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CLIMATE
ACTION
TRACKER
BROWN TO GREEN:
G20 TRANSITION TO A LOW CARBON ECONOMY
Brazil
This country profile assesses the Brazil’s past, present and indications of
future performance towards a low-carbon economy by evaluating
emissions, decarbonisation, climate policy performance and climate
finance. The profile summarises the respective findings from, amongst
others, the Climate Change Performance Index (CCPI, operated by
Germanwatch and Climate Action Network Europe), the Climate Action
Tracker (CAT, operated by Climate Analytics, NewClimate Institute,
Ecofys and Potsdam Institute for Climate Impact Research), and
analyses from the Overseas Development Institute (ODI).
Human Development Index
Share of global
GHG emissions
GHG emissions
per capita
0.82
G20
average
15*
5.7%
8.7
1
G20
average
G20 average
Source: UNDP, data for 2015
Source: World Bank Indicators, data for 2012
2500
7
6
5
1500
4
3
1000
2
500
1
Emissions per capita (tCO2/capita)
2000
0
30
20
26
20
22
20
20
18
14
20
10
20
06
20
02
20
98
19
94
19
90
0
19
$
3%
$
$
$ 15,071
$ 12,982
Source: IEA, data for 2013
*World Bank indicators were used as a source of greenhouse gas emissions for all countries to ensure comparability and coverage of most recent years.
These estimates differ from what countries report in their national communications. Per capita emissions of Brazil would be 6.4 tCO2e/cap in 2010 when
using the greenhouse gas emission estimate from the third national communication reported by Brazil. Brazil has not report emission estimates after 2010.
GREENHOUSE GAS (GHG) EMISSIONS
Total emissions (MtCO2e/a)
GDP
per capita
(tCO2e/cap)
0.75
0
Share of
global GDP
Historic emissions
(excluding forestry)
Energy-related
CO2 emissions
Energy-related
CO2 emissions per capita
Current policy emissions projections
(excluding forestry)
Historic forestry
emissions/removals
G20 average of energy-related
CO2 emissions per capita
In Brazil, GHG emissions have risen since 1990, a
trend likely to continue to 2030. Land use, land-use
change and forestry (LULUCF) emissions play a
major role in Brazil’s GHG profile. At their 1995 peak,
they were nearly triple those of all GHG emissions
from other sources, but have now declined. Since
2011, LULUCF emissions have been lower than
energy-related CO2. Energy-related CO2/capita have
risen, but are well below G20 average. CCPI 2016
rates Brazil’s emissions as relatively good, but
growing energy-related emissions per capita
account for a negative trend.
Composition of
GHG emissions
30%
N O 13%
CH 28%
F-Gases 1%
CO2*
2
4
CCPI evaluation of emissions level and trend
Level
Weak trend
very poor
poor
medium
good
very good
Strong trend
CO2 emissions
from forestry 28%
*CO2 emissions excl. LULUCF
Source: Annex I countries:
UNFCCC (2015); Non-Annex I
countries: IEA (2014) and CAT (2015)
Sources: Past energy related emissions from the Climate Change Performance Index (CCPI); past non-energy and future emissions projections from the Climate Action Tracker (CAT).
CCPI calculations are primary based on the most recent IEA data; CAT calculations are based on national policies and country communications.
Brown to green: G20 transition to a low carbon economy
Brazil - Country Profile
DECARBONISATION
Energy intensity of the economy
CCPI evaluation of renewable share in TPES
10
The energy intensity of Brazil’s economy (TPES/GDP) has
remained at about the same level throughout recent
years, in contrast to most G20 countries, which have
falling energy intensity rates. Nevertheless, Brazil’s
energy intensity remains below the G20 average. The
CCPI evaluates the energy intensity of Brazil’s economy
as relatively good, and sees a negative trend.
9
8
7
6
5
4
3
2
1
20
12
20
10
20
08
20
06
20
04
20
02
20
00
19
98
19
96
19
94
19
92
19
90
0
Energy intensity
CCPI evaluation of energy intensity of GDP
Level
Average energy intensity
in G20
Weak trend
Source: CCPI, 2016
very poor
poor
medium
good
Strong trend
very good
Carbon intensity of the energy sector
70
Compared to the G20 average, Brazil's carbon intensity of
total primary energy supply (CO2/TPES) is relatively low.
While it has been rising since 2009, it is expected to
remain relatively constant in the future. In 2013, CO2
emissions per TPES were at a level of about 37 tCO2 per TJ,
considered relatively good in the CCPI rating. Due to the
increase within the last five years, the CCPI recognises a
negative trend.
Tonnes of CO2 per TPES(tCO2/TJ)
60
50
40
Max
Min
30
20
10
Carbon intensity
(past trend)
Average carbon intensity
in G20
Carbon intensity
(current policy projection)
Global benchmark
for a 2°C pathway
30
20
26
20
22
20
18
20
14
20
10
20
06
20
02
20
98
19
94
19
19
90
0
CCPI evaluation of carbon intensity of energy sector
Level
Weak trend
Sources: Past: CCPI; future projections: CAT
very poor
poor
medium
good
Strong trend
very good
40%
700000
35%
600000
30%
500000
25%
400000
20%
300000
15%
200000
10%
Total coal in TPES [TJ]
Share of coal Total Primary Energy Supply (TPES)
The share of coal in Brazil’s total primary
energy supply is relatively low. Since 1990 it
has varied between 5% and 8%. For future
predictions, it is expected that the share will
remain on a level of around 6% until 2030.
100000
5%
0
% of coal (past trend)
% of coal (current policy
projections)
Average % of coal in G20
Global benchmark for a 2°C
pathway (min & max)
30
20
26
20
22
20
20
18
14
20
10
20
06
20
20
02
98
19
94
19
19
90
0
Evaluation of coal share in TPES
Total coal consumption (TJ)
poor
medium
good
Source: CAT
Source: own evaluation
Brown to green: G20 transition to a low carbon economy
Brazil - Country Profile
120%
6000000
100%
5000000
80%
4000000
60%
300-000
40%
2000000
20%
1000000
0
Total renewable energy in TPES [TJ]
Renewable energy in TPES and electricity sector
Brazil's share of renewable energy in electricity
slightly decreased over the last decade. However,
it remains at a very high level with a share of 82%
in 2012. According to future projections, the share
will slightly increase in the coming years. Due to its
large-scale hydro power generation, nearly 40% of
its primary energy supply comes from renewable
sources, the highest share in the G20 countries. It
must be noted that large hydro-power plants raise
other environmental and social concerns. The CCPI
assessment ranks Brazil as relatively good. Further
growth in the renewables sector over the past five
years contributes to a positive trend.
% of renewable energy
in electricity (past trend)
% of renewable energy
in TPES (past trend)
% of renewable energy
in electricity
(current policy projections)
G20 average % of
renewable energy in TPES
Total renewable energy
consumption (TJ)
20
30
20
26
20
22
20
18
20
14
20
10
20
06
20
02
19
98
19
94
19
90
0
CCPI evaluation of renewable share in TPES
Level
Sources: CCPI and CAT
Weak trend
very poor
poor
medium
good
Strong trend
very good
Brazil’s electricity demand per capita continuously increased
over recent years, but remains relatively low compared to
other G20 countries. It is expected that it will further increase
until 2030.
Brazil’s electricity emissions intensity has increased, and today
is around 98 gCO2 per kWh. This relatively low intensity level
results from the large hydropower sector and its relatively
well-developed renewable energy sector. Future projections
show electricity emissions intensity will remain relatively
stable.
Electricity demand per capita
(past trend)
Average electricity demand
per capita in G20
Electricity demand per capita
(current policy projections)
30
20
26
20
22
20
18
20
14
Good practice benchmark:
without nuclear or large
hydro potential (Denmark)
Emissions intensity
(past trend)
Average emissions intensity in G20
Good practice benchmark:
with large hydro potential (Norway)
Emissions intensity
(current policy projections)
Source: CAT, 2015
20
20
10
0
06
30
20
26
20
22
20
18
20
14
20
10
20
06
20
02
20
98
19
94
19
19
90
0
100
20
500
200
02
1000
300
20
1500
98
2000
400
19
2500
500
94
3000
600
19
3500
90
4000
19
Emissions intensity of electricity [gCO2/kWh]
Emissions intensity of the electricity sector
Electricity demand per capita [kWh/cap]
Electricity demand per capita
Source: CAT, 2015
Evaluation of the electricity
emission intensity
poor
medium
good
Source: own evaluation
Brown to green: G20 transition to a low carbon economy
Brazil - Country Profile
CLIMATE POLICY PERFORMANCE
Climate policy evaluation by experts
Checklist of the climate policy framework
On national policy, experts highlighted Brazil’s weak
governance and poor appreciation for economic
opportunities in low carbon development. On
international policy, experts acknowledged the
efforts in pushing negotiations, but criticised the
poor mitigation ambition and willingness to
compromise. Overall, the CCPI rates Brazil’s climate
policy as medium.
Low emissions development plan for 2050*
2050 GHG emissions target
Building codes, standards and incentives for low-emissions options
Support scheme for renewables in the power sector
Emissions performance standards for cars
Emissions Trading Scheme (ETS)
The CCPI evaluates a country‘s performance in national and
international climate policy through feedback from national energy
and climate experts.
Carbon tax
very good
* understood as decarbonisation plans and not specifically as the plans called for in
the Paris Agreement
good
Source: Climate Policy Database, 2016
medium
poor
CCPI evaluation of climate policy
6
5
01
I2
CC
P
4
01
I2
CC
P
3
01
I2
CC
P
2
01
I2
CC
P
1
01
I2
CC
P
0
01
I2
CC
P
9
01
00
I2
very good
CC
P
good
I2
medium
I2
poor
CC
P
very poor
CC
P
00
8
very poor
CCPI edition
National
International
Source: CCPI, 2016
Compatibility of national climate targets (INDCs) with a 2°C scenario
Total emissions (MtCO2e/a)
2500
2000
1500
1000
Max
500
Min
Historic emissions
(excluding forestry)
Historic forestry emissions/removals
sufficient
30
20
26
20
22
20
Emissions in INDC scenario (max & min)
CAT evaluation of Brazil’s Intended National
Determinded Contributions (INDC)
medium
18
Fair emissions reduction range
in a 2°C pathway
Current policy emissions
projections (excluding forestry)
inadequate
20
14
20
10
20
06
20
02
20
98
19
94
19
19
90
0
Brazil submitted its Intended Nationally
Determined Contribution (INDC) on 28 September
2015. Its target is to reduce net GHG emissions by
37% below 2005 levels by 2025, after accounting for
the Land Use, Land Use Change and Forestry
(LULUCF) sector. The INDC also has an “indicative
contribution” to reduce emissions by 43% below
2005 levels by 2030, including LULUCF. It outlined
steps to help meet the targets, including a share of
45% renewables in the total energy mix by 2030.
After excluding LULUCF, the Climate Action Tracker
estimates the INDC will result in an increase in
emissions of about 36% above 2005 levels by 2025.
Based on this target, it rates Brazil “medium,”
meaning it is inconsistent with limiting warming to
below 2°C - unless other countries make much
deeper reductions and comparably greater effort.
According to the CAT’s assessment, Brazil is very
close to meeting its INDC targets under current
policies. For example, the 45% renewable energy
target represents a very small improvement relative
to baseline projections. Currently implemented
policies lead to about 41% of renewables in Brazil’s
energy mix by 2030, close to today’s level of 41.3%.
role model
Source: CAT, 2015
Brown to green: G20 transition to a low carbon economy
Brazil - Country Profile
FINANCING THE TRANSITION
Investment attractiveness
Allianz Energy and
Climate Monitor
RECAI* (E&Y index)
Category (own assessment)
Climate Transparency rates Brazil’s investment attractiveness as low to
medium, due to weak long-term renewables targets, inadequate
(financial) support policies for renewable energy development and
unambitious past political action. While strongly relying on hydropower,
Brazil has a low market absorption capacity for other renewables, despite
a recent plan to increase non-hydro renewable capacity by 12GW by
2018.
LOW
MEDIUM
Sources: Allianz Energy and Climate Monitor and RECAI reports
Trend**
*Adapted from RECAI and re-classified in 3 categories
(low, medium, high) for comparison purposes with Allianz Monitor.
**Taken from RECAI issue of May 2016
The Allianz Energy & Climate Monitor ranks G20 member states on their relative fitness
as potential investment destinations for building low-carbon electricity infrastructure.
The investment attractiveness of a country is assessed through four categories: Policy
adequacy, Policy reliability of sustained support, Market absorption capacity and the
National investment conditions. The Renewable Energy Country Attractiveness Index
(RECAI) produces score and rankings for countries’ attractiveness based on Macro
drivers, Energy market drivers and Technology-specific drivers which together
compress a set of 5 drivers, 16 parameters and over 50 datasets.
Historical investments in renewable energy and investment gap
This section shows Brazil’s current investments in the overall power sector (including distribution and transmission) as well as in
renewable energy expressed as the share of the total annual investments needed to be in line with a 2°C compatible trajectory.
Investments
in the power sector
% of current investments
in the power sector
compared to
the investment needs
under a 2°C pathway
57%
Investments in renewable energy
for the power sector
62%
% of current investments
for renewable energy
in the power sector
compared to
the investment needs
under a 2°C pathway
Source: Adapted from WEIO, 2014(1)
WEIO (2014) compares annual average investments from 2000 to 2013 with average annual investments needed from 2015 to 2030 under a 2°C scenario
(1)
Carbon pricing mechanisms
Emissions Trading Schemes (ETS)
An ETS caps the total level of GHG emissions and
allows industries to trade allowances based on
their marginal abatement cost. By creating a
supply and demand for allowances, an ETS
establishes a market price for GHG emissions.
Although Brazil has no carbon pricing system yet in place, the
government is currently exploring possibilities of using a national
Emissions Trading Scheme to more cost-effectively meet its
voluntary greenhouse gas reduction commitment.
At the subnational level, Rio de Janeiro and Sao Paulo are
considering implementing ETS schemes to curb emissions from
energy-intensive sectors. However, political opposition has
significantly delayed and further postponed their implementation.
Carbon Tax
A Carbon tax directly sets a price on carbon by
defining a tax rate on GHG emissions or – more
commonly – on the carbon content of fossil
fuels. Unlike an ETS, a carbon tax is a price-based
instrument that pre-defines the carbon price,
but not the emissions reduction outcome of a
carbon tax.
GHG
Sources: World Bank and Ecofys, 2016; other national sources
Brown to green: G20 transition to a low carbon economy
Brazil - Country Profile
Fossil fuel subsidies
Petrobras, where the government holds the controlling interest, is Brazil’s largest oil and gas producer, producing over 5 times the
combined of all Brazil’s 34 private oil and gas companies. The government offers a range of tax and budgetary subsidies for fossil fuel
production, including preferential loans for oil and gas producers through Petrobras and the Brazilian Development Banks (BNDES).
OECD data indicates a sharp decline in government direct spending on the extraction of petrol and natural gas in 2014. Paying the fuel
costs for national coal power plants - a temporary mechanism resulting from the transition in regulatory models in the power industry is expected to end in 2027.
Average annual
national subsidies (2013-14)*
Brazil
G20 total
% of government’s income
from oil and gas production (2013)*
$4.9 billion
3.7%
$70 billion
Source: ODI, 2015
*The indicators above refer only to subsidies for fossil fuel production, and include direct spending (e.g. government budget expenditure on infrastructure that
specifically benefits fossil fuels), tax expenditure (e.g. tax deductions for investment in drilling and mining equipment) and other support mechanisms (e.g.
capacity mechanisms).
Public climate finance
Brazil is not listed in Annex II of the UNFCCC, and it is therefore not formally obliged to provide climate finance. While climate-related
spending by multilateral development banks may exist, it has not been included in this report.
Brown to green: G20 transition to a low carbon economy
Brazil - Country Profile