Decree regulates carbon market in Brazil

The Brazilian government today (May 20) published a decree with rules for the low carbon market in the country. The piece of legislation outlines procedures for plans to mitigate climate change across a number of sectors of the economy, and also introduces the National System for the Reduction of Greenhouse Gas Emissions. The measure meets a requirement set by environmental law.

In effect since 2009, the legislation that established the National Policy on Climate Change stipulates that the government is tasked with issuing a norm with procedures for sectoral plans “aiming at the consolidation of a low carbon economy,” in order to meet gradual targets in the reduction of greenhouse gas emissions.

This policy must be applied considering the specificity of each sector in the generation and distribution of electricity, urban public transport, and interstate cargo and passenger transportation systems.

Besides these sectors, the rules must also be enforced in the industries of manufacturing, consumer durables, basic and fine chemistry, paper and cellulose, mining, construction, as well as health services and farming.

Gas emissions

According to the decree, the ministries of the Environment and the Economy will be in charge of proposing these plans with gradual reduction goals that may be measured and verified.

The sectors listed will be given a period of 180 days, as of the publication of the decree, to bring forth “proposals for the establishment of curves for the reduction of greenhouse gas emissions, considering the long-term goal of climate neutrality.” The deadline may be extended for an equal period.

Furthermore, plans should be approved by an inter-ministerial committee on climate change and green growth.

The National System for Greenhouse Gas Emissions Reduction (SINARE), in turn, aims to be a “single central registry of emissions, removals, reductions, and compensation of greenhouse gases and of acts of trade, transfers, transactions, and retirement of certified reduction credits,” which, according to the decree, should include tools for integration with the regulated market internationally.

The two ministries will also be responsible for devising rules governing registration, certification standards, accreditation of certifiers and custody centers, as well as the implementation, operation, and management of SINARE.