Sergio Massilon, the institutional director of Brazil's federation of fuel distributors Brasilcom, told Argus the Cbio carbon credits market needs more predictability, stability, governance and transparency to ensure the effectiveness of decarbonization targets.
How does Brasilcom view the legal challenges to the Renovabio biofuels policy framework?
Brasilcom is closely monitoring Renovabio legal actions, including cases in the federal superior court. The injunctions granted to distributors reflect legitimate concerns about the program's implementation — especially over target predictability, Cbio pricing logic and regulatory asymmetry.
While the mines and energy ministry's efforts to overturn these injunctions are expected, they highlight the need for a broader technical and regulatory debate, with active participation from the regulated sector.
What is Brasilcom's view on the federal court of auditor's (TCU) actions?
Brasilcom is paying close attention to the TCU's actions, which is evaluating complaints about possible illegalities in the management, transparency and control of resources and operations involving Cbio sales. Since TCU has ordered an audit of Renovabio to verify whether the current Cbio trading structure affects achievement of the program's decarbonization targets, the conclusions of this audit could be key to much-needed modernization.
We believe that external oversight should enhance public policy. Some of TCU's concerns — such as price volatility, competitive imbalances, and lack of transparency in target-setting — mirror those raised by the sector.
If injunctions are overturned and distributors required to purchase Cbios again, what should be done to ensure their smooth return?
If judicial decisions are reversed and the obligation to purchase Cbios is immediately reinstated for all distributors, it is essential this occurs with predictability, fairness and open dialogue with the market.
Some measures we consider necessary to ensure an orderly reintegration include a phased transition to avoid price shocks: proportional target adjustments that consider the suspension period; clearer, more transparent criteria from regulators; and flexibility tools such as strategic reserves or a multi-year target bank to manage market disruptions.
