The announcement of the partnership between the governments of Brazil and the United Kingdom, materialized in the Industrial Decarbonization Incubator with an initial investment of R$ 8.1 million, signals that reducing emissions from the productive sector on a large scale is urgent.

By focusing on the steel industry, the initiative recognizes the critical nature of the transition to low-carbon steel. The steel industry accounts for approximately 8% of global greenhouse gas emissions.

This historical pressure, combined with increasing regulation, has transformed decarbonization into a mandatory requirement. Globally, Europe is advancing with taxes (Cbam) on products with a high carbon footprint, while Japan offers subsidies for green steel.

During COP30 in Belém (PA), leaders converged on the understanding that overcoming dependence on fossil fuels is a political and economic imperative. In this context, Brazil emerges with unique strategic assets, positioning itself as a key player in the global solution: large reserves of high-purity iron ore and an abundance of renewable energy.

The combination of these factors is ideal for the mass production of green iron, an essential input for fueling electric arc furnaces, replacing coal-fired blast furnaces.

This vision finds strong international support. A study by the IEA (International Energy Agency) suggests that countries with oil and gas revenues, such as Brazil, create national funds to finance the energy transition, directing resources to competitive sectors such as green steel. This recognition validates Brazil’s potential to lead decarbonization.

In the financial market, the perception is convergent. Analysts and investors recognize that green iron is emerging as one of the main drivers of growth in the modern steel industry.

Moody’s indicates that Brazil has unique conditions to assume leadership in the sustainable finance market in Latin America, thanks to its vast renewable energy generation capacity, conducive to technologies such as H2V and industrial electrification.

The Brazil-UK Incubator acts as a catalyst to overcome barriers. By focusing on early-stage startups and supporting the scale-up of solutions, it allows innovations to move from laboratories to industrial scale. Its true power lies in integrating the agility of startups with the structure and capital of large corporations. The goal is to go beyond meeting targets: it is to rethink the industrial architecture to establish a legacy of clean development for future generations. For investors, the message is clear: Brazil is capable of exporting not only raw materials[1], but also high value-added solutions and products with a low carbon footprint. This requires cooperation, venture capital financing, and strategic vision. It is the effective engagement of national industry that will allow the country to reposition itself as a protagonist in the transition to a low-carbon economy.

By Emerson Souza.

Source: Poder360 Emerson Souza | Brasil e Reino Unido avançam parceria pela descarbonização