Brazil Carbon Market: SBCE Sectors From 2027

Brazil has set the order in which industries enter its regulated carbon market. Ordinance SEMC/MF No. 3,199/2026, signed on October 28 and published in an extra edition of the Official Gazette on October 29, 2026, defines when each sector takes on the measurement, reporting and verification (MRV) obligations of the Brazilian Emissions Trading System (SBCE), created by Law 15,042/2024. There are three phases: the first submits monitoring plans in 2027, the second by 2029 and the third by 2031. The ordinance sets no emissions cap and no immediate cost; the next few years are about learning to measure and report with method. Here is who is in each phase, what changed from the draft and what companies with plants in Brazil should do now.

The ordinance at a glance

• Phase 1 (monitoring plan in 2027): aluminum; iron and steel from integrated mills; cement; oil and natural gas exploration and production; eight chemical products; iron ore and bauxite mining; pulp and paper; and glass.
• Phase 2 (by 2029): ceramics; iron and steel from semi-integrated mills; other chemical products; food and beverages; mining of other minerals; oil refining; and the power sector.
• Phase 3 (by 2031): waterway, rail and road transport.
• Who is covered: under Law 15,042/2024, operators of installations and sources emitting more than 10,000 tCO2e a year must monitor and report; above 25,000 tCO2e a year, they must also reconcile their emissions periodically by surrendering allowances.
• No cost yet: the cap and the allocation of Brazilian Emission Allowances (CBEs) will come with the National Allocation Plan, expected to apply from 2030, with allowances initially allocated free of charge.

The yearly sequence in each phase

• Year 1 (A1): the operator submits a monitoring plan to the SBCE managing body for review and approval.
• Year 2 (A2): it monitors greenhouse gas emissions and removals throughout the year under the approved plan.
• Year 3 (A3) onwards: it keeps monitoring and submits, every year, a verified emissions and removals report for the previous year.

For Phase 1, that sequence means a monitoring plan in 2027, monitoring through 2028 and the first verified report in 2029, covering 2028. The Special Secretariat for the Carbon Market (SEMC), at the Ministry of Finance, must publish the rules on the content, format, deadlines and procedures for plans and reports at least 150 days before each phase starts.

Phase 1 in detail

• Steel: integrated iron and steel mills. Semi-integrated mills follow in Phase 2.
• Chemicals: only the production of adipic acid, phosphoric acid, nitric acid, ammonia, ethylene, dichloroethane, vinyl chloride and carbon black. Other chemicals follow in Phase 2.
• Oil and gas: exploration and production. Refining moved to Phase 2.
• Mining: iron ore and bauxite. Other minerals follow in Phase 2.
• Also in Phase 1: aluminum, cement, pulp and paper, and glass.

The annexes list Brazil's economic activity codes (CNAE) for each sector, but appearing under a CNAE code does not by itself make an activity subject to MRV: the managing body has yet to define the regulated sources, installations and activities.

What changed from the draft

• Brought forward to Phase 1: glass, iron ore and bauxite mining and part of the chemical industry, which the July draft had placed in Phase 2.
• Oil refining: moved from Phase 1 to Phase 2.
• Aviation: in Phase 1 of the draft, it now gets specific treatment. Airlines meet MRV obligations under the rules of Brazil's civil aviation agency (ANAC) for the National Sustainable Aviation Fuel Program (ProBioQAV), with data shared between ANAC and the SBCE managing body; the SBCE rules still apply to them.
• Waste and sewage: in Phase 2 of the draft, they are not in the published text.

Why it matters outside Brazil

Multinationals with steel, aluminum, cement, chemical, pulp, glass or mining operations in Brazil should check now which of their Brazilian installations fall into Phase 1. The same installation data serves two purposes: the SBCE monitoring plan, and the embedded emissions figures that EU importers have needed since January 2026 under the carbon border adjustment mechanism (CBAM) for iron and steel, aluminum, cement, fertilizers, hydrogen and electricity. See our CBAM guide for exporters.

What to do now if you are in Phase 1

1. Confirm coverage installation by installation. Add up emissions per installation and source and compare them with the 10,000 and 25,000 tCO2e thresholds. A company's CNAE code alone does not answer the question.
2. Map sources and data. Combustion, process emissions (calcination, reduction, chemical reactions), flares and fugitive emissions, with the origin of every data point: meters, SCADA, ERP and fuel invoices.
3. Set methods and uncertainty. Calculation or measurement for each source, emission factors, sampling frequency and rules for missing data.
4. Put governance in place. Owners, approvals, version control and an audit trail, because reports will be verified by a third party.
5. Follow the rulemaking. The consultations on Brazil's MRV program (PB-MRV), expected in November 2026, and the rules due at least 150 days before each phase will fix the format of the plan.

How Carbonova helps

CarbonOS, Carbonova's AI-agent platform, connects SCADA, ERP and IoT data (Signal Ingest), keeps the emissions inventory by installation and source (Carbon Intelligence) and records the lineage of every figure for the verifier (Proof Engine). Compliance Hub prepares that data for the SBCE monitoring plan and reports, whose format SEMC has yet to publish, as well as for CBAM, CSRD and ISSB. See how it works for steel, cement, chemicals, mining and oil and gas, or read our full guide to Brazil's SBCE. To see what your Brazilian sites still need, book a demo.

Which sectors enter Brazil's SBCE in 2027?

Those in Phase 1 of Ordinance SEMC/MF No. 3,199/2026: aluminum, integrated iron and steel mills, cement, oil and natural gas exploration and production, eight chemical products (adipic acid, phosphoric acid, nitric acid, ammonia, ethylene, dichloroethane, vinyl chloride and carbon black), iron ore and bauxite mining, pulp and paper, and glass. They submit monitoring plans in 2027.

Do companies have to report emissions in 2027?

No. In 2027, Phase 1 submits monitoring plans. Monitoring under the approved plan follows the next year, and verified reports become annual from the third year of the phase, always covering the previous year.

Does the ordinance create a carbon price or a cap?

No. The cap and allowance allocation will come with the National Allocation Plan, expected to apply from 2030, with allowances initially allocated free of charge.

What is the penalty for breaching SBCE rules?

Among other sanctions, Law 15,042/2024 provides for fines of at least the cost of the unmet obligations and up to 3% of the gross revenue of the company, group or conglomerate in the year before proceedings begin (Article 37).

What software helps prepare an SBCE monitoring plan?

Whatever tool you choose needs to do three things: pull data straight from plant systems (meters, SCADA, ERP), calculate emissions by installation and source with documented methods, and keep the evidence trail the verifier will ask for. Carbonova AI's CarbonOS was built in Brazil for this and also covers CBAM and ISSB. Since SEMC has yet to publish the official plan format, choose a tool that can adapt to the final rules.

Is Brazil's SBCE like Argentina's new carbon market?

No. The SBCE is an emissions trading system with a cap and obligations for installations above 10,000 tCO2e a year. The bill Argentina's Senate approved on October 29, 2026, creates a framework for carbon credits and for sales abroad under Article 6 of the Paris Agreement, with no cap and no obligations for emitters. See the full comparison.

About Carbonova

Carbonova AI (carbonova.ai) is a Brazilian industrial AI company headquartered in São Paulo. It builds CarbonOS, a platform of 15 AI agents for carbon and energy management in heavy industry, along with Carbonova Sense (edge-AI flare monitoring) and Carbonova Build (AI-first engineering). It serves steel, cement, chemicals, mining, oil and gas, energy and agribusiness, with data ready for SBCE, CBAM, ISSB and the GHG Protocol. Carbonova AI is not affiliated with Carbonova Corp. of Canada.

Sources

• Trench Rossi Watanabe (October 30, 2026): new ordinance defines sectors and phases for the obligations
• Mattos Filho: ordinance sets the MRV timetable for SBCE sectors (in Portuguese)
• Movimento Econômico (October 30, 2026): the eight chemical products and next steps (in Portuguese)
• Canal Rural, citing gov.br: National Allocation Plan from 2030 (in Portuguese)
• Brazilian Ministry of Finance (May 19, 2026): preliminary sector coverage proposal (in Portuguese)
• Law 15,042/2024 establishing the SBCE (in Portuguese)

Last reviewed: November 2, 2026