The Director of Management Support for the Special Secretariat for Productivity, Employment and Competitiveness of the Ministry of Economy, Jorge Hargrave, admitted that Brazil needs to look ahead and conclude the negotiation of Article 6 of the Rulebook of the Paris Agreement. Hargrave stated that Brazil will not leave the issue for the next COP and that the government will make it happen. The defensive view of the technological revolution was also addressed by the director. The speech was made during the panel “Advances in Carbon Pricing in Brazil: A Position of the Brazilian Business Sector in Relation to Article 6”, carried out by the Business Initiative on Climate (IEC) and CEBDS at COP 25.
“The future is set and it is a carbon-free future, with investment in biotechnology and electromobility, for example. We need to look at how we will adapt. We have to move on from Article 6 and work on internal climate governance,” he argued.
Highlighting the importance of CEBDS publications on the subject, which according to the director were part of the learning curve of the PMR project, of the Ministry of Economy, Hargrave stated that the country does not want to be an obstacle to the process of finalizing the Rulebook, but that we have to understand how to best take advantage of the opportunities. “We have to be concerned with organizing the country and taking advantage of the advantages of having an energy matrix that makes us competitive. We have to change the way we think about governance, putting the government in the planning and the private sector in the implementation. It is important to have a strategic vision, so that the country can position itself in this new market”.
CEBDS President Marina Grossi reinforced the need to strengthen climate governance and pathways to limit global warming to 1.5ºC. “At this COP, we have heard a lot about the need to increase ambition. The current set of NDCs is not enough to keep global warming to 2ºC, much less 1.5ºC. Pricing carbon and stimulating a market for this asset is essential for us to be able to meet our reduction targets.”
Stefano de Clara, IETA’s director of international policy, stressed the need to ensure environmental integrity. “We have learned from the past that if we don’t have clear rules that are credible, we will miss out on business opportunities.”
The need for clear rules for Article 6 was the topic of the speech by UERJ economics professor Ronaldo Seroa da Motta. For him, the country’s challenge only begins with the finalization of the Rulebook. “A learning process is necessary for the carbon market to operate with the lowest transaction costs. This cost minimization is a factor that can leverage emissions mitigation measures and presents opportunities for several sectors of our economy.”
Votorantim Cimentos’ sustainability coordinator, Fabio Cirilo, stated that carbon pricing changes the dynamics of companies and encourages efficiency and innovation in the industry. “In countries without carbon pricing, we carried out the exercise of implementing internal carbon pricing to see how it would impact future investments. This is a game-changer. We believe that industries that are better prepared to deal with carbon pricing will be more competitive. We need to ensure a mechanism in which companies can participate and ensure that the credits generated are in demand and accepted and recognized internationally,” he emphasized.
Jorge Hargrave, from the Ministry of Economy, also advocated including the carbon footprint in products to enhance Brazil’s competitive edge. “If we connect our companies to the grid, with a greater predominance of renewable energy, the product produced in Brazil will emit less than a product made in China, for example. And this needs to be monetized.”
