Sustainable Industry

Carbon Market in Brazil

Article by Monique Gonçalves, Senior Manager for Corporate Relations and Regulatory Affairs at Shell Brasil*

By Monique Gonçalves, Senior Manager for Corporate Relations and Regulatory Affairs at Shell Brasil*

At Shell, we believe that government-led carbon pricing mechanisms are an essential policy tool to combat climate change. We also believe that the private sector plays a key role in this discussion, considering the potential for investments in this market and the generation of socio-environmental and economic benefits on the ground. And the establishment of a carbon market would give Brazil a mechanism that could greatly contribute to the fulfillment of its climate commitments and also support companies in their upgrade process through decarbonization, energy efficiency and international competitiveness in a low carbon world.

Setting clear and internationally recognized rules is imperative and could make investments attraction more transparent and predictable. The first step should be taken; Brazil cannot trail behind.

One thing is for sure – when it comes to the Carbon Market, some quality and environmental integrity assumptions must be in place, such as clear rules for measurement, reporting and verification – MRV. In this regard, Shell believes that assuring quality and integrity of carbon credits also involves criteria that go beyond international standard certifications, and include, for instance, actions to ensure environmental and social safeguards, additionality, conservative methodologies for quantifying emission reductions and removals, among others. A robust carbon market needs to rely on rules that provide a minimum standard of security for these credits.

Our country has been discussing the Carbon Market issue extensively in recent years, with in-depth debates of technical assumptions and analysis of various models. Carbon pricing should be applied to as many sectors of the economy as possible and evolve over time. Policies should be based on robust and transparent modeling of the impacts of carbon pricing on consumers and the industrial sector.

Whichever path is chosen, ongoing engagement with civil society is necessary and concrete actions must be taken towards a net-zero emissions future in a cost-effective manner.

* Monique Gonçalves has over 20 years of experience in Oil and Gas at Shell, the BG Group and Enterprise Oil. She has held positions in Government Relations and Regulatory Affairs, and for the past five years has led Shell Brasil’s Energy Transition Program, its climate agenda and support for new renewables and electric power businesses. Monique has a degree in Law from the Federal University of Rio de Janeiro (UFRJ), with a specialization in Regulation and management of oil and gas businesses from Fundação Getúlio Vargas (FGV-RJ).