Carbon credits shift income from consumer to producer, critics say

With just over two years of trading on B3, the fuel sector’s carbon credits program has become the subject of questioning, both because of the soaring prices in recent months and because of its efficiency from an environmental point of view.

The fuel sector and experts are calling for changes to the program, which they accuse of shifting consumer income to biofuel producers. Ethanol producers say the initiative is coming under attack from companies that are against the program.

Called Cbios, the credits reached record levels at the end of June, prompting the government to relax the deadline for meeting acquisition targets to reduce pressure on fuel prices.

The decision halved the quotations, but experts claim that it only pushes the problem to the following years, when Cbio may even be lacking to meet the mandatory purchase targets by distributors.

Fuel distributors are required to buy Cbios to offset the emission of pollutants in the consumption of products. The objective is to transfer resources from the sale of fossil fuels to the production of renewable energy, reducing its cost and encouraging consumption.

Each Cbio is equivalent to the emission of one ton of carbon into the atmosphere. The goals of each distributor are calculated according to the volume of fossil fuels that each one puts on the market. In 2022, they will have to buy around 36 million bonds.

The value of Cbios is embedded in the prices of gasoline and diesel, which led the government to relax the targets and ask CADE (Administrative Council for Economic Defense) to investigate possible abuse of market power.

Author of a study on the Renovabio program, which created the Cbios, PUC-Rio professor Márcio Thomé says that the problems reflect flaws in the program’s elaboration, such as the lack of inspection by financial market bodies, such as B3 itself and the CVM (Securities Commission).

“In September 2021, for example, we had a very high purchase in a single day, which dried up the market and pushed prices up. These atypical purchases need to be monitored”, he says, noting that the three large Brazilian distributors account for 70 % of targets.

He also cites the impossibility of using other carbon credits to offset emissions and the focus on the fuel distribution sector, without the active participation of oil producing companies or refineries.

The idea, he says, is to bring to the market a greater variety of participants, new fuels and other renewable energy sources to improve competition and encourage research and development of less polluting fuels and energies.

Author of a book about the program, lawyer Patrizia Tömasi-Benzik accuses the program of creating a market reserve for sugarcane producers, noting that the law that created Renovabio was proposed by the current president of Unica (Union of the Sugar Cane Industry), Evandro Gussi.

She also argues that the credits do not meet the requirements of the UN (United Nations), as they do not guarantee the removal of carbon from the atmosphere.

“What the program actually does is force the sector to buy false credit, which is registered by two banks and is being traded exclusively on a stock exchange”, he says.

The criticisms are seen as unjustified by the biofuel producers and they try to reverse the flexibilization of meeting the targets with the government. “It was a very wrong solution. It seems to me illegal, unconstitutional”, says the president of Unica.

He claims that it was based on the bill that created a state of emergency to justify granting aid in an election year, but with limitations on additional measures. “The MME [Ministério de Minas e Energia} está querendo transformar o estado de emergência em um cheque em branco.”

Gussi diz que o programa precisa de aprimoramentos e defende maior fiscalização pelo mercado financeiro e a criação de contratos de longo prazo para os Cbios, mas defende que o sistema incentiva investimentos em eficiência energética pelas usinas produtoras.

Ele argumenta que 135 empresas já recertificaram ou solicitaram a recertificação antes do prazo normal para conseguir ampliar o volume de Cbios emitidos com base em ganhos de eficiência desde que aderiram ao programa.

“Dizer que não gera busca por eficiência é ignorância ou má-fé”, afirma. “A usina que for mais eficiente vai ter mais Cbio pelo mesmo volume de etanol.”

Sobre a acusação de manipulação com Cbios, a Unica diz que hoje há poucos títulos já emitidos em mãos dos emissores. Segundo a ANP (Agência Nacional do Petróleo, Gás e Biocombustíveis), são cerca de 9% do total.

Dentro do setor de cana-de-açúcar, há outra disputa envolvendo o programa. Os plantadores de cana apoiam projeto de lei que lhes daria 80% do valor dos Cbios, hoje em discussão na Câmara dos Deputados.

Segundo a Orplana (Organização das Associações dos Produtores de Cana), cerca de 30% da matéria prima é plantada por produtores independentes. “A grande batalha nossa é para remunerar o produtor e não deixar que o programa acabe”.