Brazil’s Energy Outlook 2020 – 2030

Brazil’s vast geography is ideal for the production of renewable energy.

The South American country has the potential to maximize its renewable energy potential in the areas of hydropower, photovoltaics and biomass. 

1. Brazil’s somewhat unfavorable location could explain why the country wants to become energy independent.

To better understand what Brazil is doing in the energy sector, you have to see the world through their eyes. Brazil is far from the well-developed or rapidly growing markets in East Asia, particularly Japan, Singapore and India, and from the resource-rich countries of the Middle East, including Saudi Arabia and Iran. This results in high logistics costs for importing certain raw materials into Brazil.

Of course, Petrobras had high hopes that Brazil would become independent in terms of energy trade. These hopes were quickly dashed because Brazil does not have huge oil and gas reserves off the coast of Sao Paulo. Previously, it had been assumed that Brazil’s material wealth would be much greater. Oil must therefore continue to be transported long distances to Brazil, a country where the local population can afford to buy diesel and gasoline without subsidies.

2. The future of Brazil is biomass, especially sugar cane is seen as the energy future of Brazil.

This partly explains why Brazil is so interested in finding alternative fuels for transportation as an alternative to oil. Brazil quickly found what it was looking for. Sugar cane finds optimal conditions for growth in Brazil, the country is close to the equator and in almost all parts of the country temperatures do not fall to the point where plant growth is significantly impeded, from an agricultural point of view the fact that Brazil has such high solar radiation is more important.

In addition, Brazil has huge water reserves, much of which is not yet fully exploited. These enormous water reserves and dams make Brazil one of the richest countries in the world, perhaps even the richest in water. It provides a good basis for planting sugar cane throughout the year and for using the plant as an economic source of energy.

3. Brazil has enormous hydroelectric potential, which could be further exploited.

The reservoirs are already being used to produce electricity at any time of day, in any season of the year. This raises the question of why not convert hydropower into electricity to produce heat that can be used more. The problem, of course, is that Brazil does not have the industrial infrastructure at all that could use such a surplus of hydropower. There are simply no industrial facilities that need heat, especially not in a country that is in almost every climate region throughout the temperate to tropical year.

4. The surplus energy from Brazilian hydroelectric plants cannot be transmitted to other regions,but there are geographical obstacles.

Transporting excess energy from one place to another, in a country almost as large as the whole of Europe, makes little sense. Moreover, Brazil is heavily dependent on transport by cars and trucks. In fact, the majority of industrial and commercial goods are transported in Brazil by truck. The rail network is very poorly developed, in many places not at all.

And it couldn’t be any different. If you look at the map of Brazil, you quickly see that the Brazilian coast is surrounded by a mountain range. This rugged formation stretches along the Atlantic coast, in the economically strong regions. The expansion of traffic, the construction of highways and railroads is extremely difficult.

5. The real problem that Brazil must overcome is that of transportation. The problem is not energy production. There are solutions. So the goal is biofuels.

Let’s summarize: Surplus hydropower can only be used within a single region because of the distances to be covered, as the infrastructure, including the rail network, is not well developed. Therefore, what Brazil needs is fuel and fuel in large quantities that can be used anywhere. At the same time, Brazil’s oil imports are not really profitable because of the remoteness of energy-rich oil exporters and the limited capacity that ports can handle. Brazil’s hinterland infrastructure is poorly connected to ports. At the same time, markets are close to the coast and inland, demand would not be strong enough and trade benefits would not allow for further expansion of the energy infrastructure. The same is true for energy infrastructure, as Brazil’s power grid.

Sugar cane would not be a permanent solution, even in countries like the United States. In Brazil, the EROI (Energy-Return-On-Energy-Invested) makes the production of fuels from plant residues just as reasonable.

Biofuels are also very interesting because Brazilian cities are very far apart. There are often very few urban settlements in between. The south of the country is often characterized by agricultural landscapes. For this reason, biofuels make sense in an agricultural region with few urban settlements but very large agglomerations.

6. We now come to the real question: why does Brazil want to increase the share of biofuels at the present time, especially fuels produced from sugar cane?

This is mainly due to the Petrobras scandals, which have damaged the image of the oil industry. The involvement of government and industry has helped to bring green fuels back to life. Biofuels, even though their quality is not yet as good as that of regular diesel, are supported by the majority of the population. Biodiesel is also added to the fuel mixture to make it more compatible for engines.

In the case of sugar cane, the figures are considered to be fairly accurate. Because of the large agricultural lobby, an important lobby in Brazil, sugar cane also easily finds approval in the new government.

Many thanks for the shared interest in the energy world!

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