Brazil's strategic bet on green hydrogen.
On October 22, 2025, during the 4th Brazilian Hydrogen Congress in Brasília, the Ministry of Science, Technology and Innovation (MCTI) and the Brazilian Industrial Research and Innovation Company (Embrapii) announced a public call for proposals totaling R$ 60 million for the accreditation of institutions that will integrate the Embrapii Center of Competence in Low Carbon Hydrogen. The resources, from the National Fund for Scientific and Technological Development (FNDCT), will be distributed over three years and represent a milestone in Brazil's green reindustrialization strategy.
This initiative goes beyond investment in academic research. It represents the consolidation of a political and economic commitment that positions Brazil as a developer of innovative technologies in the hydrogen sector, and not merely as a user of imported solutions. The movement is aligned with the Ecological Transformation Plan (New Brazil), led by the Ministry of Finance, and is part of the Brazilian Hydrogen Initiative (IBH2).
Structure and operation of the Competence Center
The model proposed by Embrapii brings academic research closer to industrial application through innovative governance. Embrapii will conduct the call for proposals, while the Ministry of Science, Technology and Innovation (MCTI), through the Secretariat for Technological Development and Innovation (Setec), will oversee the strategic implementation. A technical committee composed of energy and innovation experts will conduct periodic evaluations of the developed projects.
Eligible institutions are public or private, non-profit Science and Technology Institutions (ICTs) that demonstrate adequate physical infrastructure, a proven track record of industry relations, and prior experience in the field of hydrogen. A key differentiating factor is the requirement of commitment to developing international partnerships with leading research institutions.
The application deadline is November 24, 2025, with selection results expected in May 2026. The funds will be used to structure laboratories, hire and train researchers, and finance projects in partnership with the industrial sector.
Five priority research areas
The Center of Excellence will structure its activities into five major strategic areas:
- Low-emission hydrogen production: The focus will be on developing technologies for production from sustainable sources, including alkaline electrolysis (AEL), PEM electrolysis, solid oxide electrolysis (SOEC), and routes using ethanol and biomass – leveraging Brazil's unique competitive advantages. Current electrolysis has an efficiency of 60-70%, with projections of technological improvements that could raise these rates by 2030.
- Hydrogen Storage: Safe and efficient storage solutions are essential. The global hydrogen storage market is expected to grow from US$18.78 billion in 2025 to US$34.56 billion by 2034, with a compound annual growth rate of 7.01%. Technical challenges such as hydrogen embrittlement in pipelines require ongoing research into new materials.
- Transportation and distribution: Brazil faces significant challenges, with its gas pipeline network concentrated in coastal areas and inadequate technical specifications for pure hydrogen. Furthermore, 55% of Brazil's road infrastructure is in reasonable, poor, or very poor condition, according to the National Confederation of Transport (CNT).
- Security: Protocols, standardization, and safety guidelines are essential to enable industrial-scale operations and gain the trust of international investors.
- Strategic industrial applications: Sectors such as steelmaking, cement, fertilizers, transportation, electricity generation, and chemical processes are priority targets for decarbonization.
Global context and competitive positioning
The global hydrogen market is projected to expand from US$229.53 billion in 2025 to US$353.52 billion in 2032, with an annual growth rate of 6.36%. Green hydrogen, specifically, has the highest projected growth rate: 15.33% per year, according to Fortune Business Insights.
Brazil possesses competitive advantages that no other country combines simultaneously: an energy matrix that is 80% renewable, the technical potential to produce 1.8 gigatons of hydrogen per year at competitive costs, and established domestic industrial demand. According to the Ministry of Mines and Energy (MME), the country has the lowest production cost among world powers.
Europe, which will need to import 50-70% of its hydrogen needs, represents a strategic opportunity. Germany has already allocated €270 million to encourage the hydrogen industry in partner countries, with expectations of leveraging €1.3 billion in private investment. Brazil's geographical proximity to Europe (7,000 km versus greater distances to the Middle East and Australia) offers an additional logistical advantage.
Projects under development and economic potential
The National Confederation of Industry (CNI) has mapped projects totaling R$ 188.7 billion in announced investments. Unigel, in Camaçari (Bahia), stands out as the largest project under construction in Brazil: an investment of US$ 1.5 billion and a final capacity of 100,000 tons of green hydrogen per year by 2027, also producing 600,000 tons of green ammonia per year.
In Ceará, projects by Casa dos Ventos (US$ 8.4 billion) and Fortescue (R$ 20 billion) are awaiting final investment decisions. Both face challenges related to energy availability and connection to the transmission grid, highlighting infrastructure bottlenecks that need to be addressed.
Brazil's economic potential is significant. McKinsey projections indicate that the domestic market could reach US$10-12 billion annually by 2040, with a volume of 7.2-9.1 million tons. The export market could reach an additional US$4-6 billion. In the most optimistic scenario, Brazil could generate US$15-20 billion annually by 2040, consolidating itself as a globally competitive producer.
Challenges and opportunities
Despite its competitive advantages, Brazil faces structural challenges. The current cost of US$6/kg needs to fall to US$2/kg to make applications viable in sectors such as steelmaking (a 67% reduction is still needed). Transportation and storage infrastructure requires massive investments, and logistics costs can triple the value spent on production.
The expansion of renewables should accelerate from 4% to 7% per year. By 2030, Brazil would need to add 19-39 GW of renewable capacity, representing 11-22% of its current capacity. By 2040, this need jumps to an additional 129-178 GW.
On the other hand, the country has unique value-added opportunities: green ammonia for fertilizers, green methanol for the chemical industry, sustainable aviation fuel (SAF), green steel, and advanced biofuels integrating hydrogen.
Conclusion: window of opportunity
The launch of the R$60 million public call for proposals represents more than just an investment in research. It consolidates Brazil's strategic commitment to becoming a global leader in an industry that will generate billions of dollars in the coming decades.
With an unparalleled energy matrix, established domestic demand, and export potential to premium markets such as Europe and the United States, Brazil possesses conditions that no other country simultaneously. The window of opportunity is open. Investments in research, infrastructure, and training over the next five years will determine whether the country will be dominant or marginal in the 21st-century green hydrogen economy.
