SAO PAULO (Reuters) - Brazil's greenhouse gas emissions (GHG) fell 4.9 percent in 2012 as declining deforestation rates and a drought-induced drop in cattle herds outweighed increased emissions from the energy sector, an independent study showed on Thursday.

The nation's output of heat-trapping gases, which are blamed for climate change, hit 1.484 billion tons of carbon dioxide equivalent (CO2e) last year, according to Climate Observatory, a network of nongovernmental organizations that includes World Wildlife Fund, Conservation International and Greenpeace.

Due to the steep fall in deforestation - which had been so large it sent Brazilian GHG emissions to a peak of 2.856 billion tons of CO2e in 1995 - Latin America's largest economy will have an increase of 6.6 percent on emissions from 1990 to 2012, while the world's concentration of GHGs increased 37 percent in that period.

But those behind the study said the trend is insufficient to tackle climate change and that the country should go beyond combating deforestation to address aspects such as the huge increase in fossil fuels consumption.

"The relatively successful policy on deforestation and the hydro-based energy matrix that Brazil always had have prevented the country from seeking innovative policies on climate change," said Carlos Rittl, executive secretary of the Climate Observatory.

"More than 70 percent of all investments planned in the energy sector in Brazil in the next 10 years will go to fossil fuels. And that could increase if possible shale gas projects are given the green light," said Rittl.

Brazil recently discovered some of the world's largest oil and gas reserves along its coast, and the government plans to rapidly tap the resources.

The study covers Brazilian emissions year by year since 1990 and is intended to be updated annually. (

"Governments in general take a long time to release GHG emissions estimates, normally more than three years. It is difficult to react with new public policies when you have such a gap on information," said Tasso Azevedo, the project's chief researcher.

"We want to make sure there will be consistent data, every year, on a transparent way," he said.

Brazil ranks seventh among the largest emitting countries in the world but still leads emissions on land-use change (deforestation) and is the fourth largest in emissions from the agricultural sector.

Emissions from the energy sector, for example, increased 126 percent since 1990, reflecting a larger use of thermal power plants and growing amounts of fossil fuels to move an ever larger fleet of cars and trucks.

From 2009 to 2012, emissions from gasoline consumption in Brazil jumped 64 percent, as government policies to hold its price to combat inflation sent cane-based ethanol basically out of the market.

Greenhouse gases from agriculture jumped 45 percent between 1990 and 2012, mainly due to the strong adoption by farmers of nitrogen fertilizers that helped Brazil sharply expand grains production.

The study cost $290,000 to produce and was financed by the Oak and the Avina foundations, the Climate and Land Use Alliance and the Latin American Climate Initiative.

(Reporting by Marcelo Teixeira; Editing by Ben Garside and Jeffrey Benkoe)