Brazil Opportunities in Environment & Water

An Expert's View about Sewerage in Brazil

Last updated: 14 Mar 2011

The Brazilian Environmental Sectors is expected to receive investments of over U$ 10 billion per year for the next 10 years to meet up infrastructure demand.

Sector briefing Brazil Opportunities in Environment & Water Why Brazil? Brazil is the largest country in South America, both in geographical and commercial terms. As a high-growth market there is huge potential across many sectors. Brazil has the world?s largest reserves of tropical forest, biodiversity and flows of fresh water (25%). It has the largest underground reservoir (Guarani Aquifer). Brazil has a strong science base, is a keen promoter of technology transfer, and is a world leader in bio-fuel technologies. The Acceleration Growth Programme (known as ?PAC Plan?) launched in 2007 have driven investments in the areas of energy, transport, potential opportunities and an introduction to housing and sanitation. In addition, the other relevant issue construction programmes for the development of the sports events 2014 FIFA World Cup and 2016 Olympic Games will drive sustainable ?The Brazilian Environmental management plan frameworks that will bring Sectors is expected to opportunities for UK Environment Goods and Services. receive investments of over U$ 10 billion per year for the Find general information on the Brazilian next 10 years to meet up market conditions on UKTI?s website. The Doing Business Guide for Brazil g infrastructure demand. ives an overview of Brazil?s economy, business culture, UK Trade & Investment Sector briefing: Brazil opportunities in Environment & Water Opportunities The National Waste Policy where Brazil is leading the way in Latin America in terms of There is wide-range of factors driving producer responsibility principle and adoption investments in Environmental Goods & of legally binding instruments is expected to be Services (EG&S): an increasing number of sanctioned by October 2010. companies with environmental management systems, adoption of international standards of environmental performance by exporters and Water and wastewater treatment multinational companies, new legislation Constitutionally, the supply of basic sanitation framework etc. services (water and sewage) in Brazil is responsibility of the municipal government, Brazilian businesses are fully aware that their optionally exercised by means of a concession competitiveness is tied to improving to private enterprise. Up until now, most cities management of their social and environmental have fulfilled their constitutional obligation by impacts. In that sense, private companies are making a concession to a state-run basic extensively looking for low carbon solutions. sanitation company. Other cities operate their own services via a city sanitation department Current estimates of potential business in the or a municipally owned company. Brazilian environmental technologies sector (solid waste management, water supply and Most municipalities (80.9%) have running sanitation and air pollution control) and the water in the house and in urban areas this renewable energy sector are over US$ 10 figure goes to 94.2%. However, in terms of billion. Main investments were in water, sewage collection, approx. 50% of the followed by solid waste, energy efficiency and households are not connected to the sewerage air emissions reduction as follows. system, but this figure varies depending on the Brazilian region. As an example, the southeast Environmental Goods & Services: % is better served (70%) followed by the centre- Water 25.3% west (40%) whereas in the north is just 6.2%. Solid Waste 22.2% Only 32.5% of all sewage is collected and treated, most of which (11 billion litters), is Energy Efficiency 19.5% daily dumped in rivers, streams, beaches and Air Emissions Reduction 10.5% lakes. Basic sanitation has gained a new outline since Environment Legislation the approval of the Sanitation Act in December Brazil had important issues in its agenda for 2007 (11.445/07). The law reduced the COP15 (the UN Framework Convention on uncertainties at federal, state and municipal Climate Change in December 2009), such as levels. Finally, public private partnerships (PPP) REED (Reducing Emissions from Deforestation started to happen contributing to an increase in and Forest Degradation); Post-Kyoto protocol investments. Besides the new regulatory debate to define a further commitment period framework, Brazil announced plans to invest for GHG emissions reductions and Sustainable US$ 25bn into sanitation projects. Forest Management mechanism, which put Furthermore, the 12 FIFA World Cup host cities Brazil in a leading role to achieve significant Belo Horizonte, Brasília, Cuiabá, Curitiba, emissions reduction goals. Fortaleza, Manaus, Natal, Porto Alegre, Recife, Rio de Janeiro, Salvador e São Paulo) are President Lula has signed the National Policy currently receiving investments in water supply on Climate Change in December 2009 and sewage collection, to comply with patterns proposing a target for 36.1% to 38.9% established by FIFA and the national policy reduction in greenhouse gas emissions by goals for this sector. 2020. According to the International Federation of Environmental legislation such as the Private Water Operators in 2007 private Sanitation Law 11455/07, Public Consortium companies were servicing 10% of urban Law 11107/05 plus funds from PAC and IDB population in Brazil and since then there are 20 (Inter American Development Bank) has concession contracts or PPP?s. The differences fostered investments in the sanitation sector in in the systems demonstrate how the the past 2 years. UK Trade & Investment Sector briefing: Brazil opportunities in Environment & Water environmental sanitation sector is undergoing a Recycling revolution in terms of operational mechanisms. Of the 5,565 municipalities in Brazil around 405 municipalities recycle waste, thus serving Major Brazilian contractors are investing only 14% of Brazil?s population. The federal heavily in the sanitation sector and have set up government finances recycling facilities, total new companies such as Foz do Brasil from or partially, through BNDES (National Odebrecht Group and Cab Ambiental from Development Bank), as well as waste- Queiroz Galvao just to operate in this sector minimisation co-operatives for some sectors. There is potential market for new technology In terms of demand, Brazil boasts the world?s and products such as analytical and measuring highest rate of aluminium-can recycling (94%), equipment, monitoring equipment for thanks to an efficient collection system and the water/sewage treatment stations, sludge income that discarded cans represent for many treatment, leakage detection control, odour poor city dwellers. In 2008, recycling rates of removal processes, flow meters (micro/macro 51% for plastic bottles (PET) and 46% for glass measurements), pipe cleaning, pipe joints and waste was reached. There is still room for an flow control products, sensors and expansion of recycling, which will continue to environmental monitoring and industrial require waste collection equipment, size effluent. reducers and separators. Waste Management Technologies The new Brazil Waste Bill (due to be signed off Brazil's production of solid waste is approx. 47 by 2010) will boost major investments from millions tonnes/year (65% is organic content). the private and government sectors in reverse According to ABRELPE (Brazilian Association of logistics. Public Cleansing) currently more than 43% of this waste does not receive adequate Hazardous Waste destination, being either dumped in open According to ABETRE (Brazilian Association of terrain their waste or worse still dispose of it in Hazardous Waste Treatment) Brazil generates watercourses and other environmentally nearly 3 million tonnes of hazardous waste sensitive areas. Therefore, major cities in the each year, mainly in the south and south-east. country suffer from chronic problems in the The number of landfills capable of handling disposal of waste. special waste is insufficient and costs of incineration are high. Most of the private companies work under long-term concession from municipalities. In Construction Waste Brazil, there are currently 28 concession Recent estimates show that the waste resultant contracts in progress, serving 28.1 million from civil construction, house and buildings inhabitants corresponding to approximately reforms, maintenance and demolition represent 30% of the total population served by private around 50% of urban waste in main Brazilian companies. In these contracts, the complete cities. In Sao Paulo, due to the recent boom in concession modality is predominant, civil construction, this percentage might be comprehending urban cleansing (collection, even higher. transportation and sweeping) and final disposal. There local market demands technologies for solid waste treatment and recycling, such as São Paulo State alone produces 30,000 waste to energy plants, odour control tonnes/day (São Paulo City produces approx. equipment, landfill gas emissions monitoring 14,000 tonnes/day) and with landfills in the technologies etc. city operating up to their capacity limit. Sao Paulo State Secretariat for Environment has published a Resolution 79 covering licensing Contaminated Land Remediation aspects for energy recovery plants. This Official estimates put the number of resolution also imposes a strict control of contaminated sites in Brazil at 15,000. In atmospheric emissions originated from such November 2009 CETESB, Sao Paulo State plants. Therefore, this will offer opportunities Environment Agency), identified the existence for UK companies with offering waste to energy of over 2,500 contaminated sites in the state technologies. (77% related to petrol stations and 13% to industrial activity). UK Trade & Investment Sector briefing: Brazil opportunities in Environment & Water analysers and fugitive and particulate For most of the Brazilian states a specific emissions monitoring systems. legislation does not exist for the subjects that involve contaminated land. The existing CDM - Climate Development Mechanism environmental legislation offers a base Since the Kyoto Protocol was signed in 2005, referring to different aspects of the problem. there has been an increasing interest by However, São Paulo has approved (in July companies and potential investors in designing 2009) a State Law (13.577/09) on protection projects aimed at the reduction of greenhouse of soil quality and management of gas emissions. As a non-Annex I country, contaminated areas stating that land owners, Brazil?s involvement in the international climate users and who caused contamination will have change initiatives is through the Clean co-responsibility for the prevention, Development Mechanism (CDM). identification and remediation of the area. From a total of 1,882 registered projects in the The real estate boom in Sao Paulo over the UN Executive Board (Nov/09), there are 165 past two years has offered good opportunities Brazilian projects and the country occupies the for local companies given the urgent need to third post in registered projects, accounting for turn contaminated areas into new residential 8% of the global total. Plus, there is a record of and commercial building areas. 438 ongoing projects. Brazil ranks third among the countries with major annual GHG emissions Th with a total of 170 million tCO2e which is 8% e local market is well supplied with technical of the world-wide total. capacity and equipment dealing with remediation of land contaminated by petrol According to ABMEC (the Brazilian Association stations, but there is a serious need for of the Carbon Market Companies) who expertise in project management, risk represent 50% of all carbon credits generated assessment, monitoring strategies and data management as in the Brazil, CDM and Joint Implementation well as cost-effective solutions (JI) projects reached US$ 118 billion in 2008. for remediation of land contaminated by industrial activities. The predominance of the project activities in Air Pollution Contro Brazil is in the energy sector. Brazilian projects l On are divided into: average in main Brazilian cities, automotive vehicles are responsible for the emission of 62% of air pollution. However, the CDM Projects % metropolitan area of in São Paulo is Renewable Energy 49% responsible for 97% according to a study done Waste to Energy (Swine) 16% by CETESB (Sao Paulo Environment Agency). Fossil Fuel Switch 10% The cities of São Paulo, Campinas and Cubatão Landfill 9% region (a major petrochemical area) are Others 16% identified as the high level of pollutant emission recipients, both from vehicle and There is potential market for UK companies in industrial origins. The country side the areas of project design and management, municipalities also deserve attention due to carbon-trading mechanisms and funds, project their strong industrial development, large validation and low carbon technologies. number of vehicles and due to those areas where agricultural activities produce the emission of air pollutants (e.g. burning of Renewable energy sugar cane bagasse). Brazil is the world?s largest renewable energy The air pollution control sector lacks technical market, thanks to its hydropower and its long- capacity including those provided by established bio ethanol industry, the latter of laboratories. Most of the air pollution control which has thrived alongside the country?s equipment currently used is supplied by US sugarcane industry. Renewable sources make and European companies through locally 47.3% of the country?s energy mix and 84% of established partners. its power generation capacity, including large scale hydropower. Potential market opportunities for UK Suppliers of NOX and VOC control equipment, CEM UK Trade & Investment Sector briefing: Brazil opportunities in Environment & Water Brazil accounted for almost all renewable energy investment in Latin America in 2007 according to market specialists. There are many opportunities in the wind generation sector and cogeneration using sugar cane bagasse and swine dejects. If you have any questions on the opportunities above, contact the UKTI] contacts named in this report. Business opportunities aimed specifically at UK companies are added daily to UKTI?s website. These leads are sourced by our staff overseas in British Embassies, High Commissions and Consulates, across all sectors and in over 100 markets. You can be alerted to business opportunities on a regular basis by registering on the UKTI website. Find out more on UKTI?s business opportunities service on the UKTI website UK Trade & Investment Sector briefing: Brazil opportunities in Environment & Water Major events and activities UKTI contacts UKTI Brazil Mission to Futuresource 2010 Valeria Martinez Email: Sector Manager Time: 14 to 18 June, London British Consulate-General, São Paulo, Brazil Tel: +55 11 3094 2735 UKTI Environment and Water Mission Email: to FIMAI 2010 (Environmental Trade Show) Email: Flavia Paolucci Time: 7 to 11 November, Sao Paulo Assistant Sector Manager British Consulate Brazil, São Paulo Tel: +55 11 3094 2736 Email: Find full details of all events in this country and sector on the UKTI website. New export events are added daily to the site and you can register to be alerted to them on a daily, weekly or monthly basis UKTI?s Tradeshow Access Programme (TAP) provides grant support for eligible Small & Medium Sized Enterprises (SME's) to attend trade shows overseas. Find out more about UKTI support for attendance at overseas events UK Trade & Investment Sector briefing: Brazil opportunities in Environment & Water Next steps - How UKTI can help British companies wishing to develop their business in the Brazilian market are advised to undertake as much market research and planning as possible in the UK. UKTI?s team in Brazil with its wide local knowledge and experience, can provide a range of services to British-based companies wishing to grow their business in global markets. This can include: ? Provision of market information ? Validated lists of agents/distributors ? Key market players or potential customers in the Brazilian market ? Establishment of interest of such contacts in working with you ? Arranging appointments ? Organise seminars or other events for you to meet contacts and promote your company in the Brazilian market This work is available via our Overseas Market Introduction Service (OMIS) a chargeable service which assists British-based companies wishing to enter or expand their business in overseas markets. To find out more about commissioning this work, or accessing other UKTI services and specialist advice, please visit the UKTI website to find contact details for your local UKTI office. Whereas every effort has been made to ensure that the information given in this document is accurate, neither UK Trade & Investment nor its parent Departments (the Department for Business, Innovation & Skills, and the Foreign & Commonwealth Office), accept liability for any errors, omissions or misleading statements, and no warranty is given or responsibility accepted as to the standing of any individual, firm, company or other organisation mentioned. Published 2010 by UK Trade & Investment. Crown Copyright © UK Trade & Investment Sector briefing: Brazil opportunities in Environment & Water
Posted: 29 September 2010, last updated 14 March 2011

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