Domestic natural gas will need to be redirected from power generation towards industries, according to a report on possible routes to reach net neutrality in Brazil by 2050.
Brazil would still need to increase its natural gas power generation, but gas production would mostly be directed to industrial uses in all scenarios. Government energy research agency Epe collaborated with the InterAmerican Development Bank (IDB) and others to publish a study titled Carbon Neutrality by 2050: Scenarios for an Efficient Transition in Brazil. It considered three scenarios towards neutrality with different degrees of worldwide collaboration and technology use.
Natural gas would still play a part in power generation until 2030, with increases in the decade paving the way for the transition toward an increase in renewable sources. But the study indicates that industries will be the leading natural gas consumer in 2050.
Brazilian power generation would expand through renewable sources, especially solar and wind, surpassing 90pc of renewable installed capacity by 2050 in all three scenarios. Brazil would also need to add 40GW in off-grid solar generation capacity in all scenarios.
Natural gas usage will need to increase in the next 30-40 years because it is an important development mechanism, power consultancy PSR's chief executive Luiz Augusto Barroso said during a presentation with the association of energy-intensive industries Abrace. Natural gas makes economic and environmental sense in Brazil for industries and transportation, but only for a few instances in the electricity sector, he added.
The recommended expansion is in line with recent trends in Brazil. It increased its installed power generation capacity by 8.2GW in 2022, with more than 83pc coming from renewable sources. Brazil also added 7.8GW in off-grid generation.
The study also points to processing biogas into biomethane as a key to reaching climate goals, which would probably decrease biogas' use to generate power and increase its use by industries, in a similar fashion to the natural gas sector. The study estimates biomethane production will reach 17mn-18mn m³/d by 2050 in all scenarios.
The household and service segment will be responsible for significant increases in electricity demand, coming close to doubling. Electricity is already one of the main sources of energy for this sector but the increase in purchasing power of a growing middle class will drive the expansion. The energy transition challenge in this segment will be to balance the growth in demand with sustainability, according to the study.
The report recommends creating and perfecting legal, institutional and regulatory frameworks to promote the development of less intensive carbon and greenhouse gas (GHG) power sources. In the electricity sector, a framework allowing low-voltage consumers to choose their power providers would give smaller consumers the chance to opt for renewable sources.
