INTRODUCTIONTHEORETICAL CONCEPTS AND FRAMEWORKTHEORETICAL CONCEPTS AND FRAMEWORKThe Brazilian energy matrixtable_3Note. Source: EPE (2022).Note. Source: EPE (2022).Oil and gas in BrazilPolicy mixesRenewables in BrazilRenewables in BrazilRenewables in BrazilMETHODOLOGYConnecting the theoretical framework to the methodology and resultsConnecting the theoretical framework to the methodology and resultstable_4the policy components and linkages within the policy mix framework as applied in this article.the policy components and linkages within the policy mix framework as applied in this article.the policy components and linkages within the policy mix framework as applied in this article.the policy components and linkages within the policy mix framework as applied in this article.RESULTS AND ANALYSESRESULTS AND ANALYSES Energy policy mix in Braziltable_5Note. Source: The authors, with data from IEA (2018).Table 4. Consistency of Brazil’s principal plans for energy with the transition’s goals.table_6newables in the Brazilian energy matrix. Therefore, there are no contradictions with the transition’s ob- jective of increasing renewables activity by O&G com- panies. Nevertheless, there is a contradiction in the transition’s objective of reducing E&P activity with the energy policy’s objective of increasing the use of nat- ural gas. As for the objective of ensuring the supply of petroleum products, it is not necessarily a trade-off with the reduction of activity in E&P, as a reduction can occur, and the supply can still be guaranteed, so we defined it as neutral. With this consistency analysis, we conclude that most policy objectives and principal plans of Brazil’s energy policy align with the transition.newables in the Brazilian energy matrix. Therefore, there are no contradictions with the transition’s ob- jective of increasing renewables activity by O&G com- panies. Nevertheless, there is a contradiction in the transition’s objective of reducing E&P activity with the energy policy’s objective of increasing the use of nat- ural gas. As for the objective of ensuring the supply of petroleum products, it is not necessarily a trade-off with the reduction of activity in E&P, as a reduction can occur, and the supply can still be guaranteed, so we defined it as neutral. With this consistency analysis, we conclude that most policy objectives and principal plans of Brazil’s energy policy align with the transition.table_7Note. Source: The authors.table_8many inconsistencies with the goals of the transition for it has many instruments aiming to promote O&G. One of the interviewees, the oil company VP, said that “the oil business would secure our income while our company shifts to renewables,” supporting that in- struments that promote O&G may indirectly favor in- vestments in renewables by O&G companies. In line with that view, the other interviewee said that O&Gtable_9Note. Source: The authors.O&G companies’ activities in BrazilO&G companies’ activities in Braziltable_10table_11keep developing their blocks, like Bacalhau and BM-C- 33 for Equinor and Pau Brasil for bp. Although these companies do not show signs of reducing their E&P activity in Brazil in the next few years, most of them are increasing their renewables activity. Petrobras, Shell, Total, Equinor, and bp all have renewable energy as- sets already producing in Brazil, like biofuels, biogas, onshore wind, and solar power. Shell and bp are nota- ble for ethanol production through joint ventures (with Raízen and bp Bunge, respectively). In solar and wind, Petrobras, bp, Total, and Equinor are already produc- ing significant amounts of energy. Repsol Sinopec is the only one of the seven companies considered here that do not have any renewable’s activities in Brazil (BP, 2021a; 2021b; Equinor, 2020; 2021; 2023; Galp, 2021b; Petrobras, 2021; Repsol, 2021; Shell, 2022; Total Energies, 2021b). Table 8 presents a summary of the O&G companies’ renewables activities in Brazil.Table 8. Summary of activities in renewables for the O&G companies in Brazil.table_12It is important to note that O&G companies are rel- evant players in the renewables market. For example, in the ethanol market, Shell’s joint venture with Raízen is the largest producer in Brazil, while bp Bunge is in the top four (UDOP, 2020), and Lightsource bp has a mas- sive capacity of 2.2 GW from solar power. As we see that O&G companies in Brazil continue to make huge investments in the O&G business, even with the exis- tence of various instruments favoring renewables, we propose that:DISCUSSION ON O&G SUBSIDIES IN BRAZILDISCUSSION ON O&G SUBSIDIES IN BRAZILDISCUSSION ON O&G SUBSIDIES IN BRAZILDISCUSSION ON O&G SUBSIDIES IN BRAZILDISCUSSION ON O&G SUBSIDIES IN BRAZILCONTRIBUTIONS AND FINAL REMARKSCONTRIBUTIONS AND FINAL REMARKSCONTRIBUTIONS AND FINAL REMARKS /RmtR[-]d  )1+Qw'FWe discuss the main barriers in the Brazilian pub- lic policies that can hinder a transition toward renew- ables, including the fossil fuel subsidies that under- mine the global efforts to shift resources to a cleaner and sustainable energy matrix. Brazil heavily subsi- dizes its O&G production because it stimulates short- term economic growth and creates tax revenue to address social issues. We further discuss if these sub- sidies have effectively accomplished these two (eco- nomic and social) objectives and if the country should still need them. However, at least in the short run, we found that Brazil keeps going in an opposite direction of a needed transition to renewables since it still relies on a fossil fuel exploration regime with plenty of sub- sidies. Finally, we propose directions for the Brazilian policy mix to favor the transition of the O&G compa- nies toward renewables and to reform their fossil fuel subsidies. 2 BAR-Brazilian Administration Review, 20(1), e220087, 2023. A. Noguchi, F. S. NobreTHEORETICAL CONCEPTS AND FRAMEWORK expenditure (CAPEX) on renewables and electric mo- bility during 2022-2025 (Total Energies, 2021a). The transition of O&G companies O&G companies are unlikely to transition to renew- ables as Ørsted did ultimately. It is perilous to move out of their core business, and petroleum products will still be needed for many more decades (Hartmann et al., 2021; Stevens, 2016). As a first step to decarbonizing, O&G companies are likely to reduce their carbon inten- sity, deaccelerate their O&G exploration and production (E&P), and diversify their business portfolio with cleaner technologies (Fattouh et al., 2018; Stevens, 2016). O&G companies have sustained their business-as-usu- al models by continuously searching for new reserves, executing enormous projects, and not worrying too much about their operations’ externalities (like flaring). However, in a world of growing preoccupation with cli- mate issues and commitment to reducing fossil fuels, their old businesses show signals of failure. One of the pillars of this business model is to maximize the com- pany’s proven reserves, which means constantly drill- ing and acquiring new oilfields to increase their expect- ed future revenue. As the access to low-cost oilfields is getting scarce, companies have been exploring places like ultra-deep waters (e.g., the Brazilian pre-salt layer) or shale (typical in the USA). These oilfields increase the costs of adding new reserves and producing O&G, re- duce profitability, and make it more difficult for O&G companies to increase their value (Fattouh et al., 2018; Stevens, 2016). Like Brazil’s Repetro tax exemption pro- gram for O&G, production subsidies are essential to commercially make feasible many of the costly pre-salt layer fields (Centro Brasileiro de Infraestrutura [CBIE], 2019). Nevertheless, the growing number of legislations worldwide that restrict or phase out fossil fuels can fa- vor energy transition policy plans. France and Spain’s long-term decisions to date the end of all O&G produc- tion in their territory (for 2040 and 2042, respectively), and Canada, which has imposed restrictions for new licenses for offshore O&G in the Arctic (London School of Economics [LSE], 2021), are examples of the plans favoring progress in the energy transition.Intriguingly, national O&G companies (NOC), like Petrobras (the state-owned Brazilian O&G compa- ny, founded in 1953), seem to be behind the private companies, like Shell and Equinor (called international O&G companies, or IOCs), in the shift to renewables. According to one of the interviewees in this study — a petroleum politics researcher from an O&G multina- tional in Brazil —, NOCs have different concerns than the IOCs, like ensuring the nation’s oil supply and re- solving social issues. Indeed, NOCs are not driven by stock prices, and they are not pressed for climate ac- tions as the IOCs are. Thus, IOCs are generally pushed to decarbonize faster than NOCs. The interviewee said, “you don’t see protests at CNOOC and Gazprom’s doors like you see at Exxon’s.” Cheon et al. (2015) argue that NOCs are generally oriented by their ‘national pur- pose,’ and that their political and economic goals come before profit. Petrobras, for example, is a NOC, and it has a clear strategy to focus on O&G production for the following years, with very few activities in renewables (Petrobras, 2021). The state should serve as an exam- ple, but these contradictions suggest that private O&G companies are more interested in the energy transition than governments of oil-exporting countries. Aware of the increasing difficulties of operating their oil and gas-based business model, many O&G com- panies diversify their portfolios. One common strate- gy is mergers and acquisitions or joint ventures with renewable energy companies, like bp with Bunge and Shell with Raízen in Brazil for ethanol production. Shell created a ‘New Energies’ division in 2016 to work with hydrogen, renewable energies, and electrical vehicles (Pickl, 2019), and Total plans to spend 20% of its capitalThe Brazilian energy matrix According to the Brazilian Company of Energy Studies (EPE, 2022), Brazil’s energy matrix comprises 46% of re- newables. In contrast, the world average is merely 14% (EPE, 2022; IEA, 2021). Table 1 presents the breakdown of each energy source in the matrix. Table 1. Break down of the Brazilian energy matrix (in 2021).table_3Note. Source: EPE (2022). BAR-Brazilian Administration Review, 20(1), e220087, 2023. Oil and gas companies — Are they shifting to renewables? A study of policy mixes for energy transition in Brazil sugar cane producer globally (Statista, 2023). While the country has had little growth and sometimes a decrease in its hydropower production in the last few years, the production of sugar cane derivatives is still growing (Empresa de Pesquisa Energética [EPE], 2021b). When it comes to the electricity matrix, the share of renewables is 83% in Brazil, and the world average is 27%. This high share of renewables comes from hydro- power (65.2%), biomass (9.1%), wind power (8.8%), and solar power (1.7%) (EPE, 2022). In Brazil, the total hy- dropower production has slightly decreased from 34.6 Mtoe in 2010 to 34.0 Mtoe in 2020, while the petroleum production increased from 106.5 to 152.6 Mtoe in the same period (Empresa de Pesquisa Energética [EPE], 2021a). It is noteworthy that the capacity for hydropow- er electricity production is expected to increase only 4.2% from 2020 to 2030, while petroleum production is expected to grow 62.2% in the same period (Ministério de Minas e Energia, 2021a; 2021b). Therefore, to in- crease its share of renewables, Brazil needs to boost the development of additional renewable sources. Sugar cane derivatives include ethanol and its ba- gasse, which is widely used for heat production in in- dustry and electricity generation. These two renew- able energy sources have been under accelerated development since the 1970s. However, other mod- ern renewables, such as wind and solar power, have only become significant to the energy matrix after the 2000s. Biomass energy production started to become a fast-growing activity in 2000, wind power in 2014, and solar in 2015 (EPE, 2021b).That was mainly due to successful policies created at that time, such as the PROINFA (Programa de Incentivo às Fontes Alternativas de Energia Elétrica, or Incentive Program for Alternative Sources of Electric Energy) renewables incentive pro- gram, the Reserve Energy Auctions (LER) for wind and long-term solar contracts, and regulations for net metering (EPE, 2021b; Lozornio et al., 2017; Silva et al., 2020). The country promotes these alternative re- newable sources to diversify its energy matrix and to reduce its dependency on traditional energy sources. From 2020 to 2030, wind power capacity is expected to grow by 202% (from 15.9 to 32.2 GW), solar power by 270% (from 3.1 to 8.4 GW), biomass by 8.6%, and distributed generation by 583% (from 4.2 to 24.5 GW) (Ministério de Minas e Energia, 2021a; 2021b).Oil and gas in Brazil Until 1997, only Petrobras was allowed to produce O&G in Brazil. When the O&G monopoly ended, the gov- ernment created public policies and subsidies to en- courage foreign companies and new players to join the market. The Repetro program was created around that time, in 1999, to achieve those objectives, and it still is one of the most influential production subsidies for the O&G industry in Brazil. The Repetro program is a special customs regime that exempts specific equipment and components for O&G activities from federal taxes,2 thus increasing the feasibility and profitability of O&G projects (CBIE, 2019; PWC, 2022; Santos & Avellar, 2017). When the pre-salt layer reserves were confirmed, the government be- came even more interested in developing the oil busi- ness and increasing its production. Therefore, new taxes were created, like special participation fees and signature bonuses, and the Social Fund was formed, in 2010, to provide resources for social development (Agência EPBR, 2021; Jesus et al., 2017; Oliveira & Laan, 2010; Pereira & Neto, 2017).Policy mixes Multiple policies that influence an energy transition comprise conflicting goals. Therefore, it is important to understand their interactions and influence on the over- all goal when studying public policies. Policy mixes are essential in studying sustainability transitions because they guide the direction and pace of the transition (Gunningham & Sinclair, 1999; Kern et al., 2019; Rogge & Reichardt, 2016). Policy mix refers to a combination of multiple policy instruments such as a country’s pub- lic policies. The policy instrument is a generic term to describe government programs, public measures, laws, regulations, and other tools used by the government to achieve strategic goals. Policy instruments can reduce taxes, directly provide resources, or indirectly mobilize other actors to spend their resources (Kern et al., 2019; Rogge & Reichardt, 2016). Examples of policy instru- ments are feed-in tariffs, carbon emissions regulations, and decarbonization credits.Renewables in Brazil Brazil has a long history of promoting the development of petroleum, biofuels, and hydropower. However, only in the past few decades the Brazilian government has made significant progress in supporting alternate re- newable sources, like solar and wind power (Lozornio et al., 2017; Oliveira & Laan, 2010; Silva et al., 2020). Brazil’s most traditional and vital renewable energy sources come from sugar cane derivatives and hydro- power. The country benefits from a large hydropow- er capacity ranked only behind China (International Energy Agency [IEA], 2022). Its land is well suited for sugar cane production, standing as the number one Many authors use policy mixes to advance research on sustainability transitions, especially on energy tran- sitions (Kern et al., 2019; Rogge et al., 2017). We use 4 BAR-Brazilian Administration Review, 20(1), e220087, 2023. A. Noguchi, F. S. Nobre Rogge and Reichardt's (2016) policy mixes framework to analyze the policies in this article. Their frame- work organizes terminology in policy mixes and offers sub-elements and categories for public policies, allow- ing a clear scope analysis. Rogge and Reichardt (2016, p. 1622) define “the policy mix as a combination of the three building blocks elements, processes and charac- teristics, which can be specified using different dimen- sions.” Elements comprise two sub-elements: the pol- icy strategy and the instrument mix. Policy strategy is divided into policy objectives and the principal plans. The first refers to long-term targets, such as Brazil’s target to achieve 10% efficiency gains in the electrici- ty sector by 2030 (International Energy Agency [IEA], 2018), while the latter indicates the general path that the government wants to take, such as the objective of Brazil’s National Energy Policy to “increase the use of natural gas” (Lei No. 9478, 1997). The instrument mix is the combination and the result of the interaction of all policy instruments of a policy mix.Policy processes subsume the policymaking and implementation pro- cesses, and the last block refers to the characteristics of the elements and policy processes: (1) the consis- tency of elements, (2) the coherence of processes, (3) credibility, and (4) comprehensiveness of a policy mix. Moreover, their framework conceptualizes dimensions to delineate the policy mix: policy field (or domain) (e.g., transport, education, energy), governance level (e.g., federal laws, state laws), geography, and (4) time. All three building blocks influence social and techno- logical change, but researchers can choose to focus on one block, a combination of two blocks, or some of their minor components. The framework helps define a focus or scope of analysis (e.g., the interaction between political processes and the policy strategy). Using this approach helps clarify the blocks, links, and scope of the policy mixes under study and avoids jeopardizing the research’s findings and validation (Ossenbrink et al., 2019). vant subjects, like political processes, disputes of power, and policy implementation. Rogge and Reichardt's (2016) policy mixes framework to analyze the policies in this article. Their frame- work organizes terminology in policy mixes and offers sub-elements and categories for public policies, allow- ing a clear scope analysis. Rogge and Reichardt (2016, p. 1622) define “the policy mix as a combination of the three building blocks elements, processes and charac- teristics, which can be specified using different dimen- sions.” Elements comprise two sub-elements: the pol- icy strategy and the instrument mix. Policy strategy is divided into policy objectives and the principal plans. Carefully choosing the boundary settings of the study is very important to research. We understood that to answer our research question and ‘draw a picture’ of the status of the transition, we needed not only to ad- dress the policies that support the renewables’ regime but also the encompassing regime (oil and gas) and the policies that support or put pressure on it. The methodology section will show how we started by defining which blocks and components of the framework we used in the research to study our boundary setting and scope of analysis properly.Then, it shows how we captured the policy instruments, plans, and strategies relevant to our scope of analysis and their characteristics (i.e., their consistency). The results, shown in the Results section, are orga- nized by the policy mix framework. We show in each table the data for each component of the framework. For example, Table 3 shows the policy objectives, Table 4 the principal plans, and Table 5 the policy instruments, and all these tables also show the characteristics. This way of presenting the results helps readers familiar with the policy mix literature assimilate the results.METHODOLOGY This article’s central question is: How do Brazil’s policies favor or hinder an energy transition of oil and gas com- panies to renewables? We answer this inquiry by devel- oping knowledge on two interwoven topics: (a) Brazil’s energy policy mixes that address O&G and renewables issues, and (b) Brazilian O&G companies’ activities and perspectives that influence the energy transition. Regarding the first topic, we conducted literature and archival research to comprehensively analyze Brazil’s policy instrument mix and its influence on the energy transition. Our analysis relied on the policy mix concept (Flanagan et al., 2011; Rogge & Reichardt, 2016) to understand not only a single instrument but also the combination and interaction between multiple policy instruments.Connecting the theoretical framework to the methodology and results Sustainability transitions occur in complex political spaces with an extensive and sophisticated network of actors, comprising technological, economic, socio-cul- tural, and institutional changes. Therefore, research- ers must eliminate irrelevant and biased elements to avoid an overly complicated and inefficient analysis. We borrowed terminology and analytical tools from the Rogge and Reichardt's (2016) policy mix framework to achieve better acceptance, validity, and uniformity, allow a more straightforward comparison of findings (Kern et al., 2019), and constitute a consistent set of in- Rogge and Reichardt's (2016) policy mix framework is used in this research because it suits the approach of studying not one but multiple policy instruments and analyzing its effects on the phenomenon of interest (i.e., the transition to renewables). The framework also allows the researchers to choose which of its blocks and components they will use or not in their research. This work allowed us to adhere only to the blocks and components relevant to study the actual status of the transition, leaving out specific elements to non-rele- Oil and gas companies — Are they shifting to renewables? A study of policy mixes for energy transition in Brazil terwoven policy blocks (Ossenbrink et al., 2019; Rogge & Reichardt, 2016). focuses on the policymaking and implementation pro- cesses. Our research question concerns the present state of the policy mix. We did not include the design features of the instruments because we did not intend to make an in-depth analysis of single instruments, but only to study their influence on each other toward the transition’s goals. Table 2 presents the dimensions used in our search for policy instruments in Brazil. We adopt- ed these dimensions because they capture the space in which interactions can occur in the scope of our re- search inquiry, which is related to the present in Brazil and is about renewables and the O&G industry. We chose to focus on the E&P segment because it is the first stage of the O&G value chain, so that it will gener- ate more activity in the following stages.We analyzed federal policies because they have the most relevance to the Brazilian energy production system, and we left other governance levels for future research. We first identified the policy mix framework’s blocks and components of our research interest. Then, we concentrated our attention on the elements — the pol- icy strategy (policy objectives and principal plans) and the policy instrument (goal, type, and purpose) — and their characteristic of consistency. To understand the combined effect of the policy in- struments on the transition of O&G companies, we an- alyzed the nature of their interactions — which can be positive, negative, or neutral. To study the interactions among the instruments and between the instrument mix and the policy strategy, we chose to analyze the characteristic of consistency because it focuses on the elements’ current state and indicates contradictions in the policy mix that make it inefficient in achieving the transition’s goals. We did not include the political processes in our analysis because this building block Table 2. Public policies’ dimensions adopted in this study.table_4the policy components and linkages within the policy mix framework as applied in this article. Guided by the public policies’ dimensions in Table 2, we conducted archival research of policy objectives, principal plans, and instruments in the context of Brazil’s energy system. We captured the policy objectives from the updated Brazilian national determined contribution (IEA, 2018). It is currently the official document that guides the national renewable energy targets, and we brought the principal policy mix plans from the National Energy Policy (Lei No. 9478, 1997). There are no feder- al-level policy objectives related to the development of O&G, only production forecasts. We searched for the relevant policy instruments on the IEA policy database. However, we also investigated government databas- es, executive reports, and strategic plans (e.g., Lei No. 9478, 1997), news, O&G private and public organiza- tions’ websites, and research institutions’ libraries (e.g., CBIE, 2019; INESC, 2020a) to learn more about these instruments and their impacts on the energy system. Our archival research found policy instruments such as the Repetro O&G tax exemption and the PROINFA re- newables programs. We then proceeded to classify all these policy instruments according to their goal, type, and purpose. Built upon the framework of Rogge and Reichardt (2016), Figure 1 presents a research design of We performed two consistency analyses to under- stand how the instrument mix contributes to our re- search question. A first consistency analysis between the Brazil National Energy Policy’s objectives and the O&G companies’ transition goals toward renewables (objective versus goals) is represented by the linkage 2 in Figure 1. A second one, between the energy poli- cy instruments and the goals of the transition of O&G companies (instrument mix versus goals), is represent- ed by linkage 3. These analyses are further examined in subsection “Energy policy mix in Brazil”. Our research question lies in linkage 1, representing the policy mix’s influence on the transition of O&G companies to renewables. A consistent policy mix can have all its objectives achieved without trade-offs.We assume that the O&G companies’ transition goals toward renewables are: (1) to reduce the efforts in O&G exploration and production (E&P), and (2) to increase renewable energy activities. They are defined as goals, not objectives because they are desired effects that contribute to the energy tran- sition’s long-term objective. We limited our research to 6 BAR-Brazilian Administration Review, 20(1), e220087, 2023. A. Noguchi, F. S. Nobre ciency and carbon capture and storage (CCS), are also important proxies for the energy transition. the E&P activities because they represent the first stage in the O&G value chain. Moreover, investments in E&P can favor progress in the subsequent stages, like refin- ing and distribution. We conducted archival research on these firms’ an- nual and strategic reports (e.g., Equinor, 2021; Petrobras, 2021; Shell, 2021; 2022). We also searched for addi- tional information on their website and the news (e.g., Reuters and the Brazilian executive magazine Exame). Furthermore, we read reports from energy and petro- leum organizations that comprise the International Energy Agency (IEA), the U.S. Energy Information Administration (EIA), the Brazilian Energy Research Company (EPE), and the ANP. We gathered relevant information about investment, property, CAPEX, and budget forecasts of renewables and E&P in Brazil, as presented in subsection “O&G companies’ activities in Brazil”. To enrich the discussion of the policy mixes, we pay special attention to one of the most controversial types of policy instruments: fossil fuel subsidies. Section “Discussion on O&G subsidies in Brazil” debates the fol- lowing question: Does Brazil still need to subsidize its O&G production? We also analyze if the tax revenues from O&G have been effective in developing the local community and addressing social issues. Regarding the second topic, we carefully ana- lyzed E&P and renewables activities of seven major O&G companies in Brazil. They are Petrobras, Equinor, Total, Shell, Galp, Repsol Sinopec, and bp. These are all publicly traded firms, and, except for Petrobras and Sinopec (from the joint venture Repsol Sinopec), they are multinational companies that originated in Europe.According to the National Agency for Petroleum, Natural Gas, and Biofuels in Brazil (ANP), this group of firms account for 95% of Brazil’s oil production (Agência Nacional do Petróleo, Gás Natural e Biocombustíveis [ANP], 2021a). It is noteworthy that this selection con- tains the O&G companies with the highest activity in renewables globally (Shell, Total, bp, and Equinor) (Pickl, 2019. We focused on renewable energy activities be- cause it is an important proxy for the energy transition, and most O&G companies that have been acting on climate issues have made some investment in this sec- tor. However, other actions, like improving energy effi- To foster our data gathering and strengthen anal- ysis, we interviewed two senior professionals in the O&G industry to capture their understanding of policies and O&G companies’ activities for an energy transition. The first interviewee is a VP of renewables at an O&G multinational operating in Brazil. The second is a se- nior researcher in petroleum politics who has worked in O&G companies in Brazil. We conducted semi-struc- tured interviews, which lasted from 30 to 60 minutes. We focused our questions to find answers to our main research inquiry: How do Brazil’s policies favor or hin- der an energy transition of oil and gas companies to re- newables? In the interviews, we focused on those two interwoven topics: (a) Brazil’s energy policy mixes that address O&G and renewables issues; and (b) Brazilian Oil and gas companies — Are they shifting to renewables? A study of policy mixes for energy transition in Brazil from interviews and secondarily from archival research, were collected between April 2021 and January 2022. O&G companies’ activities and perspectives that influ- ence the energy transition. Additionally, we built reliability in our study by as- sembling data from multiple sources. We searched for publicly available material involving written and vid- eo-recorded information from Brazilian managers and experts from these major O&G companies. The infor- mation included interviews, webinars, and workshops delivered and recorded for the 2019, 2020, and 2021 Rio Oil and Gas Congresses, and publicized by epbr agen- cy and other O&G related institutions.These multiple data sources added information to our study especially on what those major O&G companies are doing re- garding the energy transition in Brazil. All data, primarilyRESULTS AND ANALYSESRESULTS AND ANALYSES Energy policy mix in Brazil We started our analysis with the two components of the policy strategy: the policy objectives (Table 3) and the principal plans (Table 4) of Brazil’s energy policies. They were retrieved from Brazil’s Nationally Determined Contribution (NDC) (IEA, 2018) and the National Energy Policy (originally described in the Brazilian Law No. 9,478 from 1997) (Lei No. 9478, 1997), respectively. Then, we classified them regarding their consistency with the goals of the assumed transition of O&G companies to renewables (described in the Methodology section). Table 3. Consistency of Brazil’s policy objectives for energy with the transition’s goals.table_5Note. Source: The authors, with data from IEA (2018).Table 4. Consistency of Brazil’s principal plans for energy with the transition’s goals.table_6newables in the Brazilian energy matrix. Therefore, there are no contradictions with the transition’s ob- jective of increasing renewables activity by O&G com- panies. Nevertheless, there is a contradiction in the transition’s objective of reducing E&P activity with the energy policy’s objective of increasing the use of nat- ural gas. As for the objective of ensuring the supply of petroleum products, it is not necessarily a trade-off with the reduction of activity in E&P, as a reduction can occur, and the supply can still be guaranteed, so we defined it as neutral. With this consistency analysis, we conclude that most policy objectives and principal plans of Brazil’s energy policy align with the transition. The policy objectives (Table 3) are all consistent with the transition’s goals, which is no surprise since they were presented in Brazil’s NDC, which is a document that contains plans for climate action. Despite having some policy instruments with goals for O&G develop- ment, Brazil has no quantifiable objectives for this ac- tivity as the country has for renewables. The Program for the Revitalization of Onshore O&G (REATE), for ex- ample, has a goal to achieve 500 mboe/d by 2030, but this is an instrument goal, not a policy objective, so we did not include it in our tables. As for the analysis of the principal plans (Table 4), most of the objectives of the National Energy Policy aim to increase total production and the share of re- 8 BAR-Brazilian Administration Review, 20(1), e220087, 2023. A. Noguchi, F. S. Nobre For the second consistency analysis, between the in- strument mix and the goals of the transition, we present all the policy instruments relevant to renewables and E&P found in our archival research from the IEA policy data- base and other complementary sources. We sorted them according to their consistency to the goals of the transi- tion. Table 5 shows all the instruments consistent with the transition, and Table 6 shows the ones that are not. All the instruments were classified as per Rogge and Reichardt (2016) categorization of primary type and purpose. Table 5.Group of policy instruments promoting renewables (consistent with the transition Table 5. Group of policy instruments promoting renewables (consistent with the transition).table_7Note. Source: The authors. Table 6. Group of policy instruments promoting E&P (inconsistent with the transition).table_8many inconsistencies with the goals of the transition for it has many instruments aiming to promote O&G. One of the interviewees, the oil company VP, said that “the oil business would secure our income while our company shifts to renewables,” supporting that in- struments that promote O&G may indirectly favor in- vestments in renewables by O&G companies. In line with that view, the other interviewee said that O&G many inconsistencies with the goals of the transition for it has many instruments aiming to promote O&G. Analyzing the instrument mix against the transition goals, the group of policy instruments promoting re- newables (Table 5) has synergy with the transition’s goal of increasing renewables activity. In contrast, the group of policy instruments promoting E&P (Table 6) conflicts with the goal of reducing activity in E&P. Differently from the policy strategy, which has a good alignment with the transition, the instrument mix has One of the interviewees, the oil company VP, said that “the oil business would secure our income while our company shifts to renewables,” supporting that in- struments that promote O&G may indirectly favor in- vestments in renewables by O&G companies. In line with that view, the other interviewee said that O&G Oil and gas companies — Are they shifting to renewables? A study of policy mixes for energy transition in Brazil E&P may indirectly allow more investments in renew- ables by these firms. companies have had “waves” of investment in renew- ables in the past, and all these waves happened in peri- ods of high oil prices, and they ended when the oil cri- ses came. This statement supports the idea that higher profitability in O&G activities motivates O&G compa- nies to invest in renewables; thus, policies supporting Table 7 presents some of the key interviewees’ per- spectives about the factors that slow down the most the energy transition from O&G toward renewables in Brazil. Table 7. Interviewees’ perspectives on policy features that hinder the energy transition from O&G to renewables in Brazil.table_9Note. Source: The authors.O&G companies’ activities in Brazil According to the energy policy and Brazil’s Decennial Energy Plan (Ministério de Minas e Energia, 2021a; 2021b), from the Ministry of Energy, the core energy fuels for Brazil will still be hydropower, biofu- els, and petroleum products in the 2021-2030 period. Other renewables and natural gas are considered com- plementary fuels to the core ones, but the government still promotes them. The strategy for Brazil’s energy pol- icy is not to transition from fossil fuels to renewables, as there is no policy instrument to limit or reduce E&P ac- tivity. Still, it is part of the strategy to increase the share of renewables in the energy matrix. O&G companies’ activities in Brazil Figures 2 and 3 present time distributions of the history of acquiring new O&G exploratory blocks in ANP bid- ding rounds for the seven selected major companies. Exploratory blocks are demarcated areas that are po- tentially abundant in O&G resources, so they are sold from the government to O&G companies for explora- tion and production rights. Figure 2 presents Petrobras’ data, and Figure 3 presents the other six O&G compa- nies (Equinor, Total, Shell, Galp, Repsol Sinopec, and bp). Each bar in the graphs shows the sum of partici- pation shares that were acquired by those companies altogether in that year, where 100% is equivalent to an entire block, and 500% mean, for example, a total of shares equivalent to five blocks. Exploratory blocks do not have the same size or the same potential for O&G production, but we do not make distinction regarding these characteristics in this analysis. The period con- sidered is from 2000 to 2021 (bidding rounds started in 1997). These distributions are based on the ANP database (Agência Nacional do Petróleo, Gás Natural e Biocombustíveis [ANP], 2021b) and represent an im- portant indicator of future E&P activity because if com- panies have purchased O&G blocks recently, they will develop them. Therefore, they are likely to produce O&G for decades. Proposition 1.A policy mix with a policy strategy aiming to increase the share of renewables will be inefficient (in achieving this objective) if the policy mix has inconsistent policy instruments favoring progress in O&G. Proposition 2. The lack of infrastructure, proper regulations, legal frameworks, and federal agencies for renewables holds back foreign investment in re- newables in emerging countries, hindering a sus- tainability transition by O&G companies. Proposition 3. If not supported by incentives and a fair taxation system, renewables will remain as sec- ondary energy sources to fossil fuels in emerging countries that subsidize O&G. We analyzed the acquisition rate of blocks per year of each company. Dividing the average of 2015-2021 and 2000-2021, we found the following: Galp (0.46); Petrobras (0.63); Total (0.68); Shell (1.53); bp (1.80); A. Noguchi, F. S. Nobre nies have increased their acquisition rates in the last six years compared to the average of the last twenty-one years (i.e., a result higher than 1.0). Equinor (1.88); and Repsol Sinopec (2.74). This calcula- tion allowed us to compare the recent acquisition rate with the historical average. Four of the seven compa-table_10table_11keep developing their blocks, like Bacalhau and BM-C- 33 for Equinor and Pau Brasil for bp. Although these companies do not show signs of reducing their E&P activity in Brazil in the next few years, most of them are increasing their renewables activity. Petrobras, Shell, Total, Equinor, and bp all have renewable energy as- sets already producing in Brazil, like biofuels, biogas, onshore wind, and solar power. Shell and bp are nota- ble for ethanol production through joint ventures (with Raízen and bp Bunge, respectively). In solar and wind, Petrobras, bp, Total, and Equinor are already produc- ing significant amounts of energy. Repsol Sinopec is the only one of the seven companies considered here that do not have any renewable’s activities in Brazil (BP, 2021a; 2021b; Equinor, 2020; 2021; 2023; Galp, 2021b; Petrobras, 2021; Repsol, 2021; Shell, 2022; Total Energies, 2021b). Table 8 presents a summary of the O&G companies’ renewables activities in Brazil. When asked if O&G companies are transitioning to renewables or if they are trying to maintain the status quo, both the interviewees said that, in their opinion, the current focus of these companies in Brazil right now is O&G. “Honestly, the focus of O&G companies in Brazil to- day is to make money with fossil fuels. They have invested a large amount of money in Brazil buying fields, including Shell, Equinor, and CNOOC. They’ll want a return on their investment.” (Interviewee — oil company VP). Galp has announced a target to increase by 25% its oil production in Brazil by 2025 (compared to 2021) (Siqueira, 2021). Total has a target to reach 150,000 boe/d, 150% more than 2021 (Total Energies, 2021a). Other companies did not inform a target, but they will BAR-Brazilian Administration Review, 20(1), e220087, 2023. Oil and gas companies — Are they shifting to renewables? A study of policy mixes for energy transition in BrazilTable 8. Summary of activities in renewables for the O&G companies in Brazil.table_12It is important to note that O&G companies are rel- evant players in the renewables market. For example, in the ethanol market, Shell’s joint venture with Raízen is the largest producer in Brazil, while bp Bunge is in the top four (UDOP, 2020), and Lightsource bp has a mas- sive capacity of 2.2 GW from solar power. As we see that O&G companies in Brazil continue to make huge investments in the O&G business, even with the exis- tence of various instruments favoring renewables, we propose that: that the government does not efficiently use O&G tax- es, and they failed to significantly change the situation of the poor in Brazil. Fossil fuel subsidies are significant barriers that hin- der the world’s energy transition toward renewables. On one side, typical justification for them comprises poverty alleviation, industrialization growth, and eco- nomic development (Cheon et al., 2015; Rentschler & Bazilian, 2017). On the other side, they generate un- desired effects such as increased carbon emissions, increased energy demand, and unsustainable fiscal burdens for governments (Moghaddam & Wirl, 2018; Oliveira & Laan, 2010; Timperley, 2021). In 2009, G20 countries (including Brazil) committed to phase out fossil fuel subsidies and reform inefficient subsidies. Although these countries still spend hundreds of mil- lions of dollars annually on it, many oil-exporting coun- tries successfully reform and reduce their fossil fuel subsidies, like India, Iran, and Mexico (Mason & Ennis, 2009; Moghaddam & Wirl, 2018; Rentschler & Bazilian, 2017; Timperley, 2021). Proposition 4. Inasmuch as an emerging country (like Brazil) has no plans or policies to phase out O&G production, O&G companies will continue produc- ing O&G for the next decades on a large scale.DISCUSSION ON O&G SUBSIDIES IN BRAZIL The purpose of this section is to discuss if Brazil still needs to subsidize its O&G production and if the tax revenues from O&G have been effective in developing local communities and addressing social issues. There are subsidies for production and for con- sumption of fossil fuels, and Brazil has both. On the one hand, consumption subsidies aim at reducing the final price of fuel for end users and to promote industrializa- tion by supporting energy-intense industries with low- er energy costs (Moghaddam & Wirl, 2018; Rentschler & Bazilian, 2017; Oliveira & Laan, 2010). On the other hand, production subsidies are meant to encourage com- panies to increase their production of fossil fuels, and they usually increase the profit for producers (INESC, 2020a; Timperley, 2021; Zhao et al., 2019). As this ar- ticle is about policies that affect E&P, we are especially interested in discussing production subsidies. There has been little progress in reforming this type of subsidies, and they have received much less attention from re- searchers than consumption subsidies (Rentschler & Bazilian, 2017). Fattouh et al. (2018, p. 5) argue that for oil-export- ing countries “there is no conflict between renewable investment and hydrocarbon business in these coun- tries” because with the increase of renewable energy domestic production, these countries are allowed to export more O&G. This may make sense in an econom- ic view, but in an environmental point of view, expor- tation of O&G still hinders the global efforts for climate action. The interviewed petroleum politics researcher said, “each country will make the energy transition that it can afford.” She argued that Brazil has poverty and inequality issues that developed countries do not have, and the tax revenues from O&G could change that. She said that Brazil’s strategy for an energy transition could be to maintain and subsidize the O&G business. At the same time, the government can focus on reduc- ing emissions in other areas, like energy efficiency and deforestation. As an illustration case, Hogarth (2016) showed that Brazil could decrease its GHG emissions significantly by reducing deforestation.Still, she agrees Most authors and organizations define subsides as the tax and financial policy instruments that directly reduce the price of fossil fuels for consumers or the production cost for producers (Coady et al., 2010; BAR-Brazilian Administration Review, 20(1), e220087, 2023. 2 BAR-Brazilian Administration Review, 20(1), e220087, 2023. A. Noguchi, F. S. Nobre INESC, 2020a; Timperley, 2017; Timperley, 2021), and by this definition, only the Repetro program and the Act No. 13,586/2017 are considered production subsidies among all the listed policy instruments in this study. & Neto, 2017; Poubel & Santos-Junior, 2017). Jesus et al. (2017) have studied the five cities in Brazil that are most dependent on the revenue from O&G and concluded that, in the period of 2005 to 2015, social inequality in- creased in all the five cities, and in some of these cit- ies the educational and violence levels became worse. According to Oliveira and Laan (2010), poor families did benefit from subsidies in Brazil in the last decades, but the large industrial energy consumers were the ones benefited the most, while the common taxpayers are the ones that paid for all that. Even though fossil fuel subsidies are usually justified as a support to the poor, many times most of the subsidies are received by the rich, who tend to consume proportionally more energy than the poor population (Cheon et al., 2015; Rentschler & Bazilian, 2017). According to the Institute of Socio-economic Studies (INESC) (INESC, 2020a; 2020b), the cost of fossil fuel production and consumption subsidies in 2019 for the Brazilian government were R$ 36.27 billion (US$ 7.10 billion) and R$ 63.01 billion (US$ 12.6 billion), respective- ly. The cost of production subsidies came mostly from foregone tax revenues for O&G from Repetro program (77%) and Act No. 13,586/2017 (17%), while 83% of the cost of consumer subsidies came from diesel and gas- oline tax reductions. Does Brazil still need to subsidize its O&G produc- tion?Rentschler and Bazilian (2017) have analyzed sub- sidy reforms in many countries, and they argue that “in practice, the key rationale for implementing subsidy re- form has typically been fiscal rather than environmen- tal” (Rentschler & Bazilian, 2017, p. 2). They still add that “the necessity and urgency of reform can only be fully understood when considering the complete range of adverse environmental, social and economic side ef- fects of fossil fuel subsidies” (Rentschler & Bazilian, 2017, p. 2). If not for environmental reasons, leaders can re- form their subsidies for the benefit of their economies in the long-term. When the Repetro program was created in 1999, it was supposed to develop the market and to expire in 2020. Whether Repetro was responsible or not, its goal to develop the industry and to bring new players to the market was certainly achieved. In 1997, Brazil’s to- tal petroleum production was almost 1 million boe/d,3 and in January 2022, the daily production was around 3.8 million boe/d, being 74% of that production derived from the pre-salt area and coming from many new players in the market other than Petrobras (Agência Nacional do Petróleo, Gás Natural e Biocombustíveis [ANP], 2022b; Agência EPBR, 2021). With such accom- plishments, one could say that O&G would not need production subsidies after 2020 (when Repetro should expire). Still, in 2018, the government extended the scope of the Repetro program and its validity to 2040. The government’s rationale behind this decision was that the subsidy would continue to promote new in- vestment, increase the country’s competitiveness, and bring more players to the market (Brasil, 2017). As an economic justification to reform the sub- sidies, the INESC institute (2020a) claims that tax re- nounce from production subsidies largely reduces state revenues that are essential to the Brazilian popu- lation, like PIS (Social Integration Program) and COFINS (Contribution to Social Security Financing), which are fundamental for state pension and unemployment insurance. Dr.Fernanda Delgado de Jesus, petroleum politics researcher in Brazil, highlights that “all public policies need to be measured,” and even though the production subsidies for O&G are costly, they bring large economic benefits to the population through royalties, special participation fees, and signature bo- nus, and many cities rely upon these taxes, so the pos- itive effects from these subsidies must be considered (Núcleo WIN Brazil UFBA, 2021, 1h12m). In 2021, the O&G business in Brazil distributed R$ 37.6 billion (US$ 7.5 billion) in royalties and R$ 36.8 billion (US$ 7.3 billion) in special participation fees for the government, and part of this revenue is expected to be used in basic services, such as health and education (Agência Nacional do Petróleo, Gás Natural e Biocombustíveis [ANP], 2022a). Studies have shown that the government revenue We conclude that this subsidy’s main goal is not to support a nascent industry, but to continually increase its production and have economic benefits. While Brazil may have been successful in its economic objectives for the pre-salt, we cannot say the same for the social development goals on poverty alleviation and inequal- ity reduction. Indeed, business cases that prioritize short-term economic decisions will be disconnect- ed to the long-term societal and environmental out- comes (Hahn et al., 2018). In section “Energy policy mix in Brazil”, we showed that Brazil’s energy policy mix has a policy strategy highly oriented to the progress of re- newables, but it includes many O&G policy instruments that are inconsistent with it. In section “O&G companies’ activities in Brazil”, we show data from O&G compa- nies supporting that the O&G instrument mix has been successful in its goals of developing the O&G industry. Studies have shown that the government revenue from the O&G has failed to significantly reduce poverty and to improve the educational levels in cities that re- ceive royalties from O&G (Martinez & Reis, 2016; Pereira BAR-Brazilian Administration Review, 20(1), e220087, 2023. Oil and gas companies — Are they shifting to renewables?A study of policy mixes for energy transition in Brazil and removal of subsidies for fossil fuels while creating more subsidies for renewable technologies that are still not competitive, like second-generation ethanol and offshore wind — following Cheon et al. (2015) and Rentschler and Bazilian (2017). In this section, we present a line of though suggest- ing that, although O&G instruments have achieved its short-term economic goals, they have failed to achieve social goals. As they also hold back the transition to renewables, they might not be beneficial to society in the end. The literature shows that subsidizing O&G is not efficient for the economy or social development in the long run. Fossil fuels subsidies may create short- term stimulus for the economy, but they normally cause detrimental effects for sustainability issues in the long-term.4 They incentivize growth in energy consumption and discourage energy efficiency and low-carbon energy sources (Oliveira & Laan, 2010; Rentschler & Bazilian, 2017). Researchers showed that there are more efficient manners for a government to spend money to alleviate poverty than subsidies, such as direct cash transfer programs or investment in basic services for the population, and that is a major sup- porting argument for eliminating them (Cheon et al., 2015; Jain, 2019; Moghaddam & Wirl, 2018; Rentschler & Bazilian, 2017). According to Cheon et al. (2015, p. 376), the subsidies for fuel in Brazil “encouraged ex- cess and inefficiency and benefited industries more than they did low-income households, widening the gap between the wealthy and the poor.” Proposition 5. Policy instruments that artificially lower the production cost of O&G reduce the com- petitiveness of renewables and discourage invest- ment in low carbon technologies, thus hindering a sustainable energy transition.CONTRIBUTIONS AND FINAL REMARKS One of the main expectations of the current global energy transition is to reduce GHG emissions from energy use radically. A clean transition will be done by quitting fossil fuels and replacing them with re- newables and electrification. Brazil is ahead of most countries regarding total use of renewable energy, with a vehicle fleet that can run almost entirely with biofuels, a meager share of coal, and most of its elec- tricity coming from hydropower (EPE, 2022). Unlike most developed countries, Brazil’s GHG emissions do not come from energy use. Instead, they come pri- marily from land-use change and the forestry sector (Timperley, 2018). All these facts must be understood by the popu- lation and the political parties to avoid opposition to subsidies reforms. Politicians must clearly communi- cate the population what is being done to compen- sate the removal of subsidies and what are the long- term benefits. Society must understand that the extra revenues will be used in their benefit in more efficient manners, like cash transfer or social programs. The short-term fiscal benefits are exchanged for a long- term economic development. Not to say the environ- mental reasons. It is also important to create mech- anisms that will protect the most vulnerable citizens from high prices, as the poorest cannot wait for long- term returns (Jain, 2019; Rentschler & Bazilian, 2017). Brazil’s public policies seem to favor O&G more than renewables as the petroleum segment has more political benefits than other energy sources. Petroleum has federal institutions to coordinate the market (e.g., ANP and the Secretary of Petroleum, Natural Gas and Biofuels — SPG), a mature regulatory framework, tax benefits (e.g., Repetro and Act No. 13,586/2017), fi- nancing programs, and R&D mandates. Petroleum does not have infrastructure limitations for distribu- tion as other sources like biogas and electricity. According to Rogge et al. (2017, p.2), transforma- tive policy mixes for sustainability transitions “need to combine different instruments addressing multiple market and system failures by fulfilling different pur- poses, such as technology push and demand pull.” In order to speed up investments in renewables in Brazil and similar emerging economies, the authors recom- mend that public policies should include: (a) regu- latory frameworks for all renewable energy sources, which will allow developments in new projects, pre- dictability for investment, and a competitive ener- gy market; (b) regulatory agencies for all renewable energy sources; (c) established plans for the energy sector, which will guide the creation of new policies and instruments; (d) policies to speed up the develop- ment of infrastructure for energy; and (e) restrictions As for the main theoretical contributions of this article, we empirically studied how the interplay be- tween building blocks of policy mixes (in this case, the elements and the consistency characteristics) affects the effectiveness of policy mix in directing a change toward sustainability objectives (i.e., the shift of O&G companies toward renewables). We validated the link- age between consistency, policy strategy, and the in- strument mix of Rogge and Reichardt's (2016) frame- work in an empirical study in an emerging economy. Therefore, we expanded the geographical scope of policy mixes and sustainability transitions previously applied to European studies (Ghosh et al., 2021; Rogge et al., 2017) to a significant emerging country. BAR-Brazilian Administration Review, 20(1), e220087, 2023. A. Noguchi, F. S. Nobre We identified some limitations in our work but that open new fruitful opportunities for future research. First, our scope of analysis is limited to national-lev- el policies and the E&P segment only. There are also important policy instruments at the state government level and policies for other oil and gas segments that can largely influence our research question, for ex- ample, tax reduction on fuel price for end consumer policies and some local incentives for E&P and renew- ables. Second, we analyzed the consistency among the policy instruments.Nevertheless, Rogge and Reichardt (2016) show that other characteristics and design features of policies (like comprehensiveness, credibility, coherence, stringency, and depth) are in- fluencers of the policy mix toward its goal. Therefore, these unexplored elements are subject to further re- search to encompass a more holistic perspective of the problem. Third, we focused our analysis on the shift of O&G companies from E&P to renewables, and there is space for a broader analysis of all the other actions that these companies have done regarding the energy transition, like energy efficiency, increase in natural gas use, CCS, and carbon offset measures. Petrobras, for example, has a clear strategy to focus its energy transition actions on these later technologies, and not on renewables. 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