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Brazil, Germany in talks for hydrogen pilot project

  • Market: Biofuels, Emissions, Hydrogen
  • 22/10/20

Brazil is in talks with Germany for a pilot project to produce green hydrogen from its abundant renewable energy sources, but it must first overcome logistical bottlenecks, industry specialists said in a recent webinar co-hosted by the Brazilian government and Germany's Konrad Adenauer Foundation (KAS).

Brazil already has one of the world's cleanest energy mixes, with both a strong biofuels industry and a heavily renewable power generation matrix. But the country has yet to tap into its renewable energy base to produce green hydrogen.

Small steps are underway. Brazil began holding public hearings in July to define a regulatory framework for hydrogen fuel. And the government included green hydrogen in its long-term energy plan for 2050, which is expected to unlock potential financing.

"Brazil still does not have public policies for green hydrogen. Currently, this is still not a big problem," said Lavinia Hollanda, the executive director of Escopo Energia. "But in the near future, we need to develop a long-term plan so we have the infrastructure in place when it is needed."

According to estimates by the hydrogen research laboratory at the Rio de Janeiro federal university, green hydrogen has the potential to account for 8pc of Brazil's total energy consumption by 2050.

Brazil also has potential to be a green hydrogen exporter in the medium term. Details of the talks that Brazil's mines and energy ministry is holding with its German counterpart for the pilot project are still sketchy, but the objective would be to export the new fuel to Europe. The EU recently unveiled plans to build 40GW of hydrogen electrolyzing capacity by 2030, leaving the door open for Brazil to supply the trade bloc, said Giovani Machado, director of energy economics and environmental studies at the energy ministry.

Green hydrogen is produced using biomass, biofuels such as ethanol or biogas as feedstock. Domestically, hydrogen is well suited as a liquid fuel to power batteries that could be used in electric long-haul trucking and aircraft equipped for such technologies, two areas of demand that are largely limited to liquid fuels such as diesel or natural gas at present, according to Hubertus Bardt, an economist at the German Economic Institute.

"Development of the technology over the next decade could be remarkable, especially with the strong demand from heavy vehicles, such as city bus systems, which would allow a more centralized distribution infrastructure for the hydrogen fuel," thus reducing costs, according to Paulo Emilio de Miranda, the head of the hydrogen research laboratory.

"We need shipping capacity that does not exist today with new technology to store and carry hydrogen, as well as pipeline and storage facilities. It will mean big investments," Machado said, adding that there are no current technologies in place to transport and store liquid hydrogen via pipelines or shipping, which would require policies to lead major infrastructure investment.


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10/01/25

US issues 45Z tax guidance for low-carbon fuels

US issues 45Z tax guidance for low-carbon fuels

Washington, 10 January (Argus) — US producers of low-carbon fuels can start claiming the "45Z" tax credit providing up to $1/USG for road use and $1.75/USG for aviation, following the US Treasury Department's release today of proposed guidance for the credit. The guidance includes proposed regulations and other tools to determine the eligibility of fuels for the 45Z tax credit, which was created by the Inflation Reduction Act to replace a suite of incentives for biofuels that expired at the end of last year. Biofuel producers have been clamoring for guidance from the US Treasury Department so they can start claiming the tax credit, which is available for fuels produced from 1 January 2025 through the end of 2027. "This guidance will help put America on the cutting-edge of future innovation in aviation and renewable fuel while also lowering transportation costs for consumers," US deputy treasury secretary Wally Adeymo said. "Decarbonizing transportation and lowering costs is a win-win for America." The creation of the 45Z tax credit has already prompted a change in US biofuels markets by shifting federal subsidies from blenders to producers. Because the value of tax credit increases for fuels with the lowest lifecycle greenhouse gas (GHG) emissions, it could encourage refiners to source more waste feedstocks such as used cooking oil, rather than conventional crop-based feedstocks. While the guidance is still just a proposal, taxpayers are able to "immediately" use the guidance to claim the 45Z tax credit, until Treasury issues additional guidance, an administration official said. The guidance on 45Z released today affirms that only the producer for the fuel is eligible to claim the credit, not blenders. To be eligible for the tax credit, the fuel must have a "practical or commercial fitness for use in a highway vehicle or aircraft" by itself or when blended into a mixture, Treasury said. Marine diesel and methanol suitable for highway or aircraft use are also eligible for 45Z, as is renewable natural gas that can be used as a transportation fuel. Treasury also released an "annual emissions rate table" offering providers a methodology for determining the lifecycle GHG of fuel. Treasury said a key emissions model from the US Department of Energy, called 45ZCF-GREET, used to calculate the value of the 45Z tax credit is anticipated to be released today, although industry officials said it may be delayed until next week. Treasury said it intends to propose regulations at "a future date" for calculating the GHG emissions benefits of "climate smart agriculture" practices for "cultivating domestic corn, soybeans, and sorghum as feedstocks" for fuel. Those regulations could lower the calculated lifecycle emissions of fuel from those crop-based feedstocks and increase the relative 45Z tax credit. US biofuel producers said they are still awaiting key details on the 45Z tax credit, including the update to the GREET model. Among the outstanding questions is if the guidance released today provides "enough certainty to negotiate feedstock and fuel offtake agreements going forward", said the Clean Fuels America Alliance, an industry group that represents the biodiesel, renewable diesel and sustainable aviation fuel industries. It is unclear how president-elect Donald Trump intends to approach this proposed approach for the 45Z credit, which will be subject to a 90-day public comment period. Trump has promised to "rescind all unspent funds" from the Inflation Reduction Act. But outright repealing 45Z would leave biofuels producers and farmers without a subsidy they say is needed to sustain growth, after the expiration last year of a $1/USG blender tax credit and a tax credit of up to $1.75/USG for sustainable aviation fuel. Biofuel and soybean groups were unsuccessful in a push last year to extend the expiring biofuel tax credits. The 45Z credit is likely to be debated in Congress this year, as Republicans consider repealing parts of the Inflation Reduction Act. House Republicans have already asked for input on revisions to the 45Z credit, signaling they could modify the incentive. In a tightly divided Congress, farm-state lawmakers may hold enough leverage to ensure some type of biofuel incentive — and potentially one friendlier to agricultural producers than 45Z — survives. By Chris Knight and Cole Martin Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Mercosur-EU deal to open Brazil ethanol flows


10/01/25
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10/01/25

Mercosur-EU deal to open Brazil ethanol flows

Sao Paulo, 10 January (Argus) — A freshly inked EU-Mercosur trade agreement marks an important opportunity for Brazil's burgeoning ethanol market, but will likely not significantly impact the country's well established sugar trade. Announced in December, the landmark pact provides for the gradual exemption of tariffs on most exports from the four participating Mercosur countries to the 27 European countries that make up the EU. Goods considered sensitive, including sugar and ethanol, will be subject to a quota system with more limited benefits. Export quotas for specific products from each of the participating South American countries — founding members Argentina, Brazil, Paraguay and Uruguay — will be defined after the ratification of the agreement. For industrial ethanol originating in Mercosur and shipped to the EU, the agreement provides a maximum quota of 570,300 m³/yr (9,845 b/d), with tariffs gradually reduced to zero over the years. Non-industrial ethanol will have a quota of 253,400m³/yr, subject to a reduced tariff of €34-64/m³ ($34.82-65.55/m³), a third of current rates. The EU tariff on imported ethanol today ranges from €102/m³ for the denatured product — which includes chemical additives that make it unfit for consumption — to €192/m³ for the undenatured product. Quotas provided for in the agreement are more than enough to cover volumes Brazil exports to the EU. The South American country shipped 140,700 m³ of ethanol to countries in the European bloc in 2024, around 7pc of the 1.9mn m³ it exported in the year, according to trade ministry data. The terms of the agreement have caught the attention of market participants, who see an opportunity to revive trade flows to Europe, especially for industrial ethanol. EU countries soaked up around 30pc of Brazil's ethanol exports in 2022, but outflows have dropped significantly since. At the time, Brazil's ethanol gained a competitive edge during a period of rising energy prices in Europe amid the start of the Ukraine-Russia conflict and the aftershocks of the Covid-19 pandemic. The announcement of the agreement has put the EU back on the radar of Brazilian traders who stopped selling ethanol to Europe or those who are yet to enter the market. Slight impact for sugar The agreement is set to have less of an impact on Brazilian sugar exports, considering the approved quota and the volume normally exported to the EU. Mercosur will have a quota to send 180,000 metric tonnes (t)/yr of sugar to the European bloc with zero tariffs, while the excess volumes of raw sugar will face the current customs duty of €98/t. The tariff-free volume represents a small portion of the total sweetener normally shipped to the European bloc. Brazil's center-south — which includes the main producing states — alone exported 540,000t of sugar to the EU in January-November 2024, according to sugar and ethanol industry association Unica. Raw sugar accounted for around 87pc of that total. Shipments in 2024 were still below the 804,000 t/yr five-year average for Brazilian sugar exports to the EU. If volumes in the coming years remain close to historical levels, less than 25pc of the annual volume shipped from Brazil will benefit from the new import duties. The EU is expected to import 2.4mn t of sugar in the 2024-25 crop, which extends from October 2024 to September 2025. The volume makes the bloc the third largest importer in the world, only behind Indonesia and China, according to US Department of Agriculture data. The volume approved in the agreement with Mercosur would represent less than 5pc of the imports expected by the EU, which limits the potential competitiveness of Brazilian sugar in the European market. Negotiations on terms of the Mercosur-EU agreement have been concluded, but the pact will only enter into force after final signing and subsequent ratification. By Maria Lígia Barros and Maria Albuquerque Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Global agencies agree 2024 was hottest year recorded


10/01/25
News
10/01/25

Global agencies agree 2024 was hottest year recorded

London, 10 January (Argus) — Six international science and weather institutions have separately found that 2024 was the hottest year on record, the World Meteorological Organisation (WMO) said today. The organisations co-ordinated to release their 2024 average temperature data on the same day, "to underline the exceptional conditions experienced during 2024," the WMO said. The WMO uses data from the six agencies — the UK's Met Office, Japan's Meteorological Agency (JMA), US non-profit Berkeley Earth, the EU's Copernicus and the US' National Oceanic and Atmospheric Administration (NOAA) and National Aeronautics and Space Administration (Nasa). The global average surface temperature in 2024 was 1.55°C above the pre-industrial average, with a margin of uncertainty of 0.13°C either above or below that figure, WMO found in its analysis of the six datasets. This makes it "likely" that the world has experienced the first calendar year breaching the 1.5°C limit pursued by the Paris climate accord. Climate scientists use a timeframe of 1850-1900 for the pre-industrial average temperature. The Paris agreement seeks to limit global heating to "well below" 2°C above pre-industrial levels, and preferably to 1.5°C. All six datasets put 2024 as the hottest year on record and flag up the recent rate of warming, but "not all show the temperature anomaly above 1.5°C due to differing methodologies," WMO said. Copernicus found the global average temperature in 2024 was 1.6°C above pre-industrial levels. "Individual years pushing past the 1.5°C limit do not mean the long-term goal is shot," UN secretary-general Antonio Guterres said. "There's still time to avoid the worst of climate catastrophe. But leaders must act — now." He urged governments to submit new national climate action plans this year. The temperature limits sought by the Paris agreement work on a timeframe of 20 years or longer, Copernicus said. Long-term global warming is currently about 1.3°C above the pre-industrial baseline, a team of experts established by WMO found. "We've had not just one or two record-breaking years, but a full 10-year series," said WMO secretary-general Celeste Saulo. "This has been accompanied by devastating and extreme weather, rising sea levels and melting ice, all powered by record-breaking greenhouse gas levels due to human activities." The UK Met Office outlook finds that 2025 is likely to be one of the three warmest years, in terms of global average temperature, "falling in line just behind 2024 and 2023", it said today. By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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2024 was hottest year on record: EU’s Copernicus


10/01/25
News
10/01/25

2024 was hottest year on record: EU’s Copernicus

London, 10 January (Argus) — Last year was the hottest year globally since records began in 1850, and the first calendar year to breach the 1.5°C temperature limit sought by the Paris climate agreement, EU earth-monitoring service Copernicus said today. The global average surface air temperature in 2024 was 15.10°C — 0.12°C higher than previous hottest year 2023 and 0.72°C higher than the 1991-2020 average, Copernicus found. The global average temperature in 2024 was 1.6°C higher than an estimate of the pre-industrial average, Copernicus data show — the first calendar year to breach the temperature limit pursued by the Paris accord. The two-year average for 2023-24 "also exceeds this threshold", Copernicus said. The Paris agreement seeks to limit the rise in temperature to "well below" 2°C above pre-industrial levels, and preferably to 1.5°C. This "does not mean we have breached the limit set by the Paris agreement", which "refers to temperature anomalies averaged over at least 20 years", Copernicus said. But it "underscores that global temperatures are rising beyond what modern humans have ever experienced", the organisation added. Each year of the past decade — 2015-24 — was one of the hottest ten years on record. And every month since July 2023, apart from July 2024, has breached the 1.5°C level, Copernicus data show. Greenhouse gas (GHG) emissions "remain the main agent of climate change", director of Copernicus Atmosphere Monitoring Service Laurence Rouil said. GHG concentrations are the highest in at least 800,000 years, Copernicus said. Atmospheric concentrations of key GHGs CO2 and methane "continued to increase and reached record annual levels in 2024", it said. CO2 stood at 422 parts per million (ppm) and methane at 1,897 parts per billion (ppb) in 2024 — 2.9ppm and 3ppb higher on the year, respectively, Copernicus data show. While the rate of increase in CO2 "was larger than the rate observed in recent years", the rate of increase in methane was "significantly lower than in the last three years", Copernicus said. An international team of scientists said in November that carbon emissions from fossil fuels were projected to reach a fresh high in 2024 , with "no sign" that these have peaked. Global sea surface temperatures were also above average in 2024 and were a significant force behind the record high surface air temperatures, Copernicus said. Oceans absorb the majority of the world's excess heat. And the amount of water vapour in the atmosphere hit a fresh high in 2024, at around 5pc above the 1991-2020 average, Copernicus found. Climate change is worsening extreme weather events such as floods and storms, studies found. This "reflects the basic physics of climate change — a warmer atmosphere tends to hold more moisture, leading to heavier downpours", research groups World Weather Attribution and Climate Central said in December. By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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UAE commits $40mn to Brazil enviro initiatives


09/01/25
News
09/01/25

UAE commits $40mn to Brazil enviro initiatives

Sao Paulo, 9 January (Argus) — The UAE's Erth Zayed Philanthropies committed $40mn to back Brazilian projects to protect the environment and advance sustainable development. The organization said it plans to support multiple projects in Brazil, including programs to restore ecosystems and eliminate plastic waste in the Amazon, as well as projects that support sustainable farming. It also reaffirmed its commitment to support the Tropical Forests Forever Facility (TFFF), which was launched by Brazil in 2023 and aims to raise funds to protect tropical forests and help countries combat deforestation. The UAE was one of five countries that committed to backing the fund during the biodiversity summit in Colombia in October. The organization announced its plans to support Brazil's environmental protection efforts during the G20 summit in November , following a meeting between Brazilian President Luiz Inacio Lula da Silva and the Crown Prince of Abu Dhabi, Sheikh Khaled bin Mohamed Al Nahyan. Erth Zayed Philanthropies was launched in October and will be used as a vehicle for the UAE to invest in a broad range of charitable projects in sectors including health, education, food security as well as energy and sustainability. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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