Brazil receives donation of 78.85 million euros for the Tropical Forests Fund at COP31

The United Nations Climate Conference (COP 31) began on November 9 in Antalya, Turkey, and will run until the 20th of this month. Over these two weeks, representatives from nearly 200 countries are gathering to discuss measures for environmental protection and combating the climate crisis. Topics of focus include global warming, fossil fuels, energy transition, and preparing populations for climate change.

Scientists, environmentalists, civil society organizations, and businesspeople participate in the conference, but official negotiations are conducted by representatives of countries who may be heads of state, ministers, diplomats, and others. The goal of these discussions is to achieve international agreements and environmental commitments by the end of COP, including setting greenhouse gas emission reduction targets. These decisions are made by consensus among governments.

Each country presents its proposals and topics it deems important for discussion, and some even organize pavilions within the event. This is the case with Brazil, which hosted COP last year and is now presenting the results and continuing the initiatives of COP 30.

President Lula is in Turkey along with ministers, deputies, and representatives of the Brazilian financial market. The main topics that Brazilians will present over the days include fossil fuels, deforestation, and climate financing. These issues will be highlighted in the Brazilian program, which includes presentations and debates in its pavilion, and will also be officially proposed in negotiations with other countries.

Special attention is paid to climate financing—a topic long discussed at COP. Essentially, this term refers to mobilizing financial resources so that countries (primarily developing ones) can meet their climate goals and implement environmental projects.

Brazil's proposal is to achieve a target of attracting no less than $1.3 trillion USD annually in climate financing for developing countries by 2035. This target was defined at COP 29 in Baku, Azerbaijan, and has two levels. The main level stipulates at least $300 billion annually until 2035, with developed countries leading this mobilization from both public and private sources. The second, broader level calls on everyone—governments, development banks, and the private sector—to work together to increase the total amount to at least $1.3 trillion per year. At COP 30 in Belém, countries decided to accelerate actions towards this amount. Thus, Brazil proposes confirming this commitment and fully expanding the financing, which has been insufficient in recent years and does not meet the needs of developing countries.

The $1.3 trillion figure refers to the total volume that should be directed annually to developing countries to finance climate measures. This volume can be used, for example, for building clean energy facilities, protecting forests, and creating structures resilient to climate phenomena.

However, when it comes to climate financing, one of the main discussions is who will provide the money and how. It is not as simple as opening a bank account and waiting for countries to deposit over a trillion dollars to transfer to developing nations. Resources can come from various sources and instruments: private investments, where companies and banks invest money in sustainable projects; government donations that do not require repayment; loans (which must be repaid later by developing countries); carbon markets, and other opportunities. Countries disagree on the weight of each source: developing countries demand more public money from wealthy nations, while the latter rely on the private sector. The Brazilian plan proposes a middle ground, combining public and private resources, without relying on a single method of fundraising.

The proposal will be discussed with other countries on November 13 during COP 31's Day of Finance and Trade. Meanwhile, the report of the Presidency of Brazil at COP 30 is already available, detailing the proposal and explaining possible resource sources. The document was published on November 8.

Titled 'Implementing the Baku to Belém Roadmap to $1.3 Trillion,' this 78-page document presents six areas that could become sources of climate financing. According to the report, these areas do not have equal weight: they were chosen as primary funding channels identified during the Baku to Belém Roadmap process, not based on their size. The document explains: 'The six assessment areas correspond to the main channels and instruments identified within the Baku to Belém Roadmap process, not their current or potential magnitude. Therefore, they do not possess comparable scale or maturity and should not be interpreted as six equivalent pillars.'

The idea is that by expanding the resources in these areas, the trillion-dollar sum can be reached. According to the report, without changes, international climate financing will reach only between $458 and $461 billion annually by 2035; with the proposed measures, it could amount to between $1.27 trillion and $1.41 trillion. Another proposal is to track this financial volume using a 'climate finance action compass,' a tool jointly created with the Climate Policy Initiative organization to monitor the scale, speed, coverage, and impact of resources.

More than 70% of federal subsidies to the energy sector in Brazil last year were directed towards fossil fuels. The use of these fuels is the main cause of global warming and the increase in extreme weather events.

These findings are presented in the ninth edition of the Monitoring of Federal Subsidies for Energy Sources in Brazil, a study prepared by the Institute of Socioeconomic Research (Inesc).

Although subsidies for renewable energy sources, such as solar and wind power, remain smaller, they grew by 20.89% in 2025 alone.

According to the researchers, in 2025, Brazil spent 77.16 billion reais on federal subsidies to the energy sector. Of this amount, 70.14%, or 54.12 billion reais, was allocated to sectors such as oil, natural gas, and charcoal.

The share allocated to renewable energy producers, including transport electrification and wind and solar power generation, amounted to 23.04 billion reais. In fact, for every real allocated to these renewable sources, 2.35 reais went to fossil fuels.

According to Alessandra Cardoso, a political advisor at Inesc and co-author of the study, these figures demonstrate that Brazilian subsidy policy continues to support a strong dependence on fossil fuels, while climate urgency requires reducing greenhouse gas emissions from energy production.

"It is not just about comparing how much the country allocates to each energy source, but also about assessing what activities are stimulated, who benefits from these resources, and how these choices align with commitments to the energy transition," she emphasized.

Compared to 2024, when 73.88 billion reais were allocated to the energy sector, there was a 4.44% increase in financial support. However, the share of fossil fuels decreased by 1.27% compared to 2024, when this sector received 54.82 billion reais.

At the same time, the production and consumption of renewable energy received 20.89% more benefits than in 2024, when subsidies amounted to only 19.06 billion reais. Researchers note that the expansion of preferences for renewable sources was mainly driven by incentives for distributed generation, which accounted for 14.71 billion reais, equivalent to 63.9% of the share of renewable sources.

In this model, energy is produced by the consumer themselves, for example, by installing photovoltaic panels on their own residential or commercial building. Cassio Cardoso Carvalho, an Inesc political advisor, believes that the financing mechanisms for distributed generation effectively shift costs onto consumers who cannot benefit from self-generation, creating a risk of deepening inequality in the transition process.

"Subsidy policy must combine the expansion of clean sources with criteria of distributive justice, reduction of energy poverty, and expansion of energy access," he added.

Even despite the decrease in fossil fuel subsidies, individual analysis of the mechanisms in 2025 revealed that the Fuel Consumption Account (CCC), a fee paid by electricity consumers, collected 14.11 billion reais, which is 26.62% more than in 2024. This amount, making up just over a quarter of the subsidies allocated to fossil fuels, was used to finance electricity generation in isolated fossil fuel-based systems, such as diesel power plants.

According to Cassio Carvalho, a systematic reform of subsidies is necessary, capable of evaluating, planning, and redirecting public resources to serve as an important tool for advancing Brazil's energy transition. He concludes that some sectors no longer require this level of incentives due to factors of energy transition or economic viability.

The Ministry of Finance notes that the Inesc study reflects a trend toward reducing federal subsidies for fossil fuels and increasing resources for renewable sources. The Ministry emphasizes that the data pertains to the period before exceptional and transitional measures adopted in 2026 to mitigate the negative consequences of international oil price volatility caused by the war in Iran and the closure of the Strait of Hormuz.

The Ministry's communication also highlights legislative changes aimed at stimulating sustainable energy production, such as the Future Fuels Law (14.993/2024), which integrates the RenovaBio, Mover, Brazilian Vehicle Labeling Program (PBEV), and Vehicle Emission Control Program (Proconve). Furthermore, the Ecological Transformation Plan, EcoInvest Brasil, is mentioned, forecasting the mobilization of over 190 billion reais in investments, and the Climate Fund, which provides 27.5 billion reais for 2026. According to the ministry, this set of measures will contribute to a more balanced distribution of subsidies and the energy transition in line with the commitments of the Brazilian government.

The Brazilian presidency of the UN climate conference (COP30) released a detailed plan aimed at mobilizing $1.3 billion (equivalent to 1.17 billion euros) annually by 2035. This amount is intended to assist developing countries in facing the climate crisis.

The document, titled 'COP30 Presidency: Implementing the Baku to Belém Roadmap towards $1.3 Billion,' emphasizes that preventing the planet from exceeding the 1.5°C warming limit, as stipulated in the Paris Agreement, has moved from being merely a risk to a fundamental prerequisite for global planning.

Ambassador André Corrêa do Lago, president of COP30, warned on the eve of the start of COP 31 in Antalya, Turkey, that the currently available flow of resources is insufficient. If the situation persists, the most vulnerable nations would receive only approximately $461 billion (413 billion euros) per year, resulting in an estimated funding deficit of $840 billion (753 billion euros).

This text, presented at the conclusion of Brazil's mandate in leading UN negotiations, is advisory in nature and seeks to achieve the financial goal set the previous year during the summit held in the Amazonian city of Belém.

To determine the methods of resource acquisition, Brazil invited renowned economists, including Esther Duflo, Nicholas Stern, and Gabriel Zucman. The proposed strategy integrates public sources from developed countries, private investments, and the creation of new international taxes applied to large fortunes and fossil fuels, totaling six revenue streams.

Private capital would be responsible for the largest portion, needing to multiply by more than nine to reach $882 billion annually (790 billion euros). This would be made possible through public risk mitigation mechanisms, such as government guarantees, insurance policies, and currency fluctuation protection.

Additionally, public assistance provided by rich countries and multilateral financial institutions would need to double, reaching $384 billion (344 billion euros) annually. The plan also foresees imposing new taxes on very wealthy individuals, financial transactions, aviation, and oil, aiming to capture an additional $129 billion (115 billion euros) per year.

To ensure compliance with international commitments, the incumbent presidency suggested implementing the 'Climate Finance Action Compass.' This will be an open-access digital platform designed to monitor the destination, speed, and scope of financial transfers.

According to the document, these guidelines aim to fulfill what was agreed upon at COP29 in Azerbaijan and the consensus of the decision adopted in Belém, where the international community recognized the urgency of raising resources to $1.3 billion per year (1.17 billion euros).