This month’s interview: William Wills

Zero emissions from the electricity sector in Brazil would have negligible impact on GDP

Coordinator of the study What does it cost to have zero emissions from electricity generation in Brazil by 2050? launched this month by the Escolhas Institute, the electrical engineer William Wills asserts that having an electricity matrix free from greenhouse gas emissions would have no significant impact on GDP or the income of Brazilian families.

Holding a post-doctoral position in COPPE/UFRJ’s Energy Planning Program and a partner-director at EOS, a consulting firm specializing in energy and climate change, Wills views the outcome of the study as being good news, given Brazils commitment to zero emissions by end of the century, and this includes the electricity sector. Accordingly, investments for this should be planned well in advance. Furthermore, the Escolhas study will show that the transition to a zero-carbon electricity sector in Brazil by 2050 would play an important role in reducing emissions from the energy sector.

In conducting the study, Escolhas first sought to understand how the Brazilian economy and, in particular, industry will behave in the long term, in a scenario of optimistic growth for Brazil and in a more pessimistic one, and how this can affect the structure of energy demand. It also considered energy security in the electricity network, which includes issues related to the variability of energy sources and the influence of climate change.

The scenarios presented in the study were constructed from the IMACLIM-R BR, a dynamic general equilibrium model, specifically designed to evaluate the impacts of climate policies on the Brazilian economy, developed by Wills for his thesis while working at CIRED/França between 2010 and 2011.

Escolhas Institute – What are the main objectives of this study?

William Wills – The study was designed with two main objectives. The first was to calculate the cost to society and to the Brazilian economy (GDP, trade balance, employment, family income, energy consumption) of a zero-emission electricity matrix. We want to provide society with information that shows if it is possible for Brazil to have this clean matrix at low cost, since we have a debate between government and NGOs about the costs and feasibility of this proposal. Knowing the costs, society can decide what it wants. The other objective is to understand, in the macroeconomic context and considering the crisis of last year, the role of Brazilian industry and its impact on energy demand in scenarios for both optimistic and pessimistic development. If there is sizable industrial growth, we might need more supplied energy.

Escolhas – What were the results of the study? Is it possible to zero emissions from electricity generation by 2050?

Wills – The bottom line is, yes, it would be possible. It would cost a little more in sectoral terms, as it would require more investments in the electricity sector, which would also affect the cost of energy for society. Nevertheless, this impact is not very relevant; it is negligible in statistical terms, both for GDP and household income.

Escolhas – We know that emissions from the electricity sector are not Brazil’s biggest problem in terms of greenhouse gas emissions. Why, then, is there a need for this investment in zero emissions for the industry?

Wills – The carbon content of electricity in Brazil is among the lowest in the world, since most of the matrix is derived from renewable sources, mainly hydroelectric. There are other sectors where it would be possible to reduce emissions at lower costs, but Brazil undertook, in the Paris Agreement, to reduce its emissions to zero by the end of this century, which includes the electricity sector. Investments in this area, however, are long-term and a plant’s productive life is counted in decades. Therefore, ideally, the sooner the country can direct investments to renewable sources, the better.

Escolhas – What are the main clean energy sources that Brazil should be pursuing?

Wills – In addition to hydroelectric, which, in itself, is controversial, there are three main types in Brazil: wind, which has seen rapid growth and has an even greater potential; solar, both the distributed (produced in situ – home, commercial, etc.) and centralized (plants dedicated to this); and biomass, which has importance in Brazil in integrated electricity generation with the production of other biofuels – such as in the case of ethanol, where sugarcane bagasse is used to produce electricity.

Escolhas – The study considers energy security in the scenarios presented. What is this and why is it important?

Wills – Energy security is ensuring that, in the future, you will be able to generate enough electricity to meet the national demand at any time, even in a hot and dry year, on cloudy days with no wind. In this study, the Energy Research Company (EPE) helped us calculate the supplementary power, that is, how much more installed capacity is needed to ensure energy security in all scenarios.