Brazilian state-owned petroleum firm Petrobras will drive the country’s transition to renewable energy, as its new CEO, Jean Paul Prates, stated in a video to employees, as reported by Reuters on January 27. One day earlier, Prates was appointed as CEO by Brazil’s new president Luiz Inácio Lula da Silva, who is committed to protecting environmental and combating deforestation. According to Prates, the new outlook for Petrobras stem from an urgent global demand to address climate change, and the company will be a key player in Brazil’s energy transition given the size and trajectory of the company. However, he also stressed that Petrobras would maintain its presence in the oil and gas sector, while pursuing decarbonization, profitable diversification, and a fair energy transition.
Brazil has one of the cleanest energy mixes in the world, with 66% of its electricity demand in 2020 met by hydropower, 12% by fossil fuels, and 11% by wind and solar. However, deforestation in the Amazon River Basin has impacted hydropower generation. To diversify energy sources, Brazil has set a target for 2023 to expand the national power generation capacity by 10.3 gigawatts (GW) on 189GW in 2022, with over 90% of the growth coming from wind and solar. Moreover, the Brazilian government has announced plans in January to issue its first green bond in 2023. The bonds must be linked to green projects such as sustainable agriculture and energy transition.
while the size and trajectory of Petrobras means that it naturally occupies the role of major driver of Brazil’s energy transition