# Greenhouse Gas Control Policies in Brazil

May 7, 2012, 1:33 pm
Source: Crs
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## Overall GHG emission target and timing

[1]In November 2009, Dilma Rousseff, chief of staff for Brazilian President Luiz Inácio Lula da Silva, was reported as saying that her country would take a proposal for voluntary GHG emissions reductions of 36-39% by 2020 to the Copenhagen summit.[2] Brazil’s emissions would drop to near 1994 levels if the top end of the pledge is met, representing about a 20% cut from the 2.1 million tons emitted in 2005. The emission cuts would be based largely on reducing deforestation rates, and would depend in large part on obtaining “sufficient” financing. President Lula stated in December 2008 that Brazil would slow its rate of deforestation in the state of Amazonas by 70% by 2017, compared to the average rate from 1996 to 2005. In September 2009, the Brazilian government extended this target to an 80% reduction by 2020.[3] Brazil has set a target by 2010 for zero deforestation in its Atlantic Forest.

## Principal Policy Instruments

In December 2008, Brazilian President Luiz Inácio Lula da Silva signed the National Climate Change Plan (PNMC) into effect.[4] Policy measures include:

• Stimulating energy efficiency through best practice, including the implementation of an energy efficiency policy that targets a savings of 106 terawatt hours per year (TWh/y) by 2030; the substitution of renewable charcoal for coal in manufacturing sectors; the replacement of one million old refrigerators per year for 10 years; the deployment of solar power systems for water heating; and the phasing out of the use of fire for the clearing and cutting of sugarcane.

• Retaining a high renewable energy share in the electricity sector, including the increase of the total electricity supply from cogeneration, mainly from sugarcane bagasse, to 11.4% by 2030; the reduction of non-technical losses in electricity distribution at a rate of 1,000 GWh/y over the next 10 years; the addition of 34,460 MW capacity from new hydropower plants over the next 10 years; the increase in electrical supply share from wind and sugarcane bagasse by 7,000 MW by 2010; and the expansion of the national solar photovoltaic industry and its deployment in systems isolated from the grid.

• Increasing the share of bio-fuels in transport matrix, including the attempt to encourage industry to achieve an annual substitution rate of 11% bio-fuels for fossil sources over the next 10 years; and the institution of a 5% bio-fuel to diesel mandate by 2010;

• Reducing deforestation rates and eliminating forest losses, increasing policing against illegal logging and curtailing financing to illegal ranching.

• Continuing the policy measures of prior renewable energy regulations including the 2004 Program of Incentives for Alternative Electricity Sources (PROFINA), coordinated by the Ministry of Mining and Energy and Centrais Elétricas Brasileiras (Eletrobras). The program contains new strategies for the incorporation of renewable resources in Brazil’s energy matrix and strengthens the country’s policy on diversification and development. On its inception, PROFINA contracted 144 generation stations to benefit 19 states with a combined capacity of 3,300 MW from wind, biomass, and small hydro sources for a potential GHG reduction of 2.8 Mt CO2/year.

Many of Brazil’s mitigation strategies involve the reduction of deforestation rates in the Amazon. The current administration has expanded protected areas in the Amazon and implemented new environmental policies. More than 62 natural reserves have been established in the Amazon, bringing the total area of the Brazilian Amazon protected by law to 280,000 square kilometers, the fourth-largest percentage of protected area in relation to territory among all countries. In addition to the aforementioned National Climate Change Plan, Brazil has enacted other laws that address deforestation and sustainable development.

• The Public Forest Management Law encourages sustainable development, places a moratorium on soybean plantings and cattle ranching in the Amazon, and authorizes the creation of a plan to reduce the rate of Amazon deforestation by half. Brazil plans to meet this goal by increasing federal patrols of forested areas, replanting 21,000 square miles of forest, and financing sustainable development projects in areas where the local economy depends on logging.

• The Action Plan for the Prevention and Control of Amazon Deforestation intends to improve the monitoring of the deforestation process, from a regional to a local scale; promotes the presence of public authorities in critical zones; confronts the economic speculation problem involved in public lands; plans the appropriate distribution of public lands according to social and ecological needs; and retains commercial wood exploration while also promoting sustainable forest management.

• The Amazon Fund (a private fund) aims to combat deforestation and to promote sustainable development in the Amazon. In 2008, Norway pledged $1 billion to the fund through 2015, making it the first country to do so, stating that it would donate as much as$130 million in 2009.[5]

The Brazilian government maintains that these efforts have been successful. It has recently been reported that deforestation of the Amazon fell by the largest amount in more than 20 years, dropping 45%, from nearly 5,000 square miles to some 2,700 square miles, in 2008, although there normally is a great deal of year-to-year variability in deforestation rates.[6] A continued emphasis on enforcement coincides with legislation. The enactment of the Prevention of the Use of Illegal Timber in the Building Industry Act, starting January 2009, asks for proof of the legal origin of timber from building companies. As such, the government recovered 1.4 million cubic meters of illegal wood and 700 people were put in prison.[7]

Observers note however that other factors contribute to the rate of deforestation beyond governmental policy measures. Brazilian deforestation is strongly correlated to the economic health of the country. Recent reductions are concurrent with the global economic downturn. Falling commodity prices have stalled the expansion of ranching and agriculture into the Amazon. While these trends have seemed favorable for emission reductions, some commentators still point to what they consider continued deforestation practices by commercial and speculative interests, misguided government policies, inappropriate World Bank projects, and commercial exploitation of forest resources. Others see favorable taxation policies, combined with government subsidized agriculture and colonization programs, as a continued encouragement for the destruction of the Amazon. Still others emphasize the inherent difficulty in measuring, reporting and verifying any GHG emission reductions in the Land Use, Land Use Change and Forestry (LULUCF) sector. Finally, most stress the crucial commitment to local law enforcement policies to sustain any regulatory reform that comes out of the federal government.

## Covered Gases and Sectors

Primarily CO2 in deforestation and other domestic agendas; however, U.N. Clean Development Mechanism projects in Brazil include CH4 and N2O reductions.

## Allocation of GHG reductions to various sectors

Unlike other developed or developing countries, Brazil holds a unique endowment of natural resources that affects its climate change portfolio in the power generation and transportation fuel sectors. A low contribution of greenhouse gas emissions has been due to both market-driven and governmental decisions to adopt renewable energy sources over the past few decades. The markets for both hydroelectricity and sugarcane products (bagasse for thermal purposes and ethanol for transportation fuel) have expanded 10-fold. During this period there was also an important decrease in wood consumption in the residential and industrial sectors and an increase in charcoal consumption in the industrial sector.

Taken together, however, the sectors of energy, industrial processes, solvents and waste treatment contribute only 25% of total GHG emissions, estimated at approximately 1 billion tons. The rest of Brazilian GHG emissions is tied to the LULUCF sector, and of that total, 90% corresponds to the conversion of forests to other uses, especially agriculture and ranching. For this reason, most of Brazil’s mitigation policies have concentrated on the forestry sector.

Not specified.

## References

1. ^ This section was prepared by Richard K. Lattanzio, Analyst in Environmental Policy, Congressional Research Service
2. ^ See http://www.reuters.com/article/marketsNews/idUSN1347815120091113.
3. ^ According to Brazil’s National Institute of Space Research (INPE), Brazil’s average rate of deforestation from 1996 to 2005 was 7,542 square miles annually, compared to averages of 6,574 annually from 1988 to 1995, and 4,974 from 2006 to 2008; http://www.mongabay.com/brazil.html. This target does not appear to include forests, including open canopy forests, in other parts of Brazil, which may be cleared for agricultural production. Also, http://en.cop15.dk/ news/view+news?newsid=2351, http://www.cmcc.it:8008/cmcc/blog-en/brazil-sets-new-deforestation-target.
4. ^ http://www.mma.gov.br/estruturas/208/_arquivos/national_plan_208.pdf.
5. ^ Brazil received \$100 million of the pledge on March 25, 2009. The remainder is pending. See http://inter.bndes.gov.br/english/news/not036_09.asp.
6. ^ See http://www.eenews.net/Greenwire/2009/11/13/4.
7. ^ http://www.redd-monitor.org/2009/01/23/brazils-national-plan-on-climate-change-and-the-amazon-fund- %E2%80%9Cthis-plan-does-not-create-any-carbon-credits-or-right-to-emissions%E2%80%9D/.

Note: The first version of this article was drawn from  R40936 An Overview of Greenhouse Gas (GHG) Control Policies in Various Countries by Jane A. Leggett, Richard K. Lattanzio, Carl Ek, and Larry Parker, Congressional Research Service, November 30, 2009.

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