Brazil

Since early 2000, Brazil has employed significant political effort to adopt climate change legislation and policies. A 2007 Decree established the governance structure that developed the National Plan on Climate Change (Climate Plan). The Climate Plan provides a comprehensive framework of 25 actions to combat climate change. The framework primarily focuses on reducing deforestation. Additionally, the plan includes provisions on energy efficiency and renewable energy. It called for adding 7,000 MW of renewable energy from bagasse cogeneration, mini-hydro, and wind; increase bagasse cogeneration to 136TWh (11.4% of energy mix); add 34,460MWh from hydro; and use solar water heating to reduce energy needs by 2,200GWh/year. In the transport sector, it requires an increase in the share of rail and water transport; improve mass transit, bicycling, and river cargo. In the waste sector, the Plan calls for recovery of methane from landfills and an increase in urban solid waste recycling by 20% by 2015. The Climate Plan is currently being updated after the consultation process ended in December 2014.

The National Policy on Climate Change passed in 2009, establishing the country’s voluntary emission reduction target of 36.1% to 38.9% compared to business as usual by 2020 with 2005 as a baseline. The policy presents emission reduction targets for four designated strategic areas: deforestation (24.7%), agriculture and livestock (4.9% to 6.1%), energy (6.1% to 7.7%) and the steel sector (0.3% to 0.4%). The policy leaves specific implementation measures to be established either by decree or determined by the Second Brazilian Inventory on GHG Emissions and Reductions. It also incorporates all laws, measures and policies pertaining to climate change.

Other relevant climate legislation was approved in the context of the UNFCCC’s Conferences of the Parties. In 2010, the President passed a Decree establishing a nationwide target for annual GHG emissions of 2.1bn tons of CO2e by 2020, as compared to the current 2020 projection of 3.2bn tons CO2e. This Decree made Brazil the first developing country to institute an absolute limit to its GHG emissions. In addition to regulating features of the National Policy, such as the commitment to reduce deforestation rates by 80% in the Amazon Basin, by 40% in the cerrado (the savannah brushland that covers much of central Brazil), and to restore 35m ha of degraded land. The Decree also requires the elaboration of sectoral plans outlining mitigation actions for key economic sectors, with targets to be revised on a tri-annual basis.

Currently there are eight sectoral plans, in different phases of implementation: the Action Plan to Prevent and Control Deforestation in the Amazon (PPCDAm); the Action Plan to Prevent and Control Deforestation and Fire in the Cerrado (PPCerrado); the Low-Carbon Agriculture Plan (ABC Plan); the Ten-Year National Energy Expansion Plan (PDE); the Plan for Climate Change Mitigation for the Consolidation of a Low-Carbon Economy in the Manufacturing Industry; the Low-Carbon Mining Plan (PMBC); the Plan on Transportation and Urban Mobility for Climate Change Mitigation; and the Health Mitigation and Adaptation Plan. The mining, industry, agriculture and health plans are new plans especially prepared in attention to the climate legislation, while the other four plans pre-existed the National Policy on Climate Change and were taken as sectoral plans.

In terms of institutional arrangements, an Inter-ministerial Committee on Climate Change guides the development, implementation, monitoring and evaluation of the Climate Plan. It was established in 2007 to elaborate a preliminary proposal for the general objectives, principles and means of implementation of the National Policy on Climate Change, as well as the preliminary version of the National Plan on Climate Change. Co-ordinated by the President’s Chief of Staff, it includes representatives from 14 Ministries, the Secretariat of Strategic Affairs of the Presidency of the Republic and the Brazilian Forum on Climate Change, as a guest. Under the Inter-ministerial Committee there is an Executive Group on Climate Change, co-ordinated by the Ministry of Environment, which is responsible for developing, implementing, monitoring and evaluating the Climate Plan. There is an Inter-ministerial Commission on Global Climate Change, chaired by the Ministry of Science, Technology and Innovation, which pre-exists the climate legislation, and which articulates the government actions under the UNFCCC.

The Brazilian Research Network on Global Climate Change (Rede CLIMA), established in 2007 by the Ministry of Science, Technology and Innovation, generates and disseminates knowledge about the causes and effects of global climate change, by producing information for the formulation and follow up on implementation of public policies on climate change and by providing subsidies to Brazilian Delegations to meetings under the UNFCCC. The Brazilian Forum on Climate Change (FBMC), presided over by the President, has as its main purpose the promotion of spaces of discussion on climate change with broader segments of the society.

Sub-national level

Sub-national governments play an important role in establishing and implementing climate policies. In the past decade climate legislation has been approved in several states (for instance, São Paulo, Minas Gerais and Rio de Janeiro) and municipal districts (such as São Paulo, Rio de Janeiro and Curitiba). The first state law was created by Amazonas, which also established a dedicated body to deal with climate change issues (phased out due to budget constraints). The state of São Paulo approved a 20% emissions reduction target by 2020, considering 2005 as the base year. The cities of São Paulo and Rio de Janeiro have also assumed reduction targets. The city of São Paulo has pledged a 30% reduction, based on emissions from 2005 to 2010, and Rio de Janeiro has pledged 8% by 2012, 16% by 2016 and 20% by 2020.

Carbon Pricing

The creation of a cap-and-trade system has been foreseen since the 2008 National Plan on Climate Change. At present, discussions on the implementation of a cap-and-trade system are most developed at the subnational level. In the State of Sao Paulo, the Brazilian Emissions Reductions Market, was launched in 2004 as a joint initiative between the Ministry of Development, Industry and Foreign Trade and the Brazilian Futures Stock Exchange, to support the negotiation of carbon credits emanating from national Clean Development Mechanism (CDM) projects. Parliamentarians have put forward a series of draft laws on carbon market development, including provisions on trading over-the-counter and through stock exchanges, for both spot and futures transactions, authorised by the Brazilian Securities and Exchange Commission (CVM); the establishment of CDM Investment Funds to be structured by the CVM and the Commission on Climate Change; and multiple fiscal incentives to commercialise CERs emanating from CDM projects.

In November 2014, Brazil had 330 projects registered by the CDM Executive Board, equivalent to 4.4% of the global total, occupying the 3^rd position in number of projects registered. As for the reduction of GHG emissions projected through the CDM, the Brazilian potential of registered projects until November 2014 was about 370m tons of CO2e. It means that Brazilian CDM projects registered with the UNFCCC contribute to an average reduction of GHG emissions of approximately 48m tons of CO2e per year.

Adopted in 2011, the Green Allowance establishes payments for an ecosystem services scheme aimed at combating extreme poverty while incentivising conservation. Through the Green Allowance, payments of up to BRL 300 (USD116) will be transferred quarterly for a maximum period of two years to families living in extreme poverty to develop conservation activities. The passing of a law on payments for ecosystem services reflects an emerging consensus on a new development model that seeks to align economic growth with conservation through the promotion of sustainable production, infrastructure development, environmental protection and social inclusion.

REDD+ and LULUCF

A great part of Brazil’s commitment to climate change involves measures to tackle deforestation, since 61% of the country’s GHG emissions derive from the forest sector. Alongside provisions established by the National Policy and the National Plan on Climate Change, Brazil’s commitment to its Copenhagen pledges is further illustrated by the national REDD+ draft law, which was initially proposed in 2009. Following the elections in 2010, a more comprehensive REDD+ draft law was introduced to both the Lower House and to the Senate. The proposed legislation covers ownership of tradable REDD+ credits, creating a dedicated dispute settlement procedure for activities in this area. It establishes participatory rights and benefit-sharing rules to protect the rights of indigenous peoples, traditional communities and small rural producers. It establishes multiple sources of funding for the National REDD+ System, the regularisation of the Brazilian Emission Reductions Market, the adoption of an international agreement that sanctions the use of REDD+ credits as a compensation mechanism between countries and a national compensation mechanism. The Bill acknowledges the importance of both national and sub-national levels of governance, including private actors, to the implementa­tion of REDD+.

Parallel to these developments, since 2010 the Ministry of the Environment co-ordinated the debate about development of Brazil’s National REDD+ Strategy. A draft text of the National REDD+ Strategy was prepared by the Inter-ministerial Working Group on REDD+, with the participation of around 120 representatives from the aforementioned stakeholder groups, and delivered to the Executive Group of the Inter-ministerial Committee on Climate Change in 2013. However, similar to what has happened in the Legislature, the National REDD+ Strategy has not been made public nor turned into concrete action since then. Nevertheless, in the meantime regional governments have been successfully forging local plans on REDD+.

The 2010-2020 Low Carbon Agriculture Programme adopts measures to expand sustainable practices, expand commercial forests, and decrease deforestation by promoting agricultural and forestry activities (especially in the Amazon). One of the main aims of the programme is to contribute to soil recovery by incorporating a further 4m ha of land into an integrated system that will help farmers alternate their activities between forest, crops and pasture, adopting measures to better address vegetable residue use, and extending the use of environmentally-friendly fertilisers.

Energy Supply

Brazil boasts one of the most renewable energy mixes in the world, with over 41% of its supply coming from sources such as water resources, biomass and ethanol, in addition to wind and solar energy. Hydroelectric power plants are responsible for over 79% of the electricity generated.

Renewable energy is a key driver of new climate change-related legislation, reflected in Brazil’s prominent role in the development of biofuels and the promotion of hydropower. Hydropower is the main element in the country’s clean energy matrix. The National Plan on Climate Change determines that Brazil generate more than 80% of its power from renewable energy sources through to 2030, and establishes a series of renewable energy and biofuels requirements. The plan brings forward the 5% biodiesel blending requirement, and promotes solar and wind energy. The Federal Programme of Incentives for Alternative Electricity Sources (PROINFA) estab­lishes comprehensive renewable measures that seek to increase electricity generation from non-hydropower renewable energy sources.

Energy Demand

At 1.2toe, Brazil’s per capita consumption is 31% lower than the world average of 1.8 toe. Total energy consumption increased at the rapid pace of 3 % per year between 1990 and 2008. In 2009 it decreased as a consequence of the global economic crisis. Final consumption followed the same trend as total energy consumption. Oil is the main source of energy, accounting for 40% of the country’s overall consumption. Non-commercial energy sources (wood, bagasse) come second with 32%, followed by hydroelectricity (14%), gas (7%), coal (5%) and nuclear power (3%). Industry plays an important role in final energy consumption (46%, including non-energy uses). The transport sector absorbs one-third of final consumption and is a large consumer of biomass (alcohol consumption accounts for 20% of transport consumption). The households, services and agriculture sector accounts for just 22% of final energy consumption.

The National Electricity Conservation Programme (Procel) has been operating since 1985. It is co-ordinated by the Ministry of Mines and Energy, and promotes actions in sectors including buildings, appliances, and industry. Other more recent policies promoting energy efficiency include the National Energy Plan 2030 (PNE 2030), released by the Ministry of Mines and Energy in 2007, which foresees that by 2030 Brazil will have reduced energy consumption by 10%. The Ministry of Mines and Energy is currently working on the next National Energy Plan (PNE 2050), which should be finalised in 2015.The National Climate Change Plan (PNMC) seeks to increase energy efficiency across various sectors in line with best practices, and reduce electricity consumption in around 10% by 2030 compared with a reference scenario (equivalent to savings of 106TWh), which would avoid 30m tons of CO2 emissions by 2030. The plan also involves the replacement of 1m old refrigerators per year for 10 years. The plan aims to improve energy efficiency in industry, transport and buildings.

Although not a law, the most comprehensive policy dealing with energy efficiency is the National Energy Efficiency Plan, adopted in 2011. This Plan focuses on improving the sustainability of the energy sector, including more renewable energy into the national grid, reducing grid losses, and improving energy efficiency criteria. The implementation of the Plan shall provide energy savings of 106TWh in the next two decades, equivalent to what the residential sector consumes in one year. ANEEL, the Brazilian Electricity Regulatory Agency issued a set of regulations specifying the criteria for state electricity providers to follow when investing in energy efficiency projects.

Transportation

The transport sector is the dominant end-user of fuels and oil products. At present, the share of road transport in national transport is high: 52% of freight and 95% of passenger transport. Given the scarcity of rail networks, economic growth-induced increases in goods traffic have been on the roads, increasing the demand for diesel. In 2012, road transport accounted for 90% of GHG emissions from the transport sector. Trucks using diesel fuel generated 40% of transport-related emissions and passenger cars 30%, mostly from gasoline. A unique characteristic of Brazil’s transport sector energy mix is the high share represented by biofuels. Brazil is the world’s top exporter and consumer of sugarcane fuel ethanol. However, in recent years the sector has encountered a number of difficulties, which have impacted both production and export levels.

The National Plan for Logistics and Transport (PNLT), developed by the Ministry of Transport with the Ministry of Defence and first launched in 2007, is a long-term planning document that is updated periodically. It includes a broad investment programme that aims at a shift from road towards rail and waterway freight transport. The latest edition, from 2012, determines that, based on higher logistical costs and GHG emissions of freight transport via roads, a more balanced mix of transport modes is necessary. It expects the share of rail transport to increase to 43% (from the current 30%) and waterway transport to 15% (from 13% now). In addition, the current economy-wide planning document (PPA 2012-2015), in line with the National Energy Efficiency Plan, includes a target to conserve 20TWh of electricity (compared to a trajectory without efficiency measures) through the use of more energy efficient equipment over the period. The plan also mentions increasing production of biodiesel in accordance with the national biodiesel programme.

New sectoral mitigation and adaptation plans have been elaborated for transport and urban mobility. The 2013 Transport and Urban Mobility Plan focuses on the expansion of transport infrastructure and increased use of energy-efficient modes of transport. Improvements in public transport are expected to result in a 2.7% reduction in sectoral emissions. A freight transport plan promotes actions leading to a 3% reduction compared to business-as-usual emissions, principally from a switch to rail and waterways from road.

Adaptation

The 2008 National Plan on Climate Change identified a number of adaptation interventions and potential synergies with existing programmes to combat desertification and to promote the management of watershed resources. These interventions aim to improve regional modelling of climate change impacts, promote vulnerability mapping, prepare the country for health implications of climate change, and identify the most vulnerable groups in the country. These goals fall along two general themes – increasing institutional, managerial, and legislative capacity for adaptation and promoting direct action steps for addressing impacts, risks, and particular vulnerabilities. The 2009 National Policy on Climate Change further identified specific sectors and locations in need of adaptation and proposed both short- and long-term strategies. It also established the National Climate Change Fund (FNMC) to provide financial support to climate change mitigation as well as adaptation.

Yet Brazil still lacks of a national strategy for vulnerability assessments and adaptation measures to cope with climate change. In 2011 the President created the National Plan on Disaster Risk and Response Plan, as a priority policy to deal with climate risks and extreme weather. Further to this the Centre for Disaster Monitoring and Alert (CEMADEN) was created within the National Institute on Space Research (INPE), which is linked to the Ministry of Science and Technology. The focus of CEMADEN is in monitoring and reducing the impacts of climate extremes. One of CEMADEN’s projects involves the installation of semi-automatic pluviometers to be managed by local citizens in nearly 800 communities throughout Brazil. Data will be collected to create online, open-data national monitoring maps.

In 2013 the Brazilian Climate Change Panel issued the first national assessment report on impacts, vulnerabilities and adaptation to climate change. The assessment identifies the vulnerabilities of the country in the face of global warming; evaluates the impacts in key sectors of the economy and society, according to the climate projections until the end of the century; and identifies studies on, and measures for, adaptation to climate change in place until 2012.

The Presidency of Brazil, through its Secretariat of Strategic Affairs, has been in charge of an ambitious study on adaptation, covering various sectors and using various climate change scenarios downscaled by INPE. The outcomes of this strategic study serve as the basis for an inter-ministerial Adaptation Working Group established in 2013 to prepare Brazil’s National Adaptation Plan.