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Brazil to target 10 pct cut on carbon emissions from fuels sector - Energy Policy Council




By Reuters

Petroleumworld 06 06 2018

Brazil plans to cut carbon emissions from its fuels sector by 10 percent through 2028, forcing distributors to sell more biofuels, the National Energy Policy Council (CNPE) said on Tuesday.

The target is part of RenovaBio, a new federal program designed to gradually increase the share of ethanol and biodiesel in the country's fuel mix. The target released by the CNPE, which will potentially be implemented in 2020, has yet to be approved by President Michel Temer.

The RenovaBio program, which is also meant to support local biofuel producers, could eventually reduce Brazil's sugar production as mills may dedicate a growing share of cane to ethanol production at the expense of the sweetener.


Sao Paulo-based sugar and ethanol consultancy Datagro said on Tuesday that the policies could boost the domestic ethanol market to as much as 47.1 billion liters in 2028, from 26.7 billion liters currently.

Datagro projects biodiesel consumption will jump to 11.1 billion liters in 2028, from 5.7 billion liters currently.

Fuel distributors worry the changes could increase their costs and fuel prices since they add complexity to the business. Under the RenovaBio program, they must buy emissions reductions certificates, called CBios, if they fall short of periodic biofuels targets, just as carbon markets function elsewhere.

André Rocha, head of the National Sugarcane Forum, said the legislation will likely boost investments in the sector and lead to gains in scale and efficiency that will ultimately reduce biofuel costs.


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Reporting by Leonardo Goy; writing by Marcelo Teixeira from Reuters. 06 05 2018

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