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Trade Made Easy - Sustainability Droplets: Brazil and the Green Hydrogen Revolution

Following our previous post, the interest in green hydrogen and alternative energy sources is not limited to the US; Brazil is another country quoted to be a major player in this transformative segment. Why Brazil?

Brazil holds a substantial capacity for clean hydrogen production, especially due to its energy matrix composed of 85% renewable energy[1] and, of course, due to its continental dimension. Between 2021 and 2022, the country has announced more than 131 large-scale hydrogen projects, with anticipated investments totaling approximately US$ 500 billion by 2030[2]. In this context, the segment presents itself as a strategic opportunity for the country to get well positioned in the global value chain.

Brazil is perfectly positioned to emerge as a global leader in the sustainable energy sector. With the upcoming presidency of the G20, sustainability, and climate change will be top priorities for the country. In addition, Brazil will be hosting significant events like the COP30, scheduled for 2025, along with the Clean Energy Ministerial and the Mission Innovation, which will further enhance its position as a hub for green hydrogen and sustainable energy solutions. The time is ripe for Brazil to make a bold and assertive impact in the sustainable energy sector, and it looks set to do so.

The compatibility between hydrogen-powered vehicles and electric motorization exists and is yet another opportunity for the segment. The Vice-President of the Brazilian Sustainable Mobility Institute - IBMS in Portuguese - Carolina Saldanha-Ures, states that:

"In Brazil, we have one of the cleanest energy matrixes in the world, with a profusion of green vehicles for all uses. Nevertheless, hydrogen-powered vehicles and electric motorization must coexist harmoniously, presenting yet another promising opportunity for the future of sustainable mobility. With an astonishing 95% energy efficiency, one cannot ignore the power of hydrogen to steer Latin America towards a cleaner, more efficient future."

However, there is still a major internal obstacle that is holding back Brazil's further development, which is the lack of a regulatory framework for the segment. For instance, in Ceará alone, a state in northeastern Brazil, there are two large companies, Casa dos Ventos and Fortescue, waiting for this regulation to implement projects that will absorb investments of around US$ 8,2 billion[3](~R$ 40 billion). As the establishment of the regulatory framework for green hydrogen aims to help attract investment precisely by giving companies legal certainty, the process is being pushed by several legislators[4], especially through the efforts of the Special Committee on Energy Transition and Hydrogen Production of the Chamber of Deputies which had the intention to vote yesterday[5] (07/11) on the preliminary report[6]. The meeting was postponed, but all the signs are that soon we will probably see developments related to the matter.

With the regulatory framework, the trend is for opportunities in the country to increase and, thus, for the Brazilian green hydrogen market to develop quickly. Moreover, the opportunities for Brazil are not limited to the domestic market but also to transforming the country into one of the global suppliers of green hydrogen, as several countries and entities are setting strict targets on the need to make their energetic matrix greener[7] and will have to rely on imports.

In that sense, despite some obstacles, the general scenario points out the potential for Brazil to become one of the leaders in the segment on a global level. We should follow closely the next developments in this promising market.

Would you like to explore the immense potential of green hydrogen in the evolving global energy landscape? Sidera can help by providing guidance on market entry, investment opportunities, matchmaking, and regulatory and compliance support. Send us a line:

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