Brazil's biofuels - boom or climate bust?
Brazil's current push to expand biofuels is central to its strategy to "drive the decarbonisation agenda" and build a robust "bioeconomy", setting the stage for this to become a major focus at the upcoming UN Climate Change Conference (COP 30) in Brazil in November 2025.
"Brazil will lead the world’s energy revolution," declared president Luiz Inácio Lula da Silva during a ceremony at the Brasilia Air Base in October. This statement came as he signed the Fuel of the Future Law, a set of initiatives aimed at advancing the country’s bioenergy sector.
“Brazil will get a head start because you, the entrepreneurs, who have the capacity to produce, to research. Enacting this law demonstrates that none of us have the right to continue disbelieving that this country can be a large economy,” added Lula.
Gasoline
Lula announced a rise in ethanol blending with gasoline from 22 per cent to 27 per cent, with a target of 35 per cent by 2030. Biodiesel blending, currently at 14 per cent, will increase by one percentage point annually, aiming to reach 20 per cent by March 2030.
Biofuel mandates have generated a relentless demand for crops, including sugarcane, corn, soybean, and palm oil.
Ethanol and biodiesel production in Brazil reached nearly 43 billion litres in 2023, according to the 2024 Brazilian Statistical Yearbook on Oil, Natural Gas, and Biofuels, published by Brazil's National Agency for Petroleum, Natural Gas, and Biofuels (ANP).
In Brazil, biofuels make up 25 per cent of transportation fuels - a remarkably high share compared to other nations - and this proportion is still increasing. Bioethanol leads the biofuel sector, representing an average of 49 per cent in terms of energy of the total gasoline and ethanol consumption.
Jorge Ernesto Rodriguez Morales is lecturer and researcher in environmental policy and climate change governance at the Department of Economic History and International Relations at Stockholm University.
Production
Biofuel mandates have generated a relentless demand for crops, including sugarcane, corn, soybean, and palm oil.
They said: "Historically, Brazilian energy policy has achieved significant success, largely due to the development of the oil industry alongside biofuels and other energy sources. This diversification has enabled Brazil to rely less on energy imports from the global market, fostering a degree of energy independence and security critical for economic stability.
“By reducing dependence on external energy sources, Brazil’s economy is less vulnerable to external shocks, such as fluctuations in oil and gas prices.
"Sugarcane ethanol, in particular, has been pivotal in these developments, positioning bioenergy - a renewable energy form derived from recently living organic materials known as biomass - at the forefront of national strategies to combat climate change."
Although bioenergy has been promoted as a climate strategy, there is ongoing debate within the scientific community regarding the actual sustainability of biofuel production.
Some scientists argue that the production of biofuels is an energy-negative process that may lead to various socio-environmental consequences.
These include rising food prices that threaten food security and the conversion of forestlands for biofuel cultivation. Some state that presenting bioenergy as a climate strategy has served as a justification for the industry's expansion in Brazil and globally.
Ecosystem
"Despite its success, the biofuels industry in Brazil developed within broader developmental and territorial security goals, often placing significant pressure on ecosystems and communities in an institutional environment that generally overlooked socio-environmental concerns.
"This unsustainable co-evolution of development pathways and bioenergy - marked by deforestation, land colonisation, and agricultural expansion - has limited the adaptation space in agriculture.
"As a result, current climate policy is largely oriented toward path-dependent and potentially maladaptive strategies, such as relying on sugarcane ethanol for transportation," explained Morales.
A report by the Royal Society raises concerns about expanding biofuel production, highlighting issues such as the impact on food prices, the potential rise in greenhouse gas emissions due to direct and indirect land use changes (LUC) associated with biofuel feedstock production, and the risks of land, forest, water resource, and ecosystem degradation.
The Royal Society report recommends comprehensive auditing of biofuel supply chains as essential, along with enhancing transparency, data availability, and sharing. These elements are crucial for ensuring that the life cycle assessment (LCA) of biofuels is reliable and beneficial for policymaking.
Fuel-grade
The use of feedstocks like sugarcane, palm oil, corn, and soybean - predominant in Brazil - has sparked significant controversy, primarily due to competition with food production and concerns about converting agricultural land into fuel production.
Rising demand for agricultural products poses a risk of increased deforestation and the use of land with high biodiversity value to satisfy this demand, along with related freshwater consumption.
The EU Deforestation-Free Regulation (EUDR) identifies soybean as one of the world's leading drivers of deforestation. Trade interests appear to be the main barrier to removing soy biofuels from the Renewable Energy Directive, as Europe imports nearly 90 per cent of its soy for biodiesel production from Brazil, Argentina, and the United States.
Dr David Pimentel, a professor of ecology and agricultural sciences at Cornell University, asserted that there is insufficient land, water, and energy available for biofuel production. He also highlighted environmental issues associated with converting crops into biofuels, such as water pollution from fertilisers and pesticides, air pollution, soil erosion, and contributions to global warming.
Pimentel conducted calculations that accounted for all the inputs needed to produce ethanol, including machinery, seeds, labour, water, electricity, fertilisers, insecticides, herbicides, fuel, drying, and transportation. He found that producing one litre of fuel-grade ethanol (5,130 kcal) requires an energy input of 6,600 kcal, indicating that biofuel production is an energy-negative process.
Security
A report published in the Biofuel journal states that measuring greenhouse gas emissions linked to ethanol fuel should account for emissions at every stage, including production, processing, distribution, and vehicle use.
This comprehensive assessment is known as the core “well-to-wheels LCA emissions, along with any additional emissions resulting from LUC. Morales discussed some of the impacts of implementing a climate policy that relies on biomass fuels.
"Current climate policy positions biomass-based fuels as a replacement for fossil fuels in the transport sector, with sugarcane ethanol as a flagship solution for greenhouse gas reduction in international climate negotiations. However, scaling up bioenergy production can have serious socio-environmental impacts, " he said.
“Like food production, ethanol requires land, water, and nutrients, meaning that a large-scale expansion could intensify the negative side effects of agricultural growth.
"These include significant socio-environmental challenges related to sustainable development goals, such as deforestation (SDG 15), CO2 emissions from land-use change (SDG 13), nitrogen losses (SDGs 13, 14, 15), unsustainable water withdrawals (SDG 14), and food security risks (SDG 2), among others."
Deforestation
During Brazil’s colonial period (1500-1822), sugarcane plantations established the basis for political power through land monopoly and slavery. Policies were implemented to promote the economic interests of the agribusiness sector.
In response to the energy and sugar crisis of the 70s, Brazil launched a national ethanol program called Pró-Álcool in 1975. This initiative included tax breaks, subsidies, and lower financing costs to benefit the sugarcane industry, including producers, planters, distillers, and the automotive sector.
The Pró-Álcool policy led to significant repercussions, such as the exploitation of workers (bóias-frias) and environmental degradation, which the Brazilian government neglected out of concern that environmental regulations might hinder economic growth and development.
From 1992 to 2004, while Brazil's total greenhouse gas emissions rose by 80 per cent, the government defended its support for ethanol on environmental grounds, positioning bioenergy as a 'sustainable' energy source. This approach framed bioenergy as part of a climate strategy, leading to its promotion at international levels to combat climate change.
However, the socio-environmental impacts of bioenergy production were largely overlooked, including direct and indirect LUC, water and biodiversity loss, deforestation, fertiliser pollution, and soil erosion.
Diplomacy
In 2017, the Renovabio initiative was launched as a new government programme aimed at promoting the growth of the bioenergy sector, with an emphasis on various types of biofuels, such as biodiesel, biomethane, bioethanol, and biokerosene.
A report published in the Biofuels journal indicates that Brazil's RenovaBio programme does not account for direct or indirect LUC in its emissions calculator, potentially leading to an overestimation of decarbonisation levels and encouraging biofuel production with greater environmental impacts.
To ensure the programme is environmentally effective and delivers appropriate signals to decision-makers, it is crucial to incorporate LUC parameters into the calculator.
"Brazil’s ethanol diplomacy aims to portray the nation as climate-conscious, using biofuel as leverage in climate negotiations. Many countries have followed Brazil’s 'successful' example by integrating bioenergy into their climate policies, even though its social and environmental costs are widely acknowledged,” mentioned Morales.
Refinery
Raízen (formed from the merger of Cosan and Shell) along with BP Bunge, Atvos, São Martinho, Tereos, Lincoln Junqueira, Cofco, Coruipe, Adecoagro, Katzen, Millenium, Brasil BioFuels (BBF), and Agropalma, represent some of the leading bioenergy companies in Brazil.
In October, Katzen International, a prominent bioethanol company, announced the successful completion and launch of the INPASA Agroindustrial S/A bioethanol plant expansion project in Sinop, Mato Grosso.
This expansion boosted the plant’s production capacity to 2.1 billion litres per year, establishing it as the largest grain-based dry mill bioethanol facility in the world.
Corn ethanol production in Brazil is projected to reach 7.7 billion litres in 2024/25, representing a 20 per cent increase compared to previous years.
The biofuel industry is making significant investments in the state of Pará. Governor Helder Barbalho has announced plans for a biofuel refinery to be established in the municipality of Redenção, located in the southeastern part of the state.
Plantations
A collaboration between the Mafra Group and Companhia Mineira de Açúcar e Álcool (CMAA), which together comprise Grão Pará Bioenergia, will contribute over $350 million to this project.
“These are the agendas that will be challenging for us: the forest agenda, the energy production agenda. These are different agendas in which each one of them can present their solutions,” said Barbalho.
Alongside the refinery, a fattening service for cattle will be provided to partner ranchers, allowing them to use the refinery's facilities for confining their animals. The primary feedstock for cattle confinement will be Dried Distillers Grain (DDG), a by-product of corn ethanol production.
A report by NGO Imazon revealed that Pará accounted for 57 per cent of the degraded forest areas in the Amazon. Forest degradation surged from 196 km² in September 2023 to 11,558 km² in the same month this year – nearly a 60-fold increase.
The state of Pará, which will host COP30, is marked by conflicts, including those related to the palm oil industry. Palm plantations in Pará cover an area that was once rainforest, approximately 226,834 hectares, nearly equivalent to the size of Luxembourg.
Triggering
An investigation by the NGO Global Witness revealed that two major Brazilian palm oil companies, Agropalma and BBF, were implicated in conflicts with local communities in the state of Pará.
BBF faced allegations of environmental crimes and efforts to suppress indigenous and traditional communities. Meanwhile, Agropalma was associated with community evictions and land grabbing.
A study by scientists Lucas Ferrante and Philip Fearnside revealed that biofuel companies, such as Millenium Bioenergia, are establishing a production chain for biofuels and food products derived from monocultures on Amazonian Indigenous lands and within other traditional communities.
Millenium announced plans to "partner" with Indigenous and traditional communities, proposing unpaid labour to produce corn, fish, chickens, pigs, and confined cattle. This approach not only infringes on human rights but also poses a risk of triggering new pandemics due to zoonotic leaps linked to environmental degradation.
Brazil must expand biofuel production to meet growing demand, which will increase logistical pressures nationwide.
Greenwashing
Critical to this expansion are infrastructure projects, such as the construction of highways like the Amazon’s BR-319, connecting Manaus to Porto Velho, and the Ferrogrão railway project, linking Sinop in Mato Grosso to the port of Miritituba, situated across the Tapajós River from Itaituba in Pará.
These developments are likely to cause irreversible environmental degradation and adversely affect numerous indigenous and traditional communities in these areas.
Morales highlighted the Brazilian government’s position and priorities concerning the expansion of biofuel production.
"In foreign environmental policy, the Brazilian government has historically been reluctant to prioritise environmental protection over economic growth, often attributing major environmental issues to developed countries," he said.
"Although various administrations have made efforts to address environmental challenges such as biodiversity loss and climate change, these issues remain secondary concerns, frequently viewed as obstacles to short-term political and economic goals.
"Positioning bioenergy as a climate strategy has effectively justified broader policies supporting the biofuel industry and contributed to the greenwashing of Brazil's climate policy on the international stage. Several countries have mirrored Brazil’s approach, adopting bioenergy into their climate agendas in response," he added.
This Author
Monica Piccinini is a regular contributor to The Ecologist and a freelance writer focused on environmental, health and human rights issues.
