Thursday, 28 November 2024.
Another great meeting at the Mattos Filho law firm, in São Paulo, Brazil, on November 26th, to discuss the new set of Brazilian rules relating to the so-called “Fuels of the Future”.
Besides presentations by the main partners of the practices involved, companies working at the forefront of the topic in Brazil also presented their cases. Famous slogan from the 90s that we like to quote here at Carbon Credit Markets: “it’s people who do it”.
At the opening, Giovani Loss, partner in the Infrastructure and Energy practice, surprised everyone by projecting a live connection with congressman Arnaldo Jardim, directly from Brasília. The congressman, graduated in civil engineering from the Polytechnic School of the University of São Paulo, remains a key leader in political negotiations involving these issues with so many technological and innovation nuances, having been one of the main interlocutors in the approval of the legislation.
At the end of his online exhibition, he highlighted the role of the private sector and shared the Monitor Energia Do Futuro portal, with very interesting information about technologies, projects, companies and comparisons between countries.
Then, after a brief introduction by Environmental practice partner Antonio Augusto Reis, it was the turn of Felipe Feres, partner in Infrastructure and Energy, to give a very complete presentation entitled “Lei do Combustível do Futuro. Lei nº 14.993/2024”.
Remembering that the law is programmatic, that is, it demands subsequent regulation, he initially showed 7 of the main green fuel projects being implemented or planned in Brazil, totaling investments of around USD 5 billion.
Next, he discussed the programs and changes introduced by the law:
Sustainable Aviation Fuel “ProBioQAV” (SAF)
Green Diesel “PNDV”
Changes relating to Biodiesel and Ethanol
Changes related to synthetic fuels and capture and geological storage of CO2
Sustainable Mobility
Decarbonization of Natural Gas Producers and Importers and Biomethane Incentives
Of particular note is the change in the percentage of ethanol mixed into gasoline, which goes from the 18-27.5% range to the 22-35% range.
Regarding capture and geological storage of CO2, the grants will have a term of 30 years, extendable for an equal period. On the other hand, the law does not cover the gas injection process for enhanced oil recovery, an increasingly common practice in the oil sector.
Anyway, very rich content.
Felipe Feres kindly shared the 11 slides with us, which are below for download.
Regarding the cases presented, we will publish specific articles in due course, which briefly address the following initiatives:
Azul Linhas Aéreas: SAF costs in practice
Acelen / Mubadala: SAF for export from macaúba oil
FS Fueling Sustainability / Summit Agricultural Group / ICM / Tapajós: corn ethanol in Brazil + Bioenegy Carbon Capture and Storage (BEECS), with the potential of a negative carbon cycle
European Energy: bringing to Brazil the e-methanol experience from the Kassø plant in Denmark, and with an eye on the significant fleet of methanol ships under construction.
Concluding the event, in addition to considerations from other Mattos Filho members such as Bruno Chedid on the energy sector and Tábata Boccanera on the new carbon credit law, we highlight the recommendations from Thiago Moreira, partner in the Infrastructure and Energy practice and responsible for complex contracts, prototype technologies:
Lawyers and engineers must work together
Understand the whole and the risk matrix
Careful hand over between design and implementation
Do not leave it to negotiate with insurance companies at the end
