Biomass market trends and bioenergy sector views on EU

State of play on the sustainability of biomass used in EU

The usage of biomass for the purpose of heating and cooling has experienced a significant rise since 2005. These estimates were given by the National Renewable Energy Action Plans. The usage of biomass as a source of power is expected to rise morez from 86.5 mln tones to 101.5 mln tones in 2020. Analysts state that by the end of the decade the main aims for the usage of biomass will be heating and electricity.

Solid biomass and its gaseous form, which particularly consist of wood and wood wastes, are expected to become the most important and the most used sources of renewable energy in the EU. These sources are also supposed to make the most important contribution to the 20% EU renewable energy aim in 2020. Sustainable biomass can solve a great range of environmental problems. This means that coherent and rational usage of biomass may become the key way of resolving climatic problems and avoiding striking climate changes. On the other hand, sustainable biomass will provide sustainable economic growth and development in the European countries in the future.

Biomass can also assist in energy security of the EU, because the biggest part of the demand for biomass is satisfied through domestically produced raw materials and import is provided from various sources. In case of additional biomass production a lot of other branches will participate in biomass production process and will receive stable incomes. The process will also demand participation of numerous rural area workers, farmers and owners of the forest. The European sectors which are involved in bioheat and bioelectricity production have a total turnover of EUR 33 billion and more than 374,000 people working in this sphere.

Biomass in its solid and gaseous form is an effective source of energy. The EU realized this fact today and carries on using bioenergy more and more. Biomass is the biggest and the most acceptable source of renewable energy for today and it continues to be the key aspect of achieving the goals introduced by the EU for the 2020. Furthermore, biomass is viewed as the main way of 2050 long-term decarbonization plan.

Bioenergy

Nonetheless, numerous amounts of stakeholders express their concerns regarding potential sustainability risks which may appear in connection with wide-spread and large-scale usage of biomass for the energy production, including those which stem from the imports from third world countries. Whereas analysts estimate biomass imports to triple between 2010 and 2020, the main biomass production will still take place predominantly in the EU, and the biggest part of bioenergy production demand for raw materials will be met domestically.

Moreover, it should also be mentioned that currently a limited number of Member states adopted the required legislation which includes broadly consistent sustainability schemes. That is why no apparent barriers for the internal market have been identified so far. Nonetheless, it is believed that the EU tool on technical standards may address all the existing problems concerning the risk which comes from market distortion which can be caused by national sustainability regulations.

Biomass usage in EU

The technologies for producing heat and cooling from biomass are quite developed in many fields of application. The systems which work on biomass and provide heating and power range from small stoves for households to great biogas plants. The power capacities of small-scale stoves can be variable, from 5 kilowatts (kW) to 100 kW (they often run on wood pelletsor on wood logs). Larger-scale boilers are often used for industrial aims, farms, commercial buildings and so on. They are able to reach the capacity of 100kW to 500kW (running on numerous raw materials such as wood chips and miscanthus). The most powerful biomass systems are supposed to be large heating plants which are predominantly used for district heating or for industrial purposes and have the largest power capacities in the range of 1MW to up to 500 MW (they are capable of using the wide range of biomass raw materials such as wood chips, straw and miscanthus).

Another important process which helps to produce bioenergy is anaerobic digestion. This is the conversion of organic raw material to biogas. In the absence of air biomass turns into methane-rich biogas. This technology is appropriate for wet agricultural biomass such as manure, crops, and crop residues. The above mentioned biogas can be used for local heating, district heating as well as heat and power production in small boilers, combustion engines and gas turbines. Moreover, biogas may be converted into a gas of much higher quality, to be injected into the natural gas network as biomethane.

Biomass can also be used for heat and power production in cogeneration plant. These systems are also called combined heat and power plants. The proportion of produced electricity and heat is approximately 1:2 or 1:3 with possible overall efficiency. As a rule, CHP demands a bigger amount of investments than the installations which exclusively deal with heat production. That is why it is important to find a perpetual heat demand to make the investment into such plants rational. CHP plants are mostly viable when used in industrial operations such as paper production, because this process demands a significant amount of heat. Biomass CHP plants are widely used in the EU member states situated in the north and in the west, where they have developed district network for the provision of heating as well as high demand for the supply of the resources caused by the relatively climatic conditions in winter.

From the financial point of view, the most effective decision for the electricity production is co-firing and fossil-fired power production plants. Co-firing is a process when several types of fuels are fired together in order to produce energy in the most economically as well as energetically viable way. Thus, the mass part of biomass constitutes 10%. This approach demands using the coal plant infrastructure and investments in biomass are not too high. Furthermore, this approach opens new prospects for the full conversion of coal plants into plants which entirely work on biomass.

Permitting of Bioenergy installations in the EU-27

These recommendations were made basing on the research of 130 real biomass installations cases. The recommendations were set for NGOs as well as for permitting authorities.

Installations working to produce bioenergy are able to make prominent contributions to the local economy. These installations are also meant to improve the regional, national and European CO2 emission situation and meet expected renewable energy targets. Thus, the construction of the installation shall be analyzed on the local, regional and national level. In case of any suspicions concerning the effects on the environment the organization should contact the project developer in order to find out joint solutions. This may lead to the settlement of the problem.

The key issue, which is important for the environment, is the sustainability of the raw material used for the production of bioenergy. If there is no information about the feedstock precedence, a NGO should contact project developer to get further information about the given raw material.

The NGOs should also find more details on the technology which will be used for bioenergy production and get detailed information from project developers. In case of unjustified resistance from some organizations, a NGO should make it clear that bioenergy installation poses no threats for the society and environment.

First of all, the authorities which permit installations should take into account the experience of other authorities which have already dealt with such problems. Secondly, the permitting authorities need to organize coordinated cooperation in order to find the best solution for the issue of bio-energy plant installation. The authorities should also issue a set of required criteria for the installation.

In order to increase the amount of the required information the authorities may also organize the in-house board of experienced employers who have already taken place in permitting procedures and can give substantial information in terms of the issue. Such networks of experienced insiders may be also organized on the regional and even national levels.

Biomass

2030 renewable energy Strategy in EU

The EU countries worked out the new program for climate and energy in 2030. The targets they set will help them to achieve newly-minted reformed energy system which will bring more sustainability, security and competitiveness in energy issues. Moreover, the usage of renewable energy will assist in meeting long-term 2050 greenhouse gas reduction plan. The main decarbonization effect will be attained by shifting the energetic priorities of the system and providing more investments into low-carbon technologies.

First of all, the European government is deeply concerned about carbon emissions. They set the target to reduce greenhouse gas emissions by 40% as compared to the 1990s. They see the future in renewable energy sources.

The most outstanding target set at EU level is at least 27% consumption of energy from renewable energy sources in 2030.

By 2020 the target set is 20% of final energy consumption from renewable sources. The European countries are obliged to have at least 10% of their transport fuels coming from renewable sources. All countries adopted renewable energy action plans particularly made for each country. These plans include targets for the usage of renewables for heating and cooling as well as electricity production.

Renewables will play the most important role to meet the energy needs of Europe beyond 2020. The government has also decided that support schemes are vital to make particular renewable energy sources competitive.

The EU has the biggest part of renewable technologies in the world. 40% of the world’s renewable energy patents belong to Europe and almost half (44%) of the world’s renewable electricity power sources were located in the EU. About 1.2 million people in the EU have working places in the renewable energy industry.

Europe in the global wood pellet sector

EU is supposed to be the largest wood pellet producer, reaching the number of 13.5 mln tones of the produced product in 2014. In terms of percentage points, around 50% of the world wood pellet production comes from Europe. Moreover, the European wood pellet production sector experienced a significant 35% increase from 2010 to 2014. The general slowdown of the heating market in Europe caused by mild climatic conditions in winter and low oil prices is a challenge for wood pellet sector. Nevertheless, according to the 2014 estimates, the sector experienced a seven-time increase over the last decade, producing 27 Mln tones of wood pellets.

Market

Besides, the amount of wood pellet production in the EU differs drastically from country to country. The biggest producer of the above mentioned product remains Germany. The country manufactured 2.1 million tons in 2014. The second biggest European producer of wood pellets is Sweden, which produced about 1.6 million tons and Latvia, which experiences remarkable production increase with more than 1.3 million tons.

The usage of wooden pellets for heating is also a very powerful sector in Europe today. The sector increases constantly showing 25% growth between 2011 and 2014. The EU wood pellet market shows sustainability having no concrete policy schemes. One should take into account that this sector is very weather dependent. The second factor which is a barrier for the development of the market is low price for fossil fuels and the emergence of other heating technologies. As in the case of wood pellet producing, wood pellet usage also differs from country to country. Italy is the biggest consumer of pellets (2.9 mln tons). Germany and Sweden are the second and the third pellet users in Europe. Europe is also the biggest world pellets consumer.

Ongoing studies concerning biomass sustainability

The studies are conducted by the European Union and by the NGOs

1) Resource efficiency impacts of future EU bioenergy demand (ReceBio) is an analysis initiated and run by DG Environment of the European Commission. The study helps to find out detailed information about potential interactions and influences caused by the intensive usage of biomass in Europe.

2) Carbon Impacts of biomass produced in the EU studies and evaluates the possible amount of greenhouse gas emissions caused by the intensive usage of biomass for heating, cooling and electricity production.

3) Optimized cascading use of wood is the study which analyzes the reduction of wood usage and its economic and environmental effects.

4) Imports from North America studies the impacts caused by potential growth of biomass imports from North America.

The three main studies concerning biomass usage in Europe are conducted by such NGOs as Birdlife, EEB, WWF, Greenpeace and others. They have the next objectives: clarifying the impact of biomass usage and climatic changes between 2020 and 2030. Moreover, these organizations question the carbon neutrality principle of biomass and find out more information on carbon emissions caused by biomass. They also encourage cascade usage of biomass.

The role of bioenergy

In order to provide coherent biomass usage, one should consider viable heating and cooling strategies. First of all, the authorities should implement such economic incentives as carbon tax on fossil fuels, attractive funding and loans, social stimuli to make biomass usage popular with the members of the society. Secondly, different awareness campaigns should be conducted, which will make clear the economic and climatic reliability of the biofuel. Moreover, additional local feedstock productions should be supported and government obligations to use renewables in newly built houses should be implemented These steps are the key ones to improve the situation.

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The prices for wood pellets increased by 0,8 per cent in February 2015


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