Erasmo Carlos Battistella calls for guarantee of predictability, industrial policy, to announce investments

01/27/2023

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Erasmo Carlos Battistella — Foto: Claudio Belli/Valor

Erasmo Carlos Battistella, the country’s top biodiesel businessman, is hoping that the government will soon set up its technical team, mainly in the Ministry of Mines and Energy (MME), to present the request to increase the biodiesel blend in diesel from the current 10% (B10) to 15% (B15) from March. The Bolsonaro administration’s decision to introduce B10 is only valid until the end of February, and by then the Lula administration will have to make a decision about the blend.

According to the schedule of the National Program for the Production and Use of Biodiesel (PNPB), B15 should be commercialized as of March this year. However, the previous administration already failed to meet the plan’s schedule by reducing the blend to 10% last year, when it should have been 14%.

The decision froze new investments in the area, including a R$2 billion package by Mr. Battistella’s BSBIOS. According to him, if the new administration resumes the original blending plan, the company can resume its investment plan.

“If B15 returns, BSBIOS will announce new investments in Brazil. Meanwhile, we are making other [investments] abroad,” he said. On the international front, the company’s latest move was to acquire the La Paloma soybean crushing and biodiesel production complex in Paraguay earlier this month.

“We have not [invested in Brazil], but we have not stopped projects. We are working on the engineering part, on the environmental licensing and the projects are ready. What we need is B15, the guarantee of predictability and the existence of an industrial policy,” said Mr. Battistella.

However, he defended that the creation of the government’s technical team should be accelerated. “We are already at the end of January and there are other sectors like us that need to talk to the government,” he said. “We have a dialogue [with the new administration], but we have not yet managed to set up formal meetings as a sector,” he said.

Businesspeople and representatives of the sector are also planning to present the government’s technical team with a plan to review the deadlines for meeting the National Policy for Biofuels (RenovaBio) targets. The last administration extended the deadline for meeting the 2022 target to September this year and said that from 2023 the deadline could be met by March of the following year. The measure caused the price of Decarbonization Credits (CBio) to fall and clouded the long-term scenario of the program.

For the businessman, the Brazilian government needs to move forward with biofuel regulation to close the country’s gap in this area and advance the decarbonization agenda. “Brazil is ten years behind the U.S. in terms of biofuels: we have no regulation for the use of green diesel, we have no regulation for the use of aviation biokerosene (SAF), and we are stuck at B10, while in the U.S. the floor [of the blend] is B20,” criticized the Mr. Battistella, who is attending an international conference on biofuels organized by the Clean Fuels Alliance America.

For him, the zero deforestation policy alone is not enough. “It needs to reduce emissions in land, maritime, and air transport.”

The biofuel leader praised the re-creation of the Ministry of Development, Industry and Trade (Mdic), which is expected to create lines of credit to support industrialization with reduced rates. “Today we have an interest rate that hinders investments not only in industry but in all sectors,” said Mr. Battistella.

In turn, the likely return of Petrobras’ protagonism in areas other than oil and gas, such as in biofuels, is being closely watched by Mr. Battistella, a former partner of the state-owned company in BSBIOS. “I hope it will come back to the [biofuels] sector with the great strength it has, but aligned with the production sector, to add and not to divide. If it is to add, it will be a great reinforcement. If it is to divide, it will be bad. But I expect that it will add”, he said.

*By Camila Souza Ramos — São Paulo

Source: Valor International

https://valorinternational.globo.com/