Brazil’s New Green Hydrogen Industry: An Assessment of Its Macroeconomic Viability Through an Input–Output Approach

Abstract

This manuscript explores the role of green hydrogen produced through ethanol reforming in accelerating Brazil’s transition to a low-carbon economic framework. Despite ongoing efforts to lessen carbon dependence, Brazil’s reliance on biofuels and other renewable energy sources remains inadequate for fully achieving its decarbonization objectives. Green hydrogen presents a vital opportunity to boost energy sustainability, especially in sectors that are challenging to decarbonize, such as industry and transportation. By analyzing Brazil’s input–output (I-O) table, using data from the Brazilian Institute of Geography and Statistics (IBGE), this study evaluates the macroeconomic potential of green hydrogen, focusing on GDP growth and employment generation. Furthermore, the research explores green hydrogen systems’ economic feasibility and potential impact on future energy policies, offering valuable insights for stakeholders and decision-makers. In addition, this investigation highlights Brazil’s abundant renewable resources and identifies the infrastructural investments necessary to support a green hydrogen economy. The findings aim to strengthen Brazil’s national decarbonization strategy and serve as a model for other developing nations transitioning to clean energy.