Proposal wants to use exploration resources for the Low Carbon program as a way to boost the energy transition in Brazil
A proposal from (Brazilian Association of the Green Hydrogen Industry) presented this Tuesday (March 17, 2026), suggests the use of resources from oil exploration (royalties) to finance clean energy projects in Brazil. The measure proposes the extraordinary allocation of these resources to the PHBC (Low Carbon Emission Hydrogen Development Program), aimed at developing hydrogen with lower carbon emissions.
The initiative is supported by 35 companies and representatives of the hydrogen industry, who see public financing as an essential step to make projects still considered expensive and at an early stage viable. Read the proposal (PDF – 8 MB).
In the document, ABIHV states that “the extraordinary allocation of oil royalties for payment to PHBC resources […] is capable of promoting the production of the asset”.
The objective is to strengthen the production of low-carbon hydrogen, seen as an alternative to reducing emissions in sectors such as industry and transport.
Royalties are amounts paid by oil companies to the Union, States and municipalities for oil and gas exploration. Today, these resources have different uses, such as education and infrastructure. The proposal, however, advocates redirecting part of these values to accelerate the energy transition.
For the association, the measure also dialogues with the international debate on reducing the use of fossil fuels, intensified in COP30which will be held in Brazil. The country is working on drafting an energy transition plan that must include financing mechanisms for renewable sources.
Despite its potential, the proposal may face political resistance. States and municipalities depend on oil royalties to pay their bills, which can generate disputes over the redistribution of these resources.
