A new hope for net-zero? Insights from the new Brazilian Carbon Market framework

Brazil has approved a carbon market, known as the Sistema Brasileiro de Comércio de Emissões (SBCE), marking a major milestone in the country’s climate policy. The SBCE will establish sectoral emission caps and create a regulated trading system where companies that emit below their limits can sell surplus credits, while those that exceed their quotas must purchase allowances to comply with regulations. With this initiative, Brazil aims to incentivize emission reductions, maximize environmental benefits, and create financial opportunities, aligning its economy with global decarbonization trends.

Although the agriculture sector was excluded, the SBCE still covers 53% of Brazil’s emissions. The power sector, responsible for only 4% of current emissions, may seem marginal at first glance. However, as electrification emerges as a key driver of the energy transition, understanding how carbon pricing affects electricity markets is crucial. Carbon costs will likely spread across industries, affecting investments and shaping market trends.

In our upcoming webinar, we will explore the implications of Brazil’s regulated carbon market and discuss:

• How does Brazil’s carbon market compare to existing schemes worldwide?
• What are the implementation phases of the SBCE, and when will its impact be felt?
• How might carbon pricing affect power market dynamics, PLD volatility, and the profitability of future renewable investments?

If you have any questions about this webinar or our Brazilian service, please reach out to Maria Quissini, our Commercial Associate.

Registration instructions: Please use a company email address, personal domains incl. Gmail/Hotmail will be rejected. Note that email addresses must be registered to a Zoom account. If you have not joined an Aurora webinar before, check that your organisation’s firewall permits access to Zoom.