According to Under Secretariat, financial squeeze and need for approval in Congress would make it difficult to create a regulatory agency
The federal government has postponed the creation of a carbon market regulatory agency and will install an extraordinary secretary on the subject in the Ministry of Finance in August. The Undersecretary of Sustainable Economic Development, Cristina Reis, made the announcement on Wednesday (23.Jul.2025).
“In other countries, these managers vary greatly in format […] We understand that regulatory agency is the best format, but it is also the most expensive and most complex, which requires competition and depends on congressional approval ”said during the Brazilian Conference Climate and Carbon, organized by the Brazil NBS Alliance.
Cristina Reis says that, even with an installed undersecretary, the creation of the regulatory agency continues in the government’s plans, given the need for a “Robust organ” that can give more “Legal and operational certainty” for the regulated carbon market.
The Undersecretary at the Ministry of Finance should be responsible for the subject for the next 2 years.
Regulated market
The regulated carbon market is an instrument created to limit greenhouse gas emissions, such as CO₂ (carbon dioxide), and promote transition to low carbon economy.
In the model, companies in sectors intensive in emissions – as energy, agribusiness, transportation and industry – receive or buy permissions to emit a certain amount of polluting gases.
If they issue less than allowed, they can sell surplus credits; If they exceed the limit, they need to buy credits from other companies to compensate for the excess.
The system is known as “limit and trade”. The government establishes a ceiling of emissions and gradually reduces this limit over time, forcing regulated sectors to invest in cleaner technologies.
The model differs from the voluntary carbon market, where companies and individuals buy credits at their own initiative, without legal requirement, as part of environmental commitments or sustainable marketing strategies.
