By 2021, we will be directly impacted by climate change, with record temperatures, increased natural disasters and damage to biodiversity around the world.

These signs generate an urgent alert and direct the discussions and public policies around the fight against ongoing changes, especially during COP26.

In this context, ICC Brasil, in partnership with WayCarbon, LA's largest strategic consultancy exclusively focused on sustainability and climate change, developed an unprecedented study on opportunities for Brazil in the carbon markets. With the support of Suzano, Microsoft, Shell, Natura, Bayer and bp, the institutions discovered that the potential for generating revenue from carbon credits until 2030 for Brazil would be around US$493 million and US$100 billion. This would equate to 1 gigaton (1 billion tonnes of CO2 equivalent) over the next decade for the agro, forestry and energy sectors.

Today, there is an accumulated record of more than 14,500 carbon credit projects worldwide, which corresponded to the generation of almost 4 gigatonnes of tCO2 credits by 2020.

Carbon market and opportunities for Brazil 

Carbon credits are an economic instrument aimed at reducing greenhouse gases, which lead to aggravation of climate change. These credits are part of a flexibility mechanism, which helps countries or companies that have greenhouse gas emission reduction targets to achieve them more economically. For each ton reduced or not emitted of these gases, a carbon credit is generated. Thus, when a country or company manages to reduce emissions, depending on the methodologies involved, it receives a credit.

The study points out that in the next decade Brazil has the potential to meet 5% to 37.5% of the global demand in the voluntary market and 2% to 22% of the global demand in the regulated market under the UN. And even more considering the public policies in the mechanisms of art. 6th, generating $100 billion in revenue.

Given the opportunity to operate in global carbon markets and the emphasis on the agricultural, forestry and energy sectors, it is understood that there is a path to be followed by the Brazilian government and the private sector to unlock and take advantage of these income-generating opportunities, health and social well-being. The study has more than 10 essential recommendations, but there are two main steps. The first is to understand carbon markets as the potential to unlock financial opportunities for economic recovery plans and accelerate the sustainable growth of the Brazilian economy and the second is to develop robust systems for monitoring, reporting, verifying and reducing emissions that cover all sectors of the Brazilian NDC (Nationally Determined Contribution).