Brazil has been progressively advancing its regulatory framework to promote the production and utilization of biogas and biomethane, aiming to decarbonize its energy matrix and attract foreign investments.
Regulatory Framework
In October 2024, Brazil enacted the “Fuel of the Future” Law (Law No. 14,993/2024), a significant milestone for the biofuels sector. This legislation established the National Program to Decarbonize Natural Gas Producers and Importers and to Encourage Biomethane. The program’s objectives include stimulating the production and consumption of biomethane and biogas, promoting projects across the production chain, and encouraging the adoption of methane-powered vehicles. Notably, the law mandates that by 2034, 10% of the natural gas sold in Brazil must be composed of biomethane, with a gradual increase starting at 1% in 2026.
Additionally, the RenovaBio National Biofuels Policy, effective since 2020, focuses on decarbonization by certifying biofuels that demonstrate greenhouse gas reductions and facilitating the trade of biofuel decarbonization credits.
Market Potential and Projects
Brazil’s vast agricultural activities, particularly its position as the world’s largest sugarcane producer, provide substantial feedstock for biogas and biomethane production. Studies indicate that Brazil has the potential to produce up to 82 billion cubic meters of biogas annually, representing about 70% of the country’s current electricity demand.
Recent initiatives underscore the market’s growth. In 2024, Raízen-Geo Biogas inaugurated a 130,370 m³/d biomethane plant in Piracicaba, São Paulo. Similarly, Essencis added a 67,200 m³/d plant in Caieiras, São Paulo. These developments increased Brazil’s biomethane production capacity by 73.5%, with São Paulo state accounting for 54% of national production.
International collaborations are also emerging. In early 2025, Toyota Tsusho Corporation, in partnership with Ferrari Agroindústria S.A., Toho Gas Co., Ltd., and Sebigas Cótica Bioenergia LTDA, initiated a pilot project to produce biomethane from sugarcane waste in São Paulo, aiming to commence operations in 2026.
Biomethane Initiatives and Outlook
The Brazilian government has implemented measures to encourage biomethane production and use. In March 2022, new policies were introduced to promote biomethane as a renewable and sustainable energy source, contributing to greenhouse gas emission reductions and energy security.
The biomethane market is poised for significant growth. The Brazilian Biogas Association (ABiogás) projects the production of 2.2 billion m³/day of biomethane by 2027, primarily from new biogas plants. Public policies such as Zero Methane and Fuel for the Future are expected to further boost the production chain for this biofuel.
Opportunities for Foreign Investors
Brazil’s evolving regulatory environment and abundant feedstock present lucrative opportunities for foreign investors in the biogas and biomethane sectors. The government’s commitment to decarbonization and sustainable energy solutions creates a favorable landscape for investments in production facilities, technology development, and infrastructure projects.
How Heavybrains Can Assist You
At Heavybrains, we specialize in providing expert advisory services to foreign investors seeking to navigate Brazil’s biogas and biomethane markets. Our comprehensive offerings include:
- Business Strategy Development: Crafting tailored strategies that align with Brazil’s regulatory framework and market dynamics.
- Valuation Services: Accurately assessing the value of potential investments to inform decision-making.
- Market Risk Analysis: Identifying and mitigating risks associated with market entry and operations.
With our in-depth understanding of Brazil’s energy sector and regulatory landscape, Heavybrains is your trusted partner in capitalizing on the burgeoning opportunities within the biogas and biomethane industries. Click here to learn more about our solutions.
References
- World Biogas Association. “Brazil Advances with a New Regulatory Framework for Biofuels.” Available at: https://www.worldbiogasassociation.org/brazil-advances-with-a-new-regulatory-framework-for-biofuels
- Global Methane Initiative. “Brazil – Biogas and Biomethane.” Available at: https://globalmethane.org/challenge/abiogas.html
- GNPW Group. “Biogas and Biomethane Represent a Great Energy Potential for Brazilian Agribusiness.” Available at: https://www.gnpw.com.br/en/biogas/biogas-and-biomethane-represent-a-great-energy-potential-for-brazilian-agribusiness
- Argus Media. “Brazil Biomethane Production Rises and Widens.” Available at: https://www.argusmedia.com/en/news-and-insights/latest-market-news/2625031-brazil-biomethane-production-rises-and-widens
- Toyota Tsusho Corporation. “Toyota Tsusho and Partners Start Feasibility Study for Biomethane Production in Brazil.” Available at: https://www.toyota-tsusho.com/english/press/detail/250207_006529.html
- Government of Brazil. “The Brazilian Government Encourages the Production and Sustainable Use of Biomethane.” Available at: https://www.gov.br/en/government-of-brazil/latest-news/2022/the-brazilian-government-encourages-the-production-and-sustainable-use-of-biomethane
- BiogasWorld. “The Brazilian Biomethane Industry: Challenges and Opportunities.” Available at: https://biogasworld.com/news/the-brazilian-biomethane-industry-challenges-and-opportunities
- Reuters. “Brazil’s JBS Supplies Animal Waste for Production of Sustainable Aviation Fuel.” Available at: https://www.reuters.com/markets/commodities/brazils-jbs-supplies-animal-waste-production-sustainable-aviation-fuel-2024-07-22
