The recent approval of Low-Carbon Hydrogen Development Program (PHBC), sanctioned by President Luiz Inácio Lula da Silva and Vice-President Geraldo Alckmin, marks a pivotal step in Brazil ‘s energy transition and global leadership in the low-carbon economy. This initiative underscores Brazil’s commitment to reducing carbon emissions through the production and use of green hydrogen in Brazil, a clean energy source derived from renewable resources such as wind, solar, and biomass.
Green Hydrogen as a Game Changer for Brazil
Green hydrogen, produced with minimal carbon emissions, offers Brazil a unique opportunity to leverage its abundant renewable resources. As Secretary of Green Economy, Decarbonization, and Bioindustries Rodrigo Rollemberg noted, the PHBC positions Brazil to become a global leader in the low-carbon economy. With credits of R$ 18.3 billion set for distribution between 2028 and 2032, the program will finance a major shift towards renewable energy, fostering the use of green hydrogen across multiple industries.
Key Objectives of the PHBC
The program sets ambitious goals, including developing Brazil’s internal market for green hydrogen and supporting industries that are traditionally challenging to decarbonize, such as steel, cement, chemicals, petrochemicals, and fertilizers. Another focus is integrating green hydrogen into heavy transportation, significantly reducing the sector’s carbon footprint.
Additionally, the program promotes the densification of value chains, encouraging companies that reduce their carbon footprint to qualify for incentives. This move not only supports decarbonization but also strengthens Brazil’s industrial base by fostering technological advancements and regional development.
Economic and Environmental Impact
One of the most significant aspects of the PHBC is its ability to drive economic growth while addressing climate change. Companies eligible for tax credits under the program must meet several criteria, including contributing to regional development, advancing climate change mitigation measures, promoting technological innovation, and diversifying Brazil’s industrial sector.
These incentives will attract investment, stimulate innovation, and ensure that Brazil remains competitive on the global stage as the world transitions towards greener energy sources.
Conclusion
The PHBC is a groundbreaking program that aligns Brazil with global efforts to combat climate change while positioning the country as a leader in green hydrogen technology. With the support of significant financial incentives, Brazil is set to strengthen its domestic industrial sector, reduce carbon emissions, and contribute to a sustainable global economy.