013-16 (prevailing norms for crop-year 2016/17)
Products/projects Beneficiaries Credit limit Annual interest rate Duration Disbursement (R$ million)
Medium-Scale Agricultural Producer Support Programme (PRONAMP)
Investment in goods and services aimed at increasing productivity and income.
Financeable items: financing and investment. In case of financing, it is also allowed to include funds to small expenses considered as investments (repair and conservation of production assets, installation, acquisition of service animals, deforestation) Gross annual income up to R$1.76 million, at least 80% from agricultural activities Financing: R$1.5 million; investment: R$430,000 Financing (working capital and investment): 8.5%; commercialization: 9.5% Financing: up to 2 years; investment: up to 8 years (3 year grace period) 2013: 13,496.3
2014: 19,044.2
2015: 16,843.6
2016: 19,293.9
(...)
Low Carbon Agriculture Programme (ABC Programme)
Projects to reduce greenhouse gas emissions (e.g. recovery of pastures, recovery of degraded areas, organic crops, directing planting, integration of crops, cattle production, forest, forest plantation, environmental recuperation, waste treatment, Dendê plantation, and biological nitrogen fixation) Farmers and cooperatives R$2.2 million; up to R$5 million for planted forests 8.5%; producer placed within PRONAMP framework: 8% Up to 15 years 2013: 608.0
2014: 333.3
2015: 413.8
2016: 681.0
Programme for the Modernization of Agriculture and the Conservation of Natural Resources (MODERAGRO)
Projects related to sanitary and/or environmental adaption needs limited to 35% of the amount of the investment in the following activities/crops: apiculture, aquaculture, poultry, chinchilla production, rabbit breeding, floriculture, fruit, palm trees, olive growing, production nuts, horticulture, sheep and goat farming, milk, fishing, frog culture, sericulture and pig farming.
Combat brucellosis and tuberculosis Farmers and cooperatives Farmers: R$880,00 (individual farmer) and 2.64 million (collectively taken); R$220,000 no PNCEBTa limited to R$5,000 per animal 9.5% Up to 10 years (3 year grace period) 2013: 259.3
2014: 357.3
2015: 626.2
2015: 472.6
(...)

According to the OECD, whereas the agricultural credit system is intended to address failures in financial markets, it also creates risks (default) for government and producers, particularly since the macroeconomic situation has deteriorated (Section 1.2.1). The higher availability of funds for loans is potentially creating excess supply. Most of this credit is concentrated on subsidizing short-term borrowing such as working capital and commercialization loans that further distort markets. A reform of the concessional credit system could consider a gradual downsizing of concessional loans for working capital to commercial producers, simplifying regulations and procedures, and re-focusing to support on-farm investments that explicitly incorporate technological innovations and advanced farm management and environmental practices.

(...) Access of family farmers to the biodiesel market continues to be promoted under the Social Fuel Seal initiative (Section 4.2.3.3.2). (...)

Agricultural insurance support continued to be provided to producers through four main programmes, either in the form of insurance premium subsidies covering the difference between a fixed premium and market rates through a discount in the fee to farmers (fixed percentage), or by compensating farmers for production losses due to natural disasters. (...)

Agricultural zoning requirements continue to link agricultural support to environmental sustainability. They condition producers' eligibility for concessional credit and subsidized insurance programmes. Compliance with zoning applies to all concessional credit and all insurance premium subsidies for any product covered by the zoning (Section 4.2.4.1). In addition, several specific programmes for both the commercial and family farm segments promote sustainable agricultural practices; they include credit for plantings on unproductive and degraded soils, credit for forest planting, and credit to modernize production systems and preserve natural resources (Section 4.2.4.1).

Brazil, a net exporter of crude oil, remains self-sufficient in primary energy (except for natural gas, coal, oil derivatives and hydropower). From January to November 2016 it produced a monthly average of 3.13 million barrels of oil equivalent per day (MMboe/d), up 3.46% compared to the same period in 2015, during which 3.03 MMboe/d were produced. In 2015, the energy matrix produced 286,471 tonnes of oil equivalent (toe) (253,174 toe in 2010), which exceeded by 9.9% (about 5% in 2010) its final consumption. The Brazilian energy matrix remains one of the greenest in the world; in 2015, 41.2% (39.4% in 2014) of energy came from renewable sources compared to an average of less than 15% for the rest of the world. In 2015, it consisted of oil and oil derivatives (37.3%), sugarcane (16.9%), natural gas (13.7%), hydropower (11.3%), wood and vegetable coal (8.2%), coal (5.9%), other renewables (4.7%), uranium (1.3%), and other non-renewables (0.6%). Manufacturing and transport are the major energy consumers and represented 32.5% and 32.2% of final consumption respectively.

Brazil's Ten-Year Plan for Energy Expansion 2024 (Plano Decenal de Expansão de Energia 2024) is focused on striking a balance between the economic growth projections and the necessary expansion of energy supply, as well as ensuring energy supply at the appropriate cost and on a technical and environmentally sustainable basis. It also, inter alia, aims at raising the share of renewable sources in the energy and electricity generation matrixes to 45.2% and 86% by 2024 respectively. To attain these objectives, a total investment of R$1.4 trillion is planned, of which 70.6% in oil and natural gas, 26.7% in electricity, and 2.6% in liquid biofuels. Furthermore, in November 2016, an Investment Partnership Programme set the priority areas for action in energy and mining. These priorities involved bidding rounds of blocks of oil and natural gas, electricity distribution concessions, hydropower plants concessions, and operation/management concessions for mining projects with assets owned by the Mineral Resources Research Company (CPRM). The National Bank for Economic and Social Development (BNDES) would be in charge of the divestment in the electricity distribution service. These bidding rounds provide opportunities for both public and private (domestic and foreign) companies.