Renewable energies and the oil companies in brazil: a study of energy transition and policy mixes.

Abstract

Oil and gas companies have been reinventing themselves, preparing for a future where their old business model will not fit. Companies like Shell, Equinor, Total, and bp have all included renewables in their portfolios in the past few years. This kind of market change is motivated and very dependent on appropriate public policies, like feed-in tariffs and subsidies, which can influence the speed and the direction of an energy transition toward renewables. While most studies about the adoption of renewables by oil companies are from developed countries, the authors have found very few publications about this theme in Brazil, especially involving public policies. Studies for developed countries usually consider an energy transition to reduce oil and gas activity and increase renewables and electrification, but this strategy may not suit Brazil. Brazil already has a large share of renewables in its energy matrix, it has serious social issues, and most of its GHG emissions come from forestry and land-use change. As such, research on the specific case of Brazil is needed. This work aims to understand how public policies in Brazil favor or hinder the adoption of renewables by oil companies and the reduction of efforts in the exploration and production of oil and gas. Through documentary research and interviews of oil and gas professionals, this article analyses the activity and plans of the seven larger oilproducing companies in Brazil and how the public policies influence these companies toward a transition to renewables and a reduction in the oil and gas activity. We analyze the Brazilian energy public policies according to the policy mix conceptual framework proposed by Rogge and Reichardt (2016). As a result, the authors show that though some oil companies in Brazil have made significant renewables investments, their current focus will still be oil and gas in the following years. The authors show the main existing barriers for these companies to adopt renewables. They also make recommendations for Brazil’s energy policy mix to facilitate and boost a transition towards low-carbon energy system.