Brazil will host the COP30 UN climate summit.

Later this year, Brazil will host the COP30 UN climate summit.
This week, NEF published a report that highlights the South American nation's climate goals and outlines how it may change its economy to reach net zero. The electric path to net zero in Brazil Written by Olivia Rudgard Brazil, which currently has one of the Group of 20's cleanest power sectors, will have to spend $6 trillion between now and 2050 to accelerate the decarbonization of the whole economy. According to NEF's most recent analysis, Brazil's energy-related emissions need to decrease by 14% by 2030.
With the country's climate ambitions in the spotlight, NEF released a report this week showing how the South American nation can transform its economy to achieve net zero. For unlimited access to climate and energy news

Brazil's electric road to net zero By Olivia Rudgard Brazil, which already boasts one of the cleanest power sectors in the Group of 20, will need to invest $6 trillion from now until 2050 to speed up decarbonization across its entire economy. This is the latest assessment from NEF, which finds that Brazil's energy-related emissions must fall 14% by 2030, compared with 2023 levels, and drop 70% a decade later to be on a path to net zero. In its New Energy Outlook report, BNEF says Brazil will need to put more money into abatement technologies like carbon capture and storage, but its biggest decarbonization challenge will be electrifying transportation, which currently represents more than half of the country's energy sector emissions. The analysis comes as Brazil prepares to host the annual United Nations climate conference, known as COP30, later this year. Countries at the summit will be asked to demonstrate their continued commitment to the landmark Paris Agreement, which pledges to keep global warming to well below 2C, and ideally 1.5C, relative to pre-industrial levels.

To meet its climate ambitions, Brazil will need to show it's tackling deforestation and agriculture emissions, along with addressing energy transition issues, according to BNEF. Still, the analysis of Brazil's power, transportation, industry and buildings sectors does not see a scenario where the country aligns with 1.5C. At best, Brazil will be consistent with 1.75C of warming by 2100 if it fully decarbonizes its economy by midcentury, the report said. This rises to 2.6C in a base case scenario, assuming there's no extra policy support for the transition, and economic development is based on the cheapest technology available.

Read some of our takeaways below: Solar and wind are the future Brazil has been a pioneer in hydroelectric power, installing more than 100 gigawatts of capacity since the 1960s. But that is unlikely to continue. Its mega dams have been beset by issues including environmental damage and downtime when river levels are low. Now it's the turn of wind and solar to pick up the mantle. Both are expected to rise significantly under a net-zero or base case scenario. Around 90% of Brazil's electricity generation in 2024 came from renewables. That sector is set to grow, largely because it's cheap to expand wind and solar. Both are expected to overtake the supply from hydroelectricity by 2050. "Brazil builds a lot of solar and builds a lot of wind, not only because it's concerned with net zero, but because it's cheaper than building gas," said Vinicius Nunes, a BNEF research associate and the report's author. "Gas is not cheap in Brazil, oil is not cheap in Brazil, but solar and wind are the cheapest source of electricity. So even if you're not aiming to net zero, economically-wise it makes sense to build renewables." Energy is half the battle While Brazil's power sector is almost entirely decarbonized, fossil fuels are still widely used in other sectors like transportation and industry. "Brazilians tend to think that because the power sector is already decarbonized, you don't have a lot of energy emissions.
But that's not the case at all," Nunes said Fossil fuels still account for half of Brazil's total energy consumption. Therefore, reducing emissions in the energy sector remains a top priority for Brazil. Brazil's Amazon rainforest, one of the most significant carbon sinks in the world, and its hundreds of acres of farmland are also on the country's emissions radar. Without addressing farming emissions and deforestation, Brazil cannot achieve net zero.

EVs will reduce pollution significantly. The biggest obstacle to decarbonization is road transportation because the power industry is already so far ahead. "For Brazil to be on a path to net zero, this sector in Brazil needs to drop emissions faster," Nunes stated. Brazil uses biofuels far more frequently than the majority of other nations. The majority of cars in the nation can now run on gasoline, ethanol, or a combination of the two thanks to a program that was initiated in the wake of the 1973 oil crisis and established a domestic ethanol industry. The world's second-largest exporter of ethanol is Brazil. However, it is anticipated that electrification will progressively take over passenger cars over the next 20 years, mostly due to cost. Even in the best-case scenario, battery-electric vehicles will account for 59% of Brazilian sales by 2040, up from just 1% in 2023, according to BNEF. The cost of net zero is only little higher. All things considered, the net-zero scenario proposed by BNEF is only about 8% more expensive than the least expensive strategies for growing the economy between 2024 and 2050. Among the additional investment requirements are the market and governmental intervention required for technologies such as sustainable aviation fuel and carbon capture and storage. The base case analysis only considers the capital expenditure and ignores the operating costs of a fossil fuel-based system. Additionally, it fails to account for the additional costs of adaption in a 2.6C world as opposed to a 1.75C one, which implies make funding climate action even more valuable, according to the analysis — which might soon make Brazil's shift to a net-zero economy more affordable than not doing so, Nunes said. "You're not building that many fossil fuels if you're building that many more renewables," he stated. "Therefore, one thing makes up for the other."