Clean Energy RD&D investments
The increase in phase one
Brazil has increased funding of clean energy from its baseline of BRL 1,109 billion per year to BRL1,444 in year four. These figures relate only to the three main programs, two of them being linked to the Ministry of Mines and Energy, through regulating agencies. Most importantly, the observed decrease in spending in year four, due to the COVID-19 pandemic, was not as steep as could have been expected, mainly due to the domestic legal framework that ensures public-oriented investments will be made according to a percentage of the sector´s companies´ revenue.
Brazil has national policies and governance to support public and publicly oriented RDD investments in energy technologies, with a comprehensive coverage and strong component of private sector participation. These policies include legal framework that mandates public-oriented investments in R&D energy projects according to sectoral companies´ revenue. These policies explain Brazil’s engagement and success in phase one of Mission Innovation, including the investment numbers reported annually, whose level of increase is equal to many developing countries.
R&D public-oriented investment is expected to grow in tandem with the energy sector´s recovery and expansion. Brazil works with three different growth scenarios in the 2030 Decennial Expansion Plan (PDE 2030). Considering the reference scenario, Brazil´s power sector is expected to grow 43% until 2030, with an equivalent investment increase in the power sector program, responsible for almost 70% of the investment reported to Mission Innovation in phase 1.
It should be noted that Brazil has implemented concrete actions and partnerships to improve RDD investment tracking and assessment of gaps in terms of clean energy technologies. The Energy Big Push project, implemented in 2019 and 2020, in partnership with UN-ECLAC and support of the IEA, delivered very positive results in terms of providing a detailed picture of the destination of public and public-oriented clean energy investments in Brazil. There is work in progress to provide useful indicators for guiding clean energy RDD investments and policies and increase transparency and data accessibility.
In order to ensure the success and continuity of these efforts, a solid legal framework must be provided. This is why the Ministry of Mines and Energy and the Ministry of Science, Technology and Innovation signed in, Dec/2019, a joint resolution to engage in strengthening the governance of energy RDD.
In December 2020, the National Energy Plan 2050 highlighted the relevance of clean energy innovation in the context of the national long-term energy strategy, and provided guidelinesfor accelerating innovation in the context of the energy transition.
In February 2021, the National Council for Energy Policy, a ministerial-level body constituted by eight state ministers that provides domestic guidelines for the energy sector, approved a resolution defining priority areas for RDD public and publicly oriented investments, with a clear focus on clean energy solutions: (i) hydrogen, (ii) nuclear energy, (iii) biofuels, (iv) energy storage, (v) sustainable thermal generation, (vi) digital transformation, and (vii) strategic minerals.