Biodiesel use in Brazil on the rise 20 years after legal framework
A law passed in Brazil in January 2005 established the legal framework for biodiesel in the country. Sanctioned during President Luiz Inácio Lula da Silva’s first term in office, it officially introduced renewable fuel to the country’s energy system as an alternative to fossil diesel—which is more polluting and stems from limited reserves.
The piece of legislation also created the National Agency for Oil, Natural Gas, and Biofuels (ANP), aimed at regulating the production and sale of biofuels in the country and implementing the National Program for the Production and Use of Biodiesel (PNPB).
Originally, the law established a blend of five percent of the renewable fuel in the diesel oil, creating a mixture called diesel B. During an initial transitional period of eight years, however, the minimum percentage was two percent—first on a voluntary basis, but mandatory after three years.
In 2009, the mandatory five percent blend was introduced by a resolution of the National Energy Policy Council. Since then, there has been a gradual evolution that has led to biodiesel B14 (which adds 14 percent of biodiesel to diesel B), implemented in March 2024.
In the opinion of the Minister of Mines and Energy Alexandre Silveira, the main stride in the twenty-year period was the expansion of the production and use of this type of biofuel, with a resulting boost to sustainable development in environmental, social, and economic terms. “In these two decades, we have produced 77 billion liters of biodiesel, saving 38 billion dollars in diesel imports,” he noted.
Furthermore, the increase has resulted in 240 million tons of carbon dioxide not emitted, generating jobs and opportunities for family farmers and making biodiesel “a great ally in the country’s fair and inclusive energy transition,” he went on to mention.
In 2023, biodiesel production in Brazil surpassed 7.5 billion liters, up 19 percent over the previous year, as per ANP figures.
Demand
In the same year, demand for road diesel grew by 1.7 billion liters. Of this total, 1 billion liters was supplied by the production of biodiesel used in the mandatory 12 percent blend at the time, according to the Energy Research Company (EPE).
Even though this rise is not yet able to keep up with the accelerated expansion in demand for transportation, the progress of biodiesel is stronger if added to the results of other policies such as ethanol, the National Biofuels Policy—created in 2017—and the recently approved Fuel for the Future Law. In this landscape, biofuel production in the country was expected to reach 35.4 billion liters of ethanol and 74.9 million m³ of biomethane by 2023, according to the agency.
The new law also created tools to encourage the production and use of new biofuels, such as Sustainable Aviation Fuel (SAF) and green diesel, produced from organic waste.
Diversification
The diversification of low-carbon energy sources is also a strategy to tackle the dependence on soy as a raw material for biodiesel production. According to EPE, soybean oil accounted for 69.15 percent of the raw material used in biodiesel production in 2023.
“This dependence makes society vulnerable to price fluctuations. That’s why our goal is to strengthen strategies to diversify the sources of raw materials for bioenergy, expanding the use of low-carbon alternatives such as used cooking oils and animal fats,” Minister Silveira said.
By June this year, the Ministry of Mines and Energy is expected to issue a joint ordinance with the Ministry of the Environment setting a minimum percentage for the use of this material in the production of biofuels.
The public policies, the minister argued, demonstrates the government's commitment to the expansion of biofuels in the Brazilian energy system. “Because of these advances,” he went on, “in 2024 we reached the historic mark of 9 billion liters produced—a figure that demonstrates the importance of biodiesel for Brazil.”
Development
In the minister’s view, these results also represent economic development, job creation, and social transformation, fostered by the policy created with the Social Biofuel Seal, which in 2024 underwent a review of the rules created in 2004.
With the changes, in addition to the tax and commercial benefits granted to biodiesel producers who use raw materials from family farming, funding lines were created for research projects, production chains, and family farming organizations.
