Brazil

Brazil as a Laboratory for the Energy Transition

From hydropower to wind and solar, Brazil’s natural resources put the country at the forefront of the global energy transition, says political scientist Eduardo Viola.

Brazil | August 31, 2026

This article was written for “The Long View” section of Swissnex’s nature-focused newsletter Canopy.

The energy transition has changed character since the war in Ukraine, says Eduardo Viola, professor of international relations at Fundação Getulio Vargas (FGV) and Senior Research Fellow at the Institute of Advanced Studies of the University of São Paulo (USP). “In 2019, it was thought that it implied the replacement of fossil fuels with low-carbon energy,” says the expert on climate and energy politics. “In fact, until now, what is occurring is the addition of alternative sources without the replacement of fossil fuels, although renewables are growing faster.”

Brazil illustrates that ambivalence, Viola says, being at once “an actor of the fossilization of the world and also an actor of the transition to a low-carbon matrix.” The country, he notes, continues expanding renewable power and fossil fuels “fundamentally for export.”

According to the Energy Research Office of Brazil’s Ministry of Mines and Energy, in 2025 the country’s energy matrix was 49.4% renewable, and its electricity matrix reached 86.6%, versus just 14.5% in the global average. Moreover, Viola stresses, the Brazilian matrix is of medium carbon intensity, while most of the world is of high carbon intensity. Of all G20 countries, “Brazil is the cleanest.”

This diversification traces back to the 2001 electricity crisis, when major rationing exposed the country’s dependence on a single renewable source: hydropower. A 2002 incentive program opened the door to wind and solar, which jumped from about 1% to more than 25%, though generation has concentrated mostly in the Northeast, far from the industrial Southeast, forcing curtailment for lack of transmission capacity. For the researcher, “what is missing is being able to transmit the energy efficiently and securely from the Northeast to the South.”

This December, Brazil will hold its first auction for Battery Energy Storage Systems (BESS). More than six thousand companies have already registered. For Eduardo Viola, this redirection of capital flows is explained in large part by the low geopolitical risk of Brazil and South America, compared with conflict zones such as the Middle East and Ukraine.

Green hydrogen production follows the same logic. The Brazilian Association of the Green Hydrogen Industry (ABIHV) counts 13 projects with investment decisions through 2030, totaling more than USD 10 billion, with Europe as the main export market. But Viola, who has followed the Brazilian economy since the 1980s, is wary of inflated expectations. “There was talk of billions of carbon credits that Brazil would sell. Large markets are important, but it is the small ones, like Switzerland and South Korea, that have business potential,” the researcher concludes, pointing to economies where climate awareness, energy needs, and regulatory stability can create opportunities for Brazil.