In an interview with CNN Sustainability Guarany Osorio, FGV’s teacher of environmental policy and economy, spoke about the carbon market. When asked about Brazil’s advances, the expert stated that “compared to other countries, Brazil is the best student in the class when we talk about sustainability.”
For Guarany, the country still needs a climate schedule and an instrument package so that Brazil can completely use its potential in the carbon market, a sector that is still new in the country.
In December 2024, President Luiz Inacio Lula da Silva sanctioned the law establishing the Brazilian Greenhouse Gas Emissions Trade System (SBCE). The measure creates a regulated carbon market in the country and sets limits for the emission of greenhouse gases.
“The role of the carbon market in Brazil will be to help the country implement the targets promised by Brazil, the issuance reduction goals. This regulated market has been approved and it will have a phased implementation. So, we will take 4 to 5 years for this market to operate,” explained the professor.
Regulated market x voluntary
Within the carbon market there are two regulatory models: regulated and voluntary. Professor Guarany Osório explained the difference in an interview with CNN .
“The regulated market is a way of pricing carbon, you can price COâ‚‚ or by a tribute, or by a regulated market. The regulated is born of a law, from legislation. So it has a legal demand to enter this market,” says the professor.
Guarany Osorio also clarifies that companies that are in the regulated market are required to be within this market. “They will have a mandatory limit, if you do not meet this limit will be penalized with a fine, for example.”
On the other hand, in the voluntary market, companies buy assets when they want, according to their business strategies. “A company that has a voluntary goal in Brazil, it can use carbon credit, for example. It is important that the company has internal emission reduction actions for it to change, make technological transformations in its processes and then it uses the compensation via carbon credit in the voluntary market as a small climate strategy,” said Guarany Osório.
This content was originally published in a carbon market expert: Brazil is the best student on the CNN Brazil website.
Source: CNN Brasil
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