The publication of that first goal, in 2018, was an important milestone in the recent history of the program, at a time when other very important instruments and mechanisms were still being discussed and built that, together, would allow RenovaBio to achieve its objectives:

• Contribute to meeting the country's commitments under the Paris Agreement;
• Contribute to an adequate relationship of energy efficiency and reduction of greenhouse gas emissions, taking into account life cycle assessment mechanisms;
• Promote adequate expansion of the production and use of biofuels in the national energy matrix, with an emphasis on regular fuel supply;
• Contribute with predictability to the competitive participation of various biofuels in the national fuel market.

And how important are these goals?

The goals are defined for a period of 10 years, thus aiming to bring the element of predictability, which helps private agents to carry out their investment planning and analysis in an environment with less uncertainty. Long-term planning is essential for the country, since RenovaBio does not propose the end of fossil fuels, but rather the opening of the fuel market to renewables, based on the energy and environmental efficiency of each fuel from the perspective of the energy cycle. life, thus ensuring that those most efficient are recognized and encouraged.

Between March and April 2020, when a significant number of biofuel producing plants were already certified in RenovaBio, with their pre-CBIOs already issued, just awaiting the final adjustments of the financial mechanisms for the full operationalization of the new carbon market, Two external factors raised important discussions about RenovaBio's goals, one of a geopolitical nature (breakdown of the production control agreement between Saudi Arabia and Russia) and the other, less predictable, the COVID-19 pandemic.

These two factors, in a way, froze the commercialization of CBIOs, as the obligated parties (distributors that need to meet the targets), about to start operating in this market, claimed the need to revisit the pre-established mechanisms relating to their participation in the program.

One of the distributors' requests resulted in the current goal review process, which was already foreseen in the policy if necessary, which was completed by the Ministry of Mines and Energy (MME) and made available for public consultation, on June 5, 2020, exactly two years later.

It is true that the account of this new carbon market “does not close”, when challenging factors occur even before the market is established, such as: low oil prices, a drop in domestic consumption of biofuels, among others. Such factors directly interfere with ensuring the commercialization of biofuels in sufficient volume to generate the quantity of CBIOs necessary to meet the target.

The economic model used to define the goals is quite robust and will certainly bring scenario analyzes and simulations that will support new goals considering the different possible boundary conditions (macroeconomic variables, market characteristics, fuel supply and demand, prices, among others). .

The challenge, faced with this scenario of global uncertainty, and especially in the Brazilian context, to which there is added crisis and instability in the political sphere, is to determine such boundary conditions that result in projections that induce the reestablishment of balance and that at the same time guarantee that this new carbon market takes off and consolidates in the short term and guarantees the predictability necessary to meet long-term objectives.

On this Environment Day, for everyone who was involved in some way in the history of construction and consolidation of the RenovaBio program, it is worth reflecting on how to keep the essence of the program alive, based on the recognition of the positive externalities of biofuels and their role in promoting of innovation with encouragement for continued improvement in energy and environmental efficiency of the value chains involved.

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