Rio+20 and Brazil's Policy on Climate Change

Eduardo Fernandez Silva
Sunday, April 29, 2012

Originally published in Nature Climate Change 2: 379-380

As host to the Rio+20 United Nations Conference on Sustainable Development, Brazil will draw international attention to its policy on climate change, but the measures announced so far are not commensurate with the recently set reduction goal.

Brazil is the fourth biggest greenhouse-gas emitter in the world1. On the eve of the Copenhagen climate talks in December 2009, the National Policy on Climate Change Law2 was approved, marking a turnaround in the country's historic refusal to accept emissions-reduction goals. The law determined an emissions reduction, by 2020, between 36.1% and 38.9% of projected emissions if a fossil-fuel-intensive scenario prevailed. The baseline only became clear one year later: a decree3 defined the projected 2020 emissions under such a scenario to be 3.2 Gt of carbon dioxide equivalent (CO2e). Thus, in the midrange, Brazil's emissions should be reduced to 2 Gt CO2e, which is approximately the annual emissions level officially reported for 2005 (ref. 4).

The law2 requires a national plan to be drafted, with proposals on how to reach the goal; a presidential decree will turn the proposals into official measures. The launching of the plan, originally due in December 2011, has been postponed to April 2012 (ref. 5) — a date closer to the Rio+20 conference. Proposals covering eleven sectors, drafted with the cooperation of sector representatives, will be combined to create the national plan. So far, only five proposals have been made public: deforestation control in the Amazon and in the Cerrado, and emissions reductions in the steel industry, in energy generation and distribution, and in agriculture. These last three are commented on below. Proposals relative to transportation, building, cellulose and other industrial sectors are still awaited.

The law2 also mentions “fiscal and tax measures to be defined in a specific law” and “measures to be created”. However, these additional measures remain undefined and there is no public debate about them. The National Fund on Climate Change, created in December 2009, is another key instrument to reduce emissions from all sectors6.

Greenhouse-gas emissions from land use, land-use change and forestry (LULUCF) account for 55% of Brazil's total emissions as of 2005 — the latest estimate available1, 4. The main driver of these emissions has been deforestation, mainly in the Amazon. Owing to international and national pressures, since 2004 and mainly after 2007, the Brazilian government adopted clear and effective measures to tackle the problem: deforestation in critical municipalities was prohibited; illegally deforested areas were embargoed; environmental police activities were intensified; and credit concessions to farms not compliant with land tenure and environmental regulations were prohibited. As a result, annual deforestation in the Amazonian region decreased by 77% from 2004 to 2011 (ref. 7).

Excluding LULUCF, Brazil still ranks seventh among the world's biggest emitters1. It is, thus, important to analyze measures proposed to reduce non-LULUCF emissions.

Proposed measures to curb emissions

In 2010, Brazil produced 33 million tons of steel, plus 10 million tons of (mostly exported) pig iron8. The proposal for the steel sector9 covers only pig iron, which burns charcoal — approximately 50% from native forests10 — instead of coal and emits annually 10.5 Mt CO2e (ref. 9). The proposal aims to limit the sector's 2020 emissions at between 8 and 10 Mt CO2e, also annually, based on two instruments. One is increasing Brazil's stock of planted forests from 5.4 million to 7.4 million ha, thus reducing the pressure on native forests. For that, the estimated credit needed over ten years is US$6.9 billion, but no information is given about the source of funds. No analysis is presented, either, of the environmental and other impacts of the additional forested area. The second instrument is providing technical assistance to reduce inefficiency in the transformation of wood into charcoal. Practically all producers of charcoal from native forests in Brazil are very small, informal businesses, many of them illegal10. To reduce inefficiency, charcoal producers need to improve the technical processes that they use, as well as their quality of life. However, the proposal makes no reference to how technical assistance can transform such operations, to strategies to improve their living conditions or to offering them alternative economic opportunities. Finally, the proposed emissions reduction rests on the unlikely hypothesis that pig-iron production will remain constant, at 13 million tons per year, after 2014 (ref. 9).

Agriculture and livestock are responsible for one-quarter of Brazil's emissions11. To reduce emissions, six objectives have been defined3: restoring degraded pastures (15 million ha), additional agroforestry (4 million ha), expanding the direct planting system (8 million ha), introducing biological nitrogen fixation (5.5 million ha), treating animal manure (4.4 million m3) and new planted forests (3 million ha). No mention is made to a baseline against which to evaluate the efforts needed, or the progress obtained, and it is unclear whether the additional planted forest area includes, or not, that mentioned in the steel-industry proposals.

The same instruments are proposed to achieve all six objectives: technical assistance, advertising campaigns promoting the suggested production methods, (unspecified) research and development support and an estimated US$112.6 billion in credit, from 2011 to 2020. However, the actual amount of credit conceded for these purposes, in the 18 months beginning in July 2010, reached only US$0.24 billion (ref. 12).

As to the energy sector, dozens of vague suggestions are presented — the creation of a steering committee to monitor developments, a database of consumption indexes and energy performance baselines, changes in public procurement rules, the provision of fiscal incentives, and so on — but no concrete measures13. There are no indications on how to minimize the difficulties, acknowledged in the proposal, related to scaling-up energy efficiency projects owing to the reluctance of banks to finance them. The document explicitly recognizes the importance of economic incentives, but suggests none.

The National Climate Change Fund

None of the sources that feed the National Climate Change Fund are reliable. For example, it should receive “up to 60% of the funds, directed to the environment ministry, generated by the Special Participation in oil exploration”6. Had this source been fully available, the fund should have received US$670 million in 2011, but apportionments amounted to US$193 million, grants reached just US$14 million and no credit was conceded, as it was only in September that the monetary authority Conselho Monetário Nacional defined the fund's rules14, including an annual interest rate of 6.1% for loans to combat desertification and 9% for those to improve charcoal production. For 2012, the fund's apportionment totals only US$222 million, and actual disbursements are unpredictable, as happened in 2011 and frequently occurs with budget apportionments in Brazil.

The way forward

Clear and objective policy instruments promote results, as seen for reducing deforestation in the Amazon. No similarly clear instruments have been proposed to reduce emissions from non-LULUCF sources, suggesting that Brazil's proposed policy focuses on fending international pressures and improving the government's public image, rather than on tackling the problem. Further analysis of Brazilian policies, international and national debates, and other initiatives must be undertaken to convince the Brazilian public of the growing costs of continuing intensive use of fossil fuels, and of the increasing benefits of firmer, greener policies. Brazilian authorities should recognize this and stimulate a revision of the proposals to introduce economic incentives and sanctions strong enough to promote changes in current behaviour. Thus, the country's policies on climate change might be able to evolve and incorporate effective instruments. This could be one positive side result of the Rio+20 conference.


  1. World Resources Institute Climate Analysis Indicators Tool (2011).
  2. Lei no. 12.187 (2009)
  3. Decreto no. 7.390 (2010)
  4. Ministério da Ciência e Tecnologia Inventário Brasileiro das Emissões e Remoções Antrópicas de Gases de efeito Estufa (Ministério da Ciência e Tecnologia, 2009)
  5. Decreto no. 7.643 (2011)
  6. Lei no. 12.114 (2009)
  7. Barreto, P. & Araújo, E. O Brasil Atingirá sua Meta de Redução doDdesmatamento? (Imazon, 2012)
  9. Ministério do Meio Ambiente Plano Setorial de Redução de Emissões da Siderurgia: Sumário Executivo (Ministério do Meio Ambiente, 2011)
  10. Uhlig, A., Goldemberg, J. & Coelho, S. T. Rev. Bras. Energ. 14, 6785 (2008).
  11. Presidência da República Plano de Agricultura de Baixa Emissão de Carbono (Plano ABC) (Presidência da República, 2011)
  12. Ministério da Agricultura Pecuária e Abastecimento Estatísticas e Dados Básicos de Economia Agrícola (Ministério da Agricultura, 2012)
  13. Ministério de Minas e Energia Plano Nacional de Eficiência Energética: Premissas Ediretrizes Básicas (Ministério de Minas e Energia, 2011)
  14. Banco Central do Brasil. Resolução no. 4008 (2011)