Analysis of Corporate Drivers of Carbon Intensity in Brazilian Sugarcane Mills

Renovabio is the Brazilian National Biofuels Policy. It aims to reduce the carbon intensity by 10% until 2030 by producing more biofuels. Ethanol is the main biofuel used in Brazil. The participating mills were evaluated by Renovabio, with an efficiency score calculated on the basis of the carbon intensity of the fuels produced. This paper investigates the effects of location, certification, inspection firm size, financial performance, and exportation on the efficiency scores of RenovaBio sugarcane mills. Tobit modeling was applied to analyze a database of 89 mills. The results indicate that return on assets and export have positive effects on the score; mill size, location, and inspection firms have no influence; and Bonsucro certification has a negative effect on scores. Public institutions can use the results to propose policies that have a significant effect on carbon intensity, which plays a fundamental role in the decarbonization of the Brazilian fuel sector.