Biodiesel in Brazil: Challenges and Opportunities for a Sustainable Energy Transition

This chapter appeared in Hirdan Katarina de Medeiros Costa, Energy Transition, Generational Justice and Climate Change: The Role of Fossil Fuels and Low Carbon Economy (Letra Capital Editora, 2021). A Portuguese version is available from Lumen Juris.

Abstract

The objective of this research was to assess the Brazil's National Program for Biodiesel Production and Use (PNPB), started in 2005. This program established a compulsory market for biodiesel blends, which gradually expanded to current B13 (temporarily B10) with a forecast of B15 by 2023, including targets for regional development and social inclusion. Petrobras plays a central role in the commercialization of biodiesel through public auctions, but this company made a significant divestment in this sector in recent years. In addition, fleet electrification trends and innovation in the production of advanced biofuels for diesel engines imply revisions in regulation. We suggest that no barriers to improvements should be imposed on those that reduce greenhouse gas emissions and that increase the overall efficiency of the biodiesel production processes. This sector has already achieved the necessary maturity level to move from the current auction system to a fully open market, which would enable greater competitiveness through free negotiations between distributors and processing facilities. Equally important is to improve the effectiveness of the "social fuel seal" program. This transition should occur through a systems perspective, not only looking at the biodiesel economic viability, but also at social inclusion, rural development, environmental services, and future technologies.