The Brazilian government is set to publish a decree within weeks to regulate the country’s low-carbon hydrogen legal framework, a move expected to unlock billions of dollars in investments and solidify the nation’s role in the global energy transition.
The regulation is the final hurdle to implementing the Low-Emission Hydrogen Development Program (PHBC), which offers approximately 18.3 billion reais ($3.2 billion) in tax credits. The decree will define certification criteria and legal safeguards for companies looking to tap into Brazil’s abundant renewable resources.
CEARÁ TAKES THE LEAD
The northeastern state of Ceará has emerged as the primary hub for green hydrogen in Brazil. Currently, the state hosts six of the 13 most advanced projects in the country, centered around the Pecém Industrial and Port Complex.
Major global players have already committed significant capital to the Pecém Green Hydrogen (H2V) Hub:
- Fortescue: Plans to invest 18 billion reais;
- Casa dos Ventos: Estimating 12 billion reais in outlays;
- Global Players: Qair, FRV, Voltalia, and EDF are also developing large-scale initiatives.
TECHNOLOGICAL BREAKTHROUGH
Parallel to the regulatory push, Brazilian researchers have identified a new strategy to lower the cost of hydrogen production. A study by the Center for the Development of Functional Materials (CDMF) at the Federal University of São Carlos (UFSCar) suggests that catalysts made from abundant metals like iron and nickel can match the efficiency of noble metals like platinum.
Using computational modeling, scientists found that adjusting the ratio of these common metals allows for precise control over hydrogen adsorption, potentially making green hydrogen plants more scalable and cost-effective.
BAHIA’S RENEWABLE DOMINANCE
While Ceará focuses on hydrogen, the neighboring state of Bahia has solidified its position as Brazil’s renewable powerhouse. As of World Energy Day, 99% of the electricity produced in Bahia comes from renewable sources.
The state is the national leader in wind power, with 11.8 GW of installed capacity, and ranks high in solar with 2.97 GW. This energy surplus is attracting major industrial players, including Chinese EV giant BYD, which has established a manufacturing complex in Camaçari.
"Bahia is moving from being a major producer of clean energy to becoming an industrial and technological hub for the energy transition," said Aécio Moreira, acting secretary for economic development.
THE NEXT FRONTIER: OFFSHORE WIND
Further north, Rio Grande do Norte is positioning itself as a pioneer in offshore wind and "Power-to-X" technologies. Industry leaders in the state argue that the synergy between offshore generation and green hydrogen production will be the next major driver for regional development.
As Brazil prepares to open public consultations for hydrogen auctions later this year, the competition between these northeastern states is expected to accelerate the country's shift toward a low-carbon economy, targeting strategic sectors like steel, fertilizers, and cement.
