Brazil needs to rapidly scale up its decarbonization efforts to become a net-zero economy by 2050, according to the New Energy Outlook: Brazil report released by BNEF (BloombergNEF). The analysis is based on the results of the New Energy Outlook 2024 and assesses the country's decarbonization trajectory until 2050, using bottom-up models in the electricity, transport, industry and buildings sectors.
The report uses BNEF’s latest energy and climate scenarios to analyze energy-related emissions, which account for half of the country’s total emissions. Agriculture, excluding land-use change and forestry, accounts for the other half. In Brazil’s energy sector, transportation accounts for 53% of emissions, followed by industry (25%), electricity and power (11%) and buildings (6%).
According to BNEF's Net-Zero Scenario (NZS), which maps a path to net zero carbon emissions worldwide by 2050, Brazil will need to invest US$6 trillion over the next 25 years to achieve this goal.
This is 8% more than the investment required under BNEF’s Economic Transition Scenario (ETS), which describes how the energy sector will evolve following cost-based technological change and without considering changes to current policies. Two-thirds of the investment in the NZS is for energy demand, particularly electric vehicle sales.
The country’s net zero future requires different technologies, with electrification being the main driver in the country’s efforts towards decarbonization. From 2040 onwards, electrification will become the main driver of emissions reduction, mainly through the decarbonization of the industrial, road transport and consumption sectors in buildings.
Electrification alone will account for 55% of emissions reductions from today to 2050, relative to a “no transition” scenario in which decarbonization and energy efficiency remained stagnant.
Other key technologies such as carbon capture and storage (CCS), green hydrogen and bioenergy will combined account for 27% of emissions reductions, mainly in end-use sectors. By 2050, the transport sector will account for more than half of hydrogen demand.
Shipping and aviation together will meet demand for 2,3 million metric tons of hydrogen, with the fastest growing category being hydrogen used in the production of sustainable aviation biofuels (SAFs).
Despite Brazil’s progress in decarbonizing electricity generation, clean energy will still account for 38% of emissions reductions by 2050 under the ETS. Prioritizing the implementation of mature technologies, such as wind and solar power, remains an economically advantageous option in the short term.
According to Vinicius Nunes, the report’s main author, “Brazil has a combination of renewable energy sources that positions the country favorably towards decarbonizing the economy through electrification.”
“However, half of the final energy use still comes from fossil fuels. The “hard-to-slaughter” sectors, such as aviation and steel, require diversified solutions and, therefore, there will be no net zero in Brazil without bioenergy, green hydrogen and carbon capture,” he said.
Other conclusions of the report
- Hydrogen demand in Brazil will increase fivefold, reaching 8,3 million metric tons by 2050, according to the Net-Zero Scenario;
- “Hard-to-slaughter” sectors, such as steel, aluminum, cement and chemicals, will face difficulties in the decarbonization process if there are no changes in current policies;
- A net-metering law has encouraged the development of small-scale solar power in Brazil. In the reference scenario, installed solar power capacity will reach 2050 GW by 200.
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