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The energy minister of Brazil stated that there is no contradiction between the country’s plans to increase oil and gas exploration, including in the Amazon rainforest area, and its ambition to lead the global transition to green energy.
Brazil currently generates nearly 90% of its electricity from renewable sources and has a significant biofuels program. According to Alexandre Silveira, the country has the political, economic, and moral authority to discuss a just and inclusive energy transition with wealthy nations.
President Luiz Inácio Lula da Silva has been praised internationally for taking swift action to combat deforestation in the Amazon by 2030, reversing the alarming destruction seen under previous President Jair Bolsonaro.
However, while Lula was addressing the UN General Assembly about the climate crisis, Silveira argued in favor of oil exploration in the ecologically sensitive area where the Amazon river meets the Atlantic.
Brazil’s environmental regulator rejected a request by state-controlled oil company Petrobras to conduct drilling in the Equatorial Margin offshore zone, spanning across six impoverished Amazonian states. Petrobras has appealed against this decision.
Silveira defended the right of the Brazilian people to explore their mineral wealth, both onshore and offshore, stating that a portion of Brazil’s oil revenue funds healthcare, education, and the energy transition.
© Evaristo Sa/AFP/Getty Images
Brazil is expected to become the world’s sixth largest oil producer by 2030 if its current projects are realized. Opening up the coastal area off the Amazon could provide access to reserves containing up to 30 billion barrels of oil equivalent, making Brazil the fourth largest oil producer globally.
Silveira stated that he sees no contradiction between oil and gas exploration and the objective of a just and inclusive energy transition. He emphasized that the world still relies on fossil fuels and strict rules would be followed to prevent environmental damage in any drilling conducted in the region.
Brazil is advocating for a fair climate transition that considers the needs of all members of society. Silveira is engaging with the US, China, and European powers to communicate this message. He believes that social inclusion is crucial for achieving peace and that poverty and hunger must be addressed.
A recent study by the Boston Consulting Group highlighted Brazil’s potential for green hydrogen production due to its high proportion of renewable power and interconnected grid. However, the study also noted the need for tax and investment incentives to compete with other countries.
According to Silveira, Brazil’s renewable energy proportion is significantly higher than the global average, which stands at 28%.
The minister acknowledged the difficulty of providing large government subsidies for green hydrogen due to competing priorities in healthcare, education, and public security. Nevertheless, the government is committed to finding legal and regulatory incentives to support the nascent industry and may consider tax benefits for decarbonization efforts.
Brazil is also investing in biofuels, particularly bioethanol derived from sugarcane, which utilizes waste products to increase efficiency and reduce emissions. Biofuels already contribute to the country’s transportation sector and have potential applications in aviation fuel.
Silveira expressed concerns about protectionism by wealthy nations, believing that such barriers hinder social inclusion in the transition to clean energy.
“The barriers imposed by developed countries on the global south will not solve the energy transition problem,” he said.
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