Brazil is the seventh biggest consumer of energy in the world and the biggest in Latin America. The country is also a major producer of oil and natural gas and the second-biggest ethanol producer in the world. Given that, it is very significant to point out that Brazil’s energy policies measure up well against the world’s most urgent energy challenges. Access to electricity across the country is almost universal and renewables meet almost 45% of primary energy demand, making Brazil’s energy sector one of the least carbon-intensive in the world.
The government agencies responsible for energy policy are the Ministry of Mines and Energy (MME), the National Energy Policy Council (CNPE), the National Petroleum, Natural Gas and Biofuels Agency (ANP) and the National Energy Agency Electrical (ANEEL). The state-owned companies Petrobras and Eletrobras are the main players in the energy sector in Brazil, as well as elsewhere in Latin America.
Large hydropower plants account for around 80% of domestic electricity generation in Brazil, giving the electricity system a great deal of operational flexibility. Continued expansion of hydropower is increasingly constrained by the remoteness and environmental sensitivity of a large part of the remaining water resources, although 20 GW of hydropower capacity is currently under construction in the Amazon region. Reliance on other sources for power generation is growing, notably natural gas, wind, and bioenergy.
At the end of the 1990s and the beginning of the 2000s, Brazil’s energy sector underwent market liberalization. The government introduced privatization of some state-owned companies, market competition and the creation of regulatory agencies. However, the government still retained monopoly control of key energy complexes and regulated the price of certain energy products.
Brazil has the potential to generate even more electricity through renewable sources, especially through wind power plants and solar panels. A lack of infrastructure for both renewable energy generation and distribution makes the country not able to fully take advantage of this huge potential for energy reform. However, there have been very few signs from the Bolsonaro government that they are willing to invest in this type of infrastructure.
Moreover, large offshore oil and gas discoveries have confirmed Brazil’s status as one of the world’s foremost oil and gas provinces. The “pre-salt” discoveries also prompted a change in upstream regulation, granting Petrobras – the national oil company – a strengthened role in areas deemed strategic. However, the economic vulnerability of the company in light of corruption scandals in the last years threatens the effective exploration of those resources, which even brought up further discussions of privatization of the exploration of such oil. In addition, production from the deepwater pre-salt fields in the Santos basin has gained considerable momentum in recent years, offsetting declining output from mature fields elsewhere. Thanks to such successful developments in deepwater production, Brazil turned into a net oil exporter in 2017. According to IEA forecasts, Brazil’s net oil exports will pass the 1 million barrels/day mark by 2022.
Activity Rating: *** Right Direction
Although Brazil is a symbol of renewable energy use, the country is not using its full potential to make use of wind power plants and solar panels. More investments in generation and distribution of such renewable resources is needed.
Please send the following message to the policymaker(s) below.
Dear Minister Albuquerque,
We congratulate the government on so many great initiatives that pave the way towards greener energy usage in Brazil. However, much more needs to be done. Please take the steps needed to maximize Brazil’s use of renewable energy (especially in terms of infrastructure development and improving distribution capability).
Minister of Mines and Energy.
This Post was submitted by Climate Scorecard Country Manager Luiza Martins Karpavicius