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Abstract
This paper estimates the CO2 emission and economic gains of different ways of altering the Brazilian energy production and consumption system. Based on sectorial data and the Brazilian Decennial Energy Plan, we use a recursive computable general equilibrium model to simulate the trajectory of the main macroeconomic compounds (Gross National Product, household consumption, investment, exports, imports, employment, and inflation), gains in welfare indicators, and CO2 emissions by 2026. These trajectories are computed under two different scenarios: increased energy and consumption efficiency, and inflated wind-solar grid. Despite the slower economic growth when compared to the first scenario, the latter would render larger gains for household consumption among the poorer families. Policy implications are discussed on the importance of these changes to the success of multilateral international agreements and the future of Brazilian leadership on climate-related adaptation policies.