Comerc Energia betting on Brazil’s carbon credit market

Brazil’s Comerc Energia is betting on the growth of the carbon credit market. 

On Tuesday, the renewable energy and energy transition partner of Vibra Energia launched a platform to commercialize carbon credits and I-RECs (renewable energy certificates) generated by sustainable projects. 

Besides trading, Comerc will assist renewable energy generation companies in mapping their carbon projects, registration with international organizations, and future commercialization of the generated credits.

A carbon credit represents 1t of CO2e that is no longer emitted or captured in the atmosphere. 

The I-REC is a global system for trading renewable energy certificates using a unified methodology to ensure transparency and traceability, allowing companies to offset their CO2 emissions.

There are two types of carbon market: voluntary and regulated. In the voluntary market, in force in Brazil, companies acquire carbon credits spontaneously, motivated by reputational or strategic reasons to meet sustainable goals. 

The regulated market, responsible for most of the global transactions, is divided into cap and trade, in which the government establishes emission targets to be offset by sectors of the economy, and a carbon tax on segments of the economy. In this case, companies have to prove investments in projects pre-established by the government to reduce or zero out the taxes. 

"This market is being born in Brazil, and our expectation is that we'll see stronger growth in the coming years," Comerc's CEO André Dorf (pictured left) told a press conference.

He said it is difficult to foresee the growth rate while the carbon credit market is not regulated in the country – an issue that is currently being analyzed by congress. 

Comerc chairman Christopher Vlavianos (center) said today, companies are paying more attention to scopes 1 and 2 of the greenhouse gas control protocol, which are related to the emissions resulting from their own activities and electric power consumption. 

For most firms that adhere to the protocol, scopes 1 and 2 are already mandatory, unlike scope 3, which includes all indirect emissions not included in scope 2 that occur in the company's value chain. 

“When companies start worrying about scope 3, classifying their suppliers, this market will have a very high growth trend,” Vlavianos said. 

Thiago Natacci, Comerc’s energy and carbon commercialization director, highlighted that the carbon emissions market is very much linked to the overall economy. 

"The world is not going to be in crisis forever, and companies are going to go back to producing on a larger scale. Therefore, offsetting emissions will become more important," he said.

Ernesto Pousada (right), CEO of Vibra, which is the largest fuel distributor in Brazil, said that the country has a unique opportunity for energy transformation. 

"Public policies will be important for Brazil to have a protagonistic role in this area," he said.

Together, Vibra and Comerc plan to reach 1.8GW of centralized (large plants) renewable generation capacity in the next 12 months and 450MW of distributed generation potency by 2025.