Brazil Puts a $10 Billion-a-Year Price Tag on Carbon Neutrality
Brazil Puts a $10 Billion-a-Year Price Tag on Carbon Neutrality
(Bloomberg) -- Brazil will set a new goal to zero out carbon dioxide emissions by 2060—or sooner, if it can raise $10 billion a year from other countries.
Under the plan, developed nations can start making payments into a federal government program to protect forests starting next year, Environment Minister Ricardo Salles said on Tuesday. “Brazil is once again showing its commitment to climate issues, to the planet,” Salles said during a presentation to reporters.
Brazil, South America’s top-emitting nation, is home to a large part of the Amazon rainforest, which has seen a jump in wildfires and deforestation over the past two years. The country has faced global outrage as fires have destroyed large swaths of the precious biome, the world’s largest tropical rainforest, and the Pantanal, the world’s largest wetland. President Jair Bolsonaro, who’s governed with a far-right-wing agenda, has been a strong advocate for opening up the Amazon to mining and agriculture, has questioned the existence of climate change, and even publicly clashed with French President Emmanuel Macron over climate issues.
In June, a group of prominent institutional investors responsible for about $3.7 trillion in assets sent a letter to the Brazilian government threatening to withdraw from the country unless environmental metrics improved. In response, Salles has changed tacks, now calling on investors to help the Amazon in unconventional ways such as sponsoring a plot of land, much as a local business might sponsor a stretch of highway.
The proposal is part of Brazil’s new emissions reduction commitment under the 2015 Paris climate agreement, which the Inter-Ministerial Committee on Climate Change approved on Tuesday, Salles said. That commitment, known as a nationally determined contribution or NDC, must be updated every five years. The full revised proposal was made public on Wednesday.
Under its previous Paris Agreement pledge, submitted under left-leaning former President Dilma Rousseff’s government, Brazil promised to reduce emissions 37% by 2025, compared to 2005 levels, and 43% by 2030. It also set the goal of zeroing out illegal deforestation by 2030, reforesting 12 million hectares of the Amazon, and reaching 45% renewable power in the country’s overall energy mix.
Signatories of the Paris Agreement are due to submit new NDCs before the end of the year, with many expected during this week, ahead of a U.K.-hosted climate summit on Saturday.
Salles said Tuesday that the exact conditions under which the country would accelerate its net-zero commitment haven’t yet been determine, but that they’ll depend on developed nations’ willingness to contribute the required $10 billion per year in funding. In the future, these payments could also be made through carbon trading mechanisms contemplated under the Paris Agreement, he added. A framework for a global carbon market hasn’t been approved yet, mainly because countries failed to reach an agreement during marathon climate talks organized by the United Nations in Madrid last year. Brazil was among the nations digging in their heels on technical issues that, in the end, prevented a deal.
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