Business for climate platform: lessons learned from an emissions trading system simulation in Brazil: a corporate view and proposals
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The Center for Sustainability Studies (FGVces) of the School of Business Administration at Getulio Vargas Foundation (FGV-EAESP) has, since 2013, simulated an Emissions Trading System with Brazilian companies, called the EPC ETS. This market simulation is part of the Businesses for Climate Platorm (EPC), an initiative which intents to raise awareness for and engage business leaders about the management and reduction of greenhouse gas emissions and climate related risks, as well as proposing public policies for a low carbon economy. EPC ETS aims to engage Brazilian companies in the debate and promote learning about suitable approaches for a comprehensive carbon market in Brazil, as well as cocreating, with the companies, clear proposals for the government about a possible market in the country, highlighting businesses perceptions and proposals (on the matter). The proposals contained here intend to support government decisions in case an emissions trading system gets adopted. As such, no assessments are offered on the relevance or applicability of an ETS in Brazil, or any other pricing mechanisms. Only general and structural recommendaAons for a market are made, with the purpose of helping to design such an instrument, should an ETS be established in the country. The Proposals for an Emissions Trading System in Brazil were formulated based on the knowledge acquired by member companies throughout EPC ETS' building and implemenAng processes in 2013, and during its three years of operaAon (2014-2016). They were also based on existing ETSs, such as California’s Cap and Trade Program and the European Union Emissions Trading System (EU ETS). Additionally, previous studies carried out by GVces for Brazil's Ministry of Finance represented fundamental stepping stones for an initial understanding of the technical features of an emissions trading system. The Proposals presented in this document were built in conjunction with EPC ETS member companies, who shared not only their learnings from three years of participation in the market simulaAon, but also their views and perceptions on the subject. It is of great importance that government initiatives on carbon pricing are shared with society from their conception, so that the adopted mechanism might have wide acceptance and counts on the commitment of the actors involved.