decarbonizing the growth model of brazil: addressing both carbon and energy intensity

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2010 19: 358The Journal of Environment DevelopmentRicardo AbramovayEnergy Intensity

Decarbonizing the Growth Model of Brazil: Addressing Both Carbon and

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DOI: 10.1177/1070496510378102http://jed.sagepub.com

Decarbonizing the Growth Model of Brazil: Addressing Both Carbon and Energy Intensity

Ricardo Abramovay1

AbstractDecarbonization of the world economy involves two challenges. The first is to find new carbon-neutral sources of energy which can reduce the reliance on fossil fuels. Solar, wind, and geothermal energy are the main paths to this energy revolution in most developed and emerging countries. Brazil has a great advantage in this respect as already about half of its energy supply comes from biomass and hydroelectricity. However, economic decarbonization also concerns the use of energy. In this respect, Brazil lags behind. Although the carbon intensity of the Brazilian economy has decreased, its energy intensity is rising. This puts into question the efficiency and ultimately the competitiveness of the Brazilian industrial economy itself. This article analyzes data from the state of São Paulo, the most industrialized state of Brazil, to discuss ways of decarbonizing an emerging economy.

Keywordscorporate socioenvironmental responsibility; Amazon deforestation; energy efficiency; carbon efficiency

Introduction

The year 2009 marks an unparalleled advance of the participation of the state of São Paulo and Brazil in the international efforts to counter global climate changes. For the first time—and only after extreme reluctance on the part of major segments of the federal government and the private sector itself—did Brazil announce the adoption of voluntary targets for emission reduction, which coincides with the unheard-of decrease in the pace of forest destruction in the Amazon region.

In São Paulo, three events prove that the issue is unquestionably on the public agenda:

1University of São Paulo, São Paulo, Brazil



Abramovay 359

1. In August, a group of large companies,1 together with nongovernmental organizations such as the Instituto Ethos and the Fórum Amazônia Susten-tável (“Ethos Institute” and “Sustainable Amazon Region Forum”) announced an environmental charter in which they stated that they intend to publish annual emission inventories, to make investments capable of promoting a reduction of greenhouse gases (GHG) and to interfere in supply chains so that these goals can be achieved. This position is unprecedented and runs counter to the official position of Brazilian diplomacy, which until very recently opposed the adoption of verifiable emission reduction targets by insisting on the historical responsibilities of developed countries. It is also important to point out that these large companies do not only confine them-selves to recommend reduction in forest burnings but also call for monitor-ing of emissions from sectors that have little to do with land use, land use change, and forests (LULUCF).

2. In June 2009, the city of São Paulo approved law 14.933, which created a “climate change policy” and provides for that in 2012 “a reduction of 30% in aggregated anthropogenic emissions stemming from the city activities, expressed in carbon dioxide equivalent of the GHG listed on the Kyoto Protocol (Annex A) in relation to the threshold expressed in the inventory be carried out by the municipal government and completed in 2005.”2

3. The state law on climate changes (13.798) was approved on October 13th and requires that by 2020 emissions are reduced by 20% over the base year 2005. It was the first state law containing quantified goals that has ever been approved in Brazil. This is an important step forward, even if it is recognized that concrete ways for achieving these targets have yet to be developed.

Nevertheless, such positive political achievements cannot conceal the huge uncertainty regarding the pace, intensity, and direction that the decarbonization of the world economy will exhibit in the next few years. The transition to a low-carbon economy (as it was clear in the so-called failure of the Copenhagen conference) is not a linear trajectory but one impacted by conflicts of interest and divergent views about the actual implications of global warming and about the ways to fight it. What is at stake is the relationship between economic growth and the material, energetic, and ecosystemic bases on which it rests. Ultimately, the climate change debate brings to surface the very nature of interest coalitions underlying economic growth processes (North, Walls, & Weingast, 2009) and the conception of control of its dominant actors (Fligstein, 2001).

This text aims at showing the basic elements of this ambivalence between securing sustained economic growth and addressing climate threat. São Paulo can become a decisive player in the world by demonstrating how economic growth can be based on using resources in a way compatible with the preservation of the vital services that ecosystems provide to human societies. To make decarbonization the axis of growth, as determined by municipal and state laws, is justified for three basic reasons: (a) in



360 The Journal of Environment & Development 19(3)

spite of the fact that most Brazilian emissions are currently imputable to the devasta-tion of the Amazon rainforest and the savannahs (Cerrados),3 São Paulo is the largest consumer of products resulting from these predatory production activities and is there-fore responsible for helping to find sustainable ways for using these ecosystems; (b) São Paulo is home to most scientific and technical knowledge in Brazil that can make use of biodiversity from the Cerrado and Amazon region and launch the state’s industry into the most advanced phase of biotechnology, in which biomimicry has an increasingly important weight (Hawken, Amory, & Lovins, 1999; Benyus, 1997); (c) the global importance of the state of São Paulo economy will increasingly rest on its low carbon competitiveness.

Decarbonization of present-day economies depends not only on changes on how to produce energy but also on how to use energy in companies, offices, households, and transportation systems. Brazilian advance is huge—especially that of the state of São Paulo—in clean energy production because of its hydroelectric plants and the impor-tance of ethanol. However, efforts for industrial innovation to lower energy consump-tion as an axis for decarbonization of the economy are still in their infancy.

Advances, Hesitancies, and RetreatsSão Paulo is the epicenter of Brazilian society’s most important socioenvironmental movements and organizations. This reflects both the strength of the state economy and how its public, private, and associative organizations have advanced in incorporating the most important themes of the present-day socioenvironmental agenda. The three events mentioned above in the introduction to this text (state and local laws and the strong business manifestation supported by key NGO’s for the advancement of decar-bonization of the economy) are clear expressions of this process. However, this is a trajectory filled with hesitancies and uncertainties as the advances achieved so far are still incipient.

This part of the article shows the basic elements of this contradictory picture. The central idea is that the competitiveness of the São Paulo economy increasingly depends on its ability to produce wealth with methods and techniques expressly geared to reduce emissions and preserve the main ecosystems of the state.

Legal AdvancesThe most important aspects of local and state laws that were passed in 2009 are not the actual emission reduction objectives defined therein. The targets (30% reduction for São Paulo City by 2012 and 20% reduction for the state of São Paulo by 2020 in rela-tion to 2005) can be better evaluated when the state of São Paulo Emission Inventory is published, which is expected for 2010. The city of São Paulo has an advantage in that its first emission inventory published in 2005 indicates that the transportation sector accounts for almost 80% of total CO2 emissions. Only approximately 10% are from households and 7% from manufacturers (Prefeitura da Cidade de São Paulo, 2005). Thirty-six percent of emissions from the transportation sector come from



Abramovay 361

gasoline-powered vehicles and 33% from diesel-powered ones. The data on which the inventory rests on are from 2003, when the flex-fuel4 vehicle fleet was still negligible. Therefore, it is quite likely that the transportation sector is already decisively contrib-uting toward reaching the municipal emission reduction goals.

The state of São Paulo climate change law is significantly inspired by environmen-tal legislation passed by the U.S. state of California. The fact that there are publicly established targets which trigger a process by which the material and energetic bases of production, consumption, and lifestyles of São Paulo society can be assessed. The legal obligation that inventories are carried out every 5 years by both the state and the city is an important accountability instrument which will make clear whether the tar-gets have been achieved. Each inventory must pave the way for the discussion of the policies recommended by local and state laws, concerning soil use, urban mobility, reduction of traffic jams, the relationship between workplace and places where people live, in short, the space occupancy strategy of the state in general and especially in metropolitan areas. Local and state laws impose a set of regulatory standards on the life and economy of the state, in which the reduction of GHG emissions becomes the basic performance indicator. Ultimately, for the first time, the state’s economic growth strategy is placed within the framework of efficient resources use, as measured by GHG emissions.

This legislative advance is not limited to the city of São Paulo, the state of São Paulo, or the federal government. Other key states in Brazil are starting to adopt carbon emission reduction targets. This is a significant departure from the situation in 2009, when Brazilian government officials and a significant portion of businessmen refused to even discuss targets for reducing the rate of deforestation and to consider decarbon-ization of the Brazilian economy an important issue. A possible reason for the shift can be found in the interests of businesses who depended on exports that could eventu-ally become targets of border-tax adjustments based on carbon content. However, the desire to preempt or avoid such taxes that are being discussed both in the United States and the European Union in the context of new climate legislation does not mean that implementation of such initiatives will be easy.

Tepid Steps Toward Corporate Socioenvironmental ResponsibilityThe commitment to reduce emissions made by a significant group of companies is not an isolated example of an initiative based on social corporate responsibility in Brazil and São Paulo. Historically, one of the most problematic sectors in terms of socioen-vironmental performance in the state economy is sugarcane farming. The sugar cane industry has signed an agreement with the state of São Paulo government to eliminate manual harvesting and as a result burnings during the production process. Manually harvested sugar cane requires previous burning. However, the smoke generated is a significant health hazard for people living near the fields. In addition, burning emits GHG and, therefore, also reduces the net beneficial effects of ethanol as a carbon-neutral fuel. From a social perspective, manual harvesting is debilitating for cane cutters exposed to the smoke 10 hr a day, 6 days a week. Despite the job losses that mechanized sugar cane harvesting may cause, it will solve both the problem of burnings and abolish




labor conditions that are very far from what the International Labor Organization con-siders safe and decent work. In São Paulo state, mechanized sugar cane harvesting will be used in all flat areas by 2013 and mountain areas by 2017.

It is also important to point out that the commitment by large companies and traders not to buy soybeans from newly deforested areas in the Amazon region, demanded and worked out among others by Greenpeace, was renewed in 2009, a commitment that has become to be known as the Soy Moratorium (retrieved April 2, 2010, from http://www .abiove.com.br/english/ss_moratoria_us.html). In addition to renewing the Soy Mora-torium, members of the Roundtable on Soybean met in São Paulo in 2009 to decide on the introduction of experimental devices that will regulate the product certification pro-cess. In 2009, livestock raising was also a target of similar kind of agreements.

The distribution of a Greenpeace report that exposed a group of large companies for purchasing beef and leather from cattle that had been raised in newly deforested areas had two basic impacts.5 First, the report and other accusations of deforestation driven by the cattle-raising sector resulted in a multistakeholders meeting that included environmental groups like Friends of the Earth—Brazilian Amazonia, Empresa Brasileira de Pesquisa Agropecuária (EMBRAPA), the beef industry, and the state government. The common ground developed was that by increasing productivity and higher pasture occupation it would be possible to reduce the impact of cattle raising in the Amazon region. It must be pointed out, however, that there is a lot of resistance to this approach because many ranchers consider the pastures of some areas in the Amazon region especially favorable to cattle raising. In addition to discussing propos-als aimed at improving cattle raising yield per hectare, some larger retailers, many located in São Paulo, are supporting the development of a certification system attest-ing to sustainable cattle-farming practices.

At this point, it is not only uncertain whether these ideas will actually be put into practice but also if they would be able to halt the widening of pastures into the Amazon rain forest. However, it would have been difficult for the São Paulo municipal govern-ment to pass the law (Law No. 15.120) in January 2010 in absence of these private sector initiatives. The law determines that beef to be purchased by the municipal gov-ernment of São Paulo cannot be from cattle raised in areas where illegal deforestation has taken place, including from those areas already embargoed by environmental authorities; neither indigenous peoples’ lands that had been invaded; and shall not contain in its productive chain from the start the use of child and/or slave labor”. Retrieved July 19, 2010 from http://www1.ethos.org.br/EthosWeb/pt/3229/servicos_do_portal/noticias/itens/sao_paulo_aprova_lei_para_boicotar_carne_produzida_com_desmatamento_e_trabalho_escravo.aspx).

The state has also given support to the Roundtable on Sustainable Biofuels, an international initiative with the objective of mitigating GHG emissions.6

These are innovative initiatives but they cannot hide the difficulties that the decar-bonization of the state of São Paulo economy still faces. One of the most important expressions of such difficulties is the position adopted by the Association of Industries of The State of São Paulo (FIESP) during the preparatory discussions for the 15th Conference of the Parties to the Convention on Climate Change (COP15) that took



Abramovay 363

place in Copenhagen in December 2009. One cannot deny the positive role played by the most important Brazilian industrial organization in encouraging discussion and the interest expressed in the issue which resulted in almost thirty industry representatives from business leaders to technical specialists attending COP15. However, FIESP’s position at the conference shows at least part of the difficulties facing a firm commit-ment by Brazil to decarbonizing its economy.7

In the FIESP document, Brazil is presented as at the forefront of the world econo-my’s decarbonization. “What for the world is the future is already the present in Brazil. At the same time that rich countries have historically created an environmental liabil-ity, Brazil has developed an actual Green Economy.” It is correct that, as described by FIESP, the Brazilian energy matrix is cleaner than the one of any other country with an income equivalent or higher than that of Brazil and that this is even more pro-nounced for the state of São Paulo. Based on this fact, FIESP has reached the conclu-sion that the Brazilian commitment in Copenhagen should be restricted to eradicating illegal deforestation. At the same time, the document insists on the fact that production patterns in rich countries are unsustainable and that, under no circumstances, barriers to international trade due to environmental restrictions should be tolerated by the World Trade Organization. As far as industrial companies go, FIESP proposes that they should be encouraged to voluntarily adopt lower emission technologies and opposes the adoption of mandatory emission-reduction targets.

The gap between the position of large companies mentioned in the introduction of this text and the FIESP document is evident, as is the gap between the official repre-sentation of the businessmen and a group of other organizations that place sustain-ability on the top of their agenda. Brazil has a major advantage in that it does not heavily depend on fossil fuels. However, the FIESP position does not take into consid-eration that the need for economic decarbonization and for strengthening the resil-ience of ecosystems are imposing new challenges to innovation in key economic sectors of modern societies.

These challenges are not met merely by changing the energy base of production, which essentially continues to be the same. This is “business as usual.” Necessary are decisive changes that will impact construction and household consumption, transpor-tation and the design of means of transportation, industrial production and the entire material input and output cycle. Some promising steps are under way, despite the many uncertainties about the policies needed to bring them about.

Building a low-carbon economy is a challenge that São Paulo and Brazil are just starting to face. The much cleaner energy matrix it can pride itself with is a huge advan-tage but not a panacea to becoming more energy efficient per unit of production.

São Paulo: The Difficult Transition Into the 21st CenturyA Growth Strategy in the Sustainable Use of Biodiversity

The Brazilian GHG emission inventory currently available was developed by the Ministry of Science and Technology and published in 2004, with data from 1994. The




emissions resulting from the “changes in land and forest use,” at that time, corre-sponded to 55% of the total (Ministério da Ciência e Tecnologia, 2004, p. 85) and farming for 25% of emissions. Some preliminary data from the new emission inven-tory to be published in 2010 have already been announced (Ministério da Ciência e Tecnologia, 2009). The new data provided the basis for the decision by the Brazilian government to announce significant emissions reductions by 2020 during the Copen-hagen Climate Change Conference.

The new emission inventory that uses data from 2005 shows that changes in land and forest use corresponded to 57.5% of Brazilian emissions and farming to 22.1%. Industrial processes still account for a negligible 1.7% and the energy sector for 16.4% of emissions in 2005 (Ministério da Ciência e Tecnologia, 2009a). However, from 2005 onward, these figures must have changed because there has been a considerable reduction in burnings in the Amazon region, as shown in Figure 1.

This trend in reduced deforestation from burning supports the reasoning according to which efforts for the decarbonization of the economy in São Paulo should be restricted to what is already being done for controlling carbon emissions through the use of ethanol and hydropower.

There is no doubt that it is indispensable to significantly and quickly reduce the devastation of the Amazon region and the Cerrado savannahs and that this will greatly help more sustainable modes of land use and use of biodiversity. However, it would be a mistake to think that the participation of São Paulo in this process can be minimized.

Figure 1. Yearly deforestation on Brazilian legal Amazon area (km2)a. Average for 1877 and 1988 values.b. Average for 1993 and 1994 values.c. Estimated.Source: Ministério da Ciência e Tecnologia (2009b).



Abramovay 365

There are at least three reasons why São Paulo must adopt a leading role in dissemi-nating productive practices aimed at decarbonizing the economy and can not limit itself to support Brazilian efforts to reduce and eliminate forest burnings. São Paulo’s economy can benefit substantially on the long term not only from decarbonizing its economic base activities but also by helping to develop and provide the means and knowledge for the sustainable use of biomass and biodiversity which can become the new source for economic growth of the region now threatened by increasing defores-tation and predatory cattle raising.

First of all, São Paulo is unquestionably the most important consumer of the imme-diate products that cause the devastation of the Amazon region. São Paulo is the main buyer of timber from the Amazon region, as shown by the report “Conexões susten-táveis São Paulo—Amazônia—Quem se beneficia com a destruição da Amazônia” [Sustainable connections São Paulo—Amazon region—Who benefits from the destruc-tion of the Amazon region] (Retrieved July 30, 2009, from http://www.reporterbrasil .org.br/documentos/conexoes_sustentaveis.pdf). According to this publication, 23% of the timber taken from the Amazon forest comes to São Paulo. Moreover, this does not cover illegal trade, which is believed to be considerable. State programs such as “São Paulo Friend of the Amazon Region” and the effort for legalizing and certifying timber products are important, but unfortunately these initiatives are far from suffi-cient to halt predatory practices. Beef from cattle raised on pastures from cleared for-est land is also consumed in São Paulo.

The second reason lies in the fact that a decisive part of the scientific research and business activities geared toward sustainable use of biodiversity are located in São Paulo. As documented by the Brazilian Academy of Sciences, the sustainable exploi-tation of the countless economic opportunities offered by forest ecosystems would be one way to overcome the conflict between income generation and preservation of the Amazon region (Academia Brasileira de Ciências, 2008). However, there is an enor-mous gap between the existing need for knowledge of the biomes that exists in the Amazon region and the local capacities to generate this information. Even if, as pro-posed by Edward Wilson (2006), this knowledge is available through public and decentralized cooperation networks that involve students, farmers, river bank popula-tions, and those familiar with the region, collecting, organizing, and analyzing this information requires scientific and technical capacities that the states in the north of the country can only develop in explicit cooperation with the older and more estab-lished universities in Brazil. Many of these research institutions are found in São Paulo and they need to become more involved in scientific and biotechnical capacity building in the Amazon region.

The third reason for São Paulo to have an interest in ending deforestation is that tropical rainforests harbor an immense array of opportunities for the industrial devel-opment. Until now, the Amazon region is seen as important for the global economy only because of its commodities and not because of its biodiversity, its most precious and unique asset. The bulk of public and private investments in the area flow into min-ing, energy generation, farming, and cattle raising, to produce mostly beef, soybean, and low-quality timber. However, the Amazon region must be seen as the new frontier




holding the key to technological innovation for the pharmaceutical, cosmetics, and the expanding biomimicry industries. Biomimicry is technology inspired by the under-standing of adaptive natural processes that can be mimicked for improving human productive capabilities. Many see biomimicry as today’s new technology innovation frontier and the potential economic gains down the road for Brazil and particularly São Paulo are huge (McDonough & Braungart, 2002).

During the 20th century, the world economy can be seen as having passed four key phases of the industrial revolution. The first that lasted until the early 1950’s is char-acterized by the increased use of electricity, advances in chemical engineering, and with the internal combustion engines. The second phase, which extends from the 1950’s to the 1980’s, is economic growth driven by cheap petrochemicals, electronics, aviation, and aerospace industry. In the 1980’s, the digital revolution started unfold-ing, followed by great advances in biotechnologies. Biomimicry started to take off in the mid-1990s fueled by a desire to increase the productivity of natural resources and advances in green chemistry, industrial ecology, renewable energies, and green nano-technology (Lovins, 2008; Zhou, 1996).

Amory Lovins (2008) summarizes the central idea of biomimicry as follows:

The discipline of biomimicry takes nature’s best ideas as a mentor and then imitates these designs and processes to solve human problems. Dozens of lead-ing industrial companies—from Interface Carpets and AT&T to 3M, Hughes Aircraft, Arup Engineers, DuPont, General Electric, Herman Miller, Nike, Royal Dutch Shell, Patagonia, SC Johnson, and many more—use the principles of biomimicry to drive innovation, design superior products, and implement production processes that cost less and work better. (p. 40)

It is in environments of greater biodiversity that most promising potentialities for the advance of this kind of technology can be found. Roberts, Chiou, Marshall, and Cronin (2009), for instance, have discovered a crustacean, at the Great Riff Barrier in Australia, which possesses the most complex vision system known to man, a feature that could be very useful for CD and DVD readers and for polarizing filters used in video or photographic cameras.8

What tropical rainforests have to offer for exploration of this technological frontier is huge. The sustainable exploration of biodiversity is therefore fundamental not only for the preservation of the forest but also because it opens up new opportunities for industrial innovation for those regions with richer and more diversified economic capabilities, as is the case with São Paulo. The continuous devastation of forest eco-systems therefore threatens economic potentials whose magnitude and importance is not known today but promises to be huge.

Carbon Efficiency and Energy EfficiencyIt is true that the energy matrix of São Paulo relays on renewables to a much higher degree than this is the case for the country as a whole. Projections are that by 2020,



Abramovay 367

57% of energy consumed in the state will come from nonfossil fuel sources. This performance is largely explained by the proalcohol ethanol policy and the exploita-tion of the hydropower potential of the state. However, increasingly, public contracts with private suppliers demand adherence to performance standards stipulating atten-tion to social and environmental objectives. Furthermore, in São Paulo, energy cogeneration is also advancing with the increasing use of low-carbon natural gas that results as a side product during oil exploration and of bagasse and straw result-ing from sugar cane production. Even if natural gas is a fossil fuel, its use brings less negative environmental consequences than does the burning of diesel that it fre-quently substitutes.

There is an apparent contradiction between the decline in GHG emissions per unit of product generated by the Brazilian economy and the parallel increase in the total use of energy on the part of the industry. There is a difference between Brazilian and International standards in terms of energy intensity of the economy (i.e., the amount of energy required to produce goods and services that the country requires). Brazil is the country that has reduced its energy intensity least between 1990 and 2005—with the exception of Saudi Arabia—as data from the Energy International Agency and the OECD shows (Table 1).

This demonstrates that a country like Brazil cannot just focus on those sectors where GHG emissions can be reduced quickly and that economic innovation requires that the energy intensity of the whole economy be reduced.

Table 1. Evolution of Energy Intensity of G20 Countries Between 1990 and 2005

Argentina –41.2Australia –40.1Brazil –22.7Canada –37.2China –66France –33Germany –44.8India –48.9Indonesia –34.7Italy –24.6Japan –28.8Mexico –37.1Russia n/dSaudi Arabia +11South Africa –29Republic of Korea –26.5Turkey –33.3United Kingdom –44United States of America –43.6

Source: OECD/IEA (2008).




As São Paulo’s contribution to the high-energy intensity is decisive, it must also lead the initiative to reduce it. Aggregate data show that São Paulo has achieved a notable reduction in the total emission of CO2 from fuel burning, both per inhabitant and as ratio of the state Gross Domestic Product (GDP; Figures 2 and 3). However, energy consumption per unit of product, which has declined in almost all countries of the G-20, has increased in São Paulo as it has for Brazil as a whole.

The sector data shown in Table 2 reveal something even more problematic: the energy intensity in the primary sector drops (which indicates less use of energy in agriculture and mining), that of the third sector remains stable, but industrial energy consumption per unit of production has increased by 26% between 1994 and 2006. This trajectory runs counter to what most developed countries experience, where energy consumption per unit of value produced in industry has declined. Although some of this decline is attributed to the closing of highly inefficient industries in East-ern Europe, most of it is the result of industrial innovation. In China, between 1980 and 2000, the size of the economy grew four times, but energy consumption increased only twofold, as shown by Pan, Zhu, and Chen (2005). This good performance will not be reproduced in the coming years, but Chinese authorities are making consistent efforts to keep economic growth higher than energy consumption. Even in countries where the industrial sector has already reduced energy consumption considerably, energy intensity is projected to continue to fall. Europe’s goal for 2020 is to reduce the consumption of energy by 20% by 2020, below 2005 levels.

Figure 2. Ratio between CO2 emissions by fuel burning and the population of the state of São PauloSource: Taken from State Government of São Paulo, Sanitation and Energy Secretariat, Coordinator of Energy (2008, p. 131).



Abramovay 369

Figure 3. Ratio between the emissions of CO2 by fuel burning and the gross domestic product of the state of São PauloSource: Taken from State Government of São Paulo, Sanitation and Energy Secretariat, Coordinator of Energy (2008; p. 131).

Table 2. Energy Intensity per/by Sector

Sectors 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Primary 0.338 0.362 0.483 0.447 0.352 0.417 0.427 0.24 0.213 0.201 0.215 0.187 0.188Secondarya 0.589 0.605 0.61 0.642 0.724 0.727 0.612 0.663 0.695 0.757 0.734 0.73 0.745Tertiaryb 0.946 0.908 0.962 0.978 0.952 0.97 0.915 0.921 0.918 0.929 0.963 0.931 0.947Total 0.756 0.751 0.794 0.815 0.829 0.846 0.766 0.771 0.771 0.801 0.810 0.790 0.802

Source: Table 7-03, State Government of São Paulo, Sanitation and Energy Secretariat, Coordinator of Energy (2008).Note: Ratio between energy consumption and the state GDP, 103 kcal/R$ for 2005.a. It does not include the energy sector.b. Included in the energy consumption are energy, residential, commercial, public, and transportation sectors.

Energy intensity for the economy of São Paulo (Table 3) shows a significant drop in the use of fossil energy. However, energy intensity almost doubles because of the increased use of biomass and electricity from hydropower. The level of total energy use does not change and this must be seen as a signal that the Brazilian industrial sec-tor is out of step with global energy intensity trends that provide strong incentives for innovation that help increase competitiveness in global markets.

The gap between carbon intensity and energy intensity hints at a significant prob-lem with government policies and incentives designed to encourage innovation and



370

Tab

le 3

. Ene

rgy

Inte

nsity

of E

nerg

y G

roup

s

Sect

or/E

nerg

y19

9419

9519

9619

9719

9819

9920

0020

0120

0220

0320

0420

0520

0620

07

Prim

ary

Fu

els

0.28

10.

300

0.40

70.

376

0.29

0.34

40.

346

0.19

40.

176

0.16

20.

174

0.14

50.

147

0.14

6

Biom

ass

0.00

40.

004

0.00

50.

004

0.00

40.

004

0.00

40.

003

0.00

20.

002

0.00

20.

002

0.00

20.

002

El

ectr

icity

0.05

30.

058

0.07

10.

067

0.05

80.

069

0.07

70.

043

0.03

50.

037

0.03

90.

040.

039

0.03

9

Tota

l0.

338

0.36

20.

483

0.44

70.

352

0.41

70.

427

0.24

0.21

30.

201

0.21

50.

187

0.18

80.

187

Seco

ndar

ya

Fu

els

0.22

80.

230.

236

0.24

50.

256

0.23

60.

198

0.20

50.

203

0.22

10.

204

0.19

70.

200

0.19

6

Biom

ass

0.20

60.

220.

226

0.24

10.

311

0.33

40.

264

0.31

20.

338

0.36

70.

364

0.36

80.

380

0.39

4

Elec

tric

ity0.

155

0.15

50.

148

0.15

60.

157

0.15

70.

150.

146

0.15

40.

169

0.16

60.

165

0.16

50.

165

To

tal

0.58

90.

605

0.61

0.64

20.

724

0.72

70.

612

0.66

30.

695

0.75

70.

734

0.73

0.74

50.

755

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Abramovay 371

economic growth in Brazil. The Brazilian automotive industry is a case in point. Brazil is currently the world’s sixth largest maker of automobiles. There are 12 manufacturers of light commercial vehicles and 6 manufacturers of buses and trucks, with 22 facto-ries scattered across several Brazilian states. Most of them are multinational compa-nies. Until now, research and development of those companies has focused almost exclusively on flexible fuel vehicles, which emit less than conventional vehicles but are still based on the internal combustion engine, a technology whose days are num-bered. Only very recently has the focus of innovation shifted toward the electric car, by all accounts the technology of the future. Furthermore, no regulatory standards have been put in place to stimulate an increase in fuel efficiency of engines, as was the case in the United States when financial support for the troubled car manufacturing industry in 2008 was linked to higher fuel efficiency requirements. A similar shortfall is the fact that despite Brazil’s law on rationalization and reduction in energy con-sumption, Brazil has no implementation policies to reach these goals. The latest Decen-nial Energy Plan of the Federal Government’s Energy Research Company (Empresa de Pesquisa Energética, 2010, pp. 29-30) therefore projects that energy intensity will continue to increase.

ConclusionUntil a few months before the Copenhagen Climate Change Conference, Brazil had adopted a defensive position on the talks on climate changes. The historic responsi-bilities of developed countries for increased levels of GHG in the atmosphere were given as justification for Brazil’s stance that it should not have to make any commit-ments to reduce its emissions. During 2009, this position however changed in a significant way. After intensified domestic debates, São Paulo municipality, the state of São Paulo, other Brazilian states, and the federal government finally adopted con-crete targets for reducing GHG emissions. However, Brazil is focusing mostly on reducing emissions and deforestation in the Amazon region. With respect to the need for emissions reductions, this makes a lot of sense. Social pressure from both Nongov-ernmental Organizations and parts of the private sector were decisive in pushing the Brazilian government to put forward a proposal for significantly reducing deforesta-tion rates at the Copenhagen Conference.

It is important to point out two basic problems with the fulfillment of such a com-mitment. First, the drop in the Amazon region deforestation rate is neither permanent nor irreversible. The Amazon region is still largely seen—both by governmental plan-ning agencies and private sector strategists—as a natural resource provider for energy generation, mining, and large-scale farming and cattle raising (with beef, soybean, and timber in first place). Vested economic interest coalitions that have used the Amazon in a predatory way for a long time may have been somewhat pushed back by some of the current policies enforced to curb illegal deforestation. However, they still largely prevail and, with their strong and even growing ties to international export markets, are not going to go away. Although the use of natural resources based on advanced




scientific and technological knowledge holds great promise, the knowledge, skills, and entrepreneurial practices that can explore, develop, and exploit them effectively are scarce.

The second problem relates to the growth strategy for the Brazilian economy itself. Brazil has the advantage of having an energy matrix that is much more renewable than that of countries with incomes that are equivalent or higher than its income. However, this advantage can become a curse. Brazil’s energy intensity (and that of its most developed state, São Paulo) has continued to grow over the last few years, a trend that runs counter to what major economies in the world experience which continue to become more energy efficient. This is a sign that the technological innovation process itself in Brazil is not keeping up with eco-modernization strategies in the most advanced countries today, which are building their strategy on the understanding that both environmental quality gains as well as innovation and competitiveness will flow from concentrated efforts to reduce the use of materials and energy when offering goods and services.

Declaration of Conflicting InterestsThe author(s) declared no potential conflicts of interest with respect to the authorship and/or publication of this article.

FundingThe author(s) received no financial support for the research and/or authorship of this article.

Notes1. Aflopar, Andrade Gutierrez, Aracruz, Camargo Corrêa, CBMM, Coamo, CPFL, Estre, Grupo

Orsa, Pão de Açúcar, Light, Natura, Nutrimental, Odebrecht, OAS, Polimix, Samarco, Suz-ano, Unica, Vale do Rio Doce, Votorantin e VCP (Dalla Costa. 2010).

2. Retrieved July 19, 2010 from http://www.cetesb.sp.gov.br/geesp/docs/legislacao/municipio_ sao_paulo/sao_paulo/lei_municipal_sp_14933_2009.pdf

3. This is shown by the preliminary version of the Brazilian Emission Inventory put out in 2009 and whose final data (which refers to 2005) are to be announced in October 2010 (Ministry of Science and Technology, 2010).

4. A flexible-fuel vehicle (FFV) is a vehicle with an internal combustion engine designed to run on more than one fuel, usually gasoline blended with either ethanol or methanol fuel, and both fuels are stored in the same common tank (retrieved April 2, 2010, from http://en.wikipedia.org/wiki/Flexible-fuel_vehicle). Introduced in 2003 in Brazil, this technol-ogy has been very successful and nowadays more than 90% of the cars produced in Brazil are “flex.” The advantage is that the consumer is not threatened by a shortage of fuel, for example, when ethanol mills reduce production to produce sugar (consequently shortening ethanol supply).

5. Retrieved April 2, 2010, from http://www.greenpeace.org/international/press/reports/slaughtering-the-amazon

6. Retrieved April 2, 2010, from http://cgse.epfl.ch/page65660.html



Abramovay 373

7. Retrieved February 10, 2010, from http://www.fiesp.com.br/agencianoticias/2009/10/13/mudancas_climaticas_out_2009_finalizado.pdf

8. See also the potential of the discovery of new and superresistant materials based on research on Indian Ocean mollusks (Yao et al., 2010).

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BioRicardo Abramovay is professor of the Department of Economics and the Institute of Interna-tional Relations, University of São Paulo, coordinator of the Socioenvironmental Economy Center (NESA/USP—www.nesa.org.br), and researcher for the CNPq (National Council for Scientific and Technological Development) and FAPESP (The State of São Paulo Research Foundation). He can be reached at www.abramovay.pro.br



decarbonizing the growth model of brazil: addressing both carbon and energy intensity

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