Global oil and gas company BP estimates that the new Brazilian policy regarding biofuels (RenovaBio) has improved the outlook for domestic ethanol production and should attract new investment in plants. It believes that RenovaBio will create a stable regulatory environment allowing foreign companies to invest in the sector. Certified biofuel companies will be able to issue and trade emissions reductions credits (CBios), that fuel distributors will buy to comply with targets. This certificate market - though limited to the fuel industry - would be the first emissions reductions market in Brazil.
RenovaBio was approved by the Brazilian government in December 2017 and mandates fuel distributors to gradually increase the volumes of biofuels sold each year. Consequently, ethanol production should grow from the current 26 billion liters/year to at least 43-49 billion liters/year by 2030 and could even reach 54 billion liters/year by this date. Most of the increase would come from sugarcane-based biofuels - 26 new sugarcane mills would be commissioned by 2030 - though corn-based ethanol production should also increase to 3.4 billion liters/year by 2030.
BP currently has three ethanol mills in the country that crush 10 Mt/year of sugar cane. In 2017, it set up a joint venture (JV) with the Brazilian leading global ethanol seller Copersucar to operate one of the largest fuel terminals in the country located in Paulinia (state of Sao Paulo).