Biomass Power Market Trends

Global Biomass Power Market Synopsis:

Biomass Power Market was valued at USD 132.19 billion in 2023. Biomass Power Market will be Worth from USD 137.81 Billion by 2024 to USD 224.16 Million by 2032 registering a CAGR of 5.55% during the forecast period 2024-2032. Biomass fuel is a renewable energy source derived from organic materials. 

It is a renewable and sustainable form of energy used to create electricity and other forms of power. In the biomass power plant, wood waste and other wastes are burned to produce steam, which runs a turbine to make electricity. Using this one can provide heat to homes and industries.

Source: Secondary Research, Primary Research, MRFR Database and Analyst Review

Moreover, innovative technologies such as pollution control and combustion engineering have advanced to the point that any emission from burning biomass in industrial facilities. The decline in demand resulted in less use of fossil fuels, and more renewable use in the generation stack during COVID impacted the market. 

The rising energy and power demand and increased demand for clean energy will positively impact market growth. The high operating costs and the increasing capital cost in economically growing countries will hamper the Biomass Power Market growth in the forecast period.

In February 2024, Seiko Epson Corporation publicly announced that it would construct its first biomass power plant in Iida City, Nagano Prefecture, Japan. The company plans to complete the construction of the plant by 2026, targeting the ambition of becoming carbon-negative by allowing renewable power to be used in its decarbonization efforts.

Biomass Power Market Key Players:

List of the prominent companies operating in the global biomass power market are

Babcock & Wilcox Enterprises, Inc., (US), Mitsubishi Heavy Industries, Ltd. (Japan), Suez (France), Orsted A/S (Denmark), Amerseco Inc (US), Licella Holdings Ltd (Australia), Xcel Energy Inc (US), VEOLIA (France), Vattenfall AB (Sweden), and Ramboll Group A/S (US).

Recent development in Biomass Power Market:

April 2022

• Greencoat Capital, on April 28, announced that funds managed by the company had acquired the Margam Green Energy Plant, a 41.8 megawatt (MW) waste wood-fired biomass plant located in the U.K., from Glennmont Partners.


• The trading company of South Korea's LX Group called LX International Corp announced recently it had bought a major stake in a present biomass power plant operator. It happened as it pushed to improve its renewable energy business.


• The LX International will take over a 63.3 per cent stake in Poseung Green Power Co., in Pyeongtaek situated south of Seoul, from DL Energy Co.. it will take for 95 billion ($76.7 million), a deal that was approved by its board earlier in the day the company said in a release.

July 2023, ABB has signed a contract with TOYO Engineering Corporation in Japan to supply its distributed control system (DCS) ABB Ability Symphony Plus, to the Wakayama Gobo Biomass Power Plant, around 120 km south of Osaka. The 50 MW biomass power plant, which will use wood pellets and agricultural byproduct as a feedstock, will be capable of supplying enough power for up to 110,000 Japanese households a year. 

In March 2023, the Japanese energy company Renova began operations of its Ishinomaki Hibarino biomass-based power plant in the Miyagi region at 75 MW capacities. The plant uses wood pellets and palm kernel shells for an electricity production of about 530 GWh/yr. After facing some delays at first, Renova executed the power plant project earning its space in the renewable energy sector in Japan.

In November 2022, Alier, a paper recycle specialist, and ENGIE concluded the Contract regarding the construction and commissioning of a new thermal energy generation plant based on sustainable forest resources within Rosello's plant engaged in paperboard for construction and packing industry (Lleida).

In March 2021, the company Salzburg AG signed an agreement with Valmet, a company that develops and provides technologies, automation and services for pulp and paper and energy industries. Valmet BioPower plant order for biomass electricity generation was in Austria for Salzburg AG.

In March 2021, Ørsted, Aker Carbon Capture and Microsoft signed a Memorandum of Understanding (MOU) to explore how carbon capture and storage could be integrated into biomass heat and power plants in Denmark.

Biomass Power Market Growth Dynamics:

Drivers

• Increased Demand For Power Generation:

Biomass is a sustainable and low-carbon alternative to conventional fossil fuels, which, on combustion, produces bioenergy that is considered as a clean fuel for energy generation. Growing demand for energy across the globe is anticipated to boost bioenergy production through biomass, which is also anticipated to support the growth of the market for biomass power. 

For instance, according to the International Energy Agency (IEA), bioenergy power production rose by approximately 5% in 2019, which is only a percent less than the 6% yearly power production rate required to meet the 2030 sustainable development scenario goals.

Moreover, renewable power generated from biomass has a wide impact on global warming emissions as it can limit the amount of CO2 released into the atmosphere. Furthermore, increasing the supply of renewable biomass power would allow us to replace carbon-intensive energy sources and significantly reduce global warming emissions. Thus, the increased demand for clean energy generation is expected to drive the growth of the global biomass power market during the forecast period.

• Rising Energy & Power Demand

Global energy demand has seen an exponential increase over the last few years due to rapid urbanization and a rapidly growing population worldwide. Most of the energy produced across the globe is from fossil fuels, which produce harmful GHG gases on burning. 

On the other hand, biomass is a carbon-neutral carrier and can make significant contributions in reducing greenhouse gas emissions. The International Energy Agency (IEA) has introduced a biomass action plan. The plan is meant to promote the use of biomass energy as an energy source with huge potential for power generation. Thus, the rising energy & power demand is expected to drive the growth of the global biomass power market during the forecast period.

Restraint

• High Capital Requirements & Operating Cost

Biomass power generation requires high capital investments and has high operating costs. Some of the major costs involved in biomass power generation are feedstock acquisition costs, transportation costs, costs associated with pre-treatment technologies of biomass, and the Levelized Cost of Electricity (LCOE), a calculation of the cost of generating electricity at the point of connection to a load or electricity grid. The LCOE of biomass-fired power plants ranges from 6 to 29 cents per kWh, based on capital costs and feedstock costs, which vary from place to place.

Furthermore, the operations and maintenance (OM) costs associated with biomass power generation accounts for 9 to 20 percent of the LCOE for biomass power plants. Landfill biogas power plants have higher OM costs as compared to other types of feedstock. 

Thus, the high capital requirements and operating costs involved in biomass power generation are expected to reduce the demand for biomass power, consequently hampering the growth of the global biomass power market during the forecast period. However, various governments around the world are offering subsidies and incentives for small-scale & medium-scale electricity generation plants through biomass sources, which is expected to support the global biomass power market over the forecast period.

Opportunity

• Favorable Government Policies & regulations

Favorable policies and regulations by governments across the world are expected to present lucrative growth and investment opportunities for vendors and new entrants in the global biomass power market. Governments are promoting the adoption of biomass for power generation as it is a renewable energy fuel and can help prevent the release of harmful CO2 gases and GHG emissions into the atmosphere. 

For instance, in India, according to the Ministry of New and Renewable Energy Report published by the Government of India (GoI), the Indian Renewable Energy Development Agency (IREDA) will provide loans for setting up biomass power plants and other biogas cogeneration projects in the country, as a result of which the number of investments in biomass power generation is expected to increase and boost the Biomass Power Market growth.

In North America, several federal government tax credits, grants, and loan programs are offered for qualifying renewable energy technologies and projects. The federal tax incentives and credits for qualifying renewable energy projects or equipment will include the Renewable Electricity Production Tax Credit (PTC), the Residential Energy Credit, the Investment Tax Credit (ITC), and the Modified Accelerated Cost-Recovery System (MACRS).

Segmentation: Global Biomass Power Market Overview

The global Biomass power market is classified based on feedstock, technology, end use, Standard Segment and region. By feedstock, the global market has been segmented into woody biomass, agricultural residues, forest residues, biogas landfill & sewage gas, energy crops, industrial & municipal waste. 

By technology, the global market has been segmented into anaerobic digestion, combustion, gasification and co-firing. By end-use, the global market has been segmented into residential, commercial and industrial.

Biomass power produces electricity from chemical energy that is contained in organic matter. Various types of biomass are suitable for power production, including wood waste, energy crops, and agriculture residues. It is a type of power generated from renewable organic waste that would otherwise be burned or left as fodder in forest fires. 

In biomass power plants, the feedstock is burned to produce steam that helps turn the turbine to generate electricity, which provides heat to homes and industrie

Biomass Power Market Outlook - Regional Analysis

The global Biomass power market has been segmented into five major regions, namely, North America, Europe, Asia-Pacific, the Middle East & Africa, and South America. The Biomass power market in Asia-Pacificis estimated to account for the highest share of the Biomass power market. Asia-Pacific is one of the largest markets for biomass power in the world. There is an increased demand for energy in the region because of the growing population and rising per capita disposable income in the region. 

Moreover, these rapidly growing economies in this region are also the top polluters in the world. Moreover, Asia-Pacific is estimated to showcase significant growth owing to the abundant availability of natural resources in the region. Emerging economies such as India and Indonesia promise sizeable growth due to proposed government legislation to increase investments in the biomass power sector.

Biomass Power Market Insights - COVID-19 Analysis:

The impact of COVID-19 on the worldwide economy is changing every day. It is proving to be a big challenge for the renewable industry, resulting in a shortage of raw material supply and impending job losses. In the energy & power industry, companies are dealing with several challenges due to a decline in electricity prices post the COVID-19 outbreak. Moreover, the US is one of the largest markets for biomass power generation. 

The slowdown in the country’s economic growth has affected the overall generation and renewable energy investment globally. Similarly, during the COVID-19 crisis, there has been an increased focus on renewable technologies; however, fewer power plants were working due to labor constraints.

As perthe Ministry of New and Renewable Energy (MNRE) reports, in India, only ~222 MW of solar and ~25 MW of wind capacity was achieved in March as all activities have halted due to the pandemic. Likewise, according to the survey conducted by the World Bioenergy Association (WBA), the majority of the respondents mentioned the significant impact of the pandemic on bioenergy business, leading to a reduction in investment and termination of new investments in the bioenergy sector. 

However, the solid biomass sector, including producers of wood pellets, has not experienced a major change in 2020 due to lesser restrictions. However, various biomass manufacturers such as Mitsubishi Heavy Industries, Babcock & Wilcox Enterprises, Inc., and Suez faced a production shutdown, resulting in huge backlogs and delays in completing orders.

COVID-19 has led to severe impact across all the industries around the world. The rapid spread has led governments across the globe to take stricter actions for the operations of industrial plants and offices, leading to stricter lockdowns. The lockdown had a notable impact on the energy sector overall as energy demand had decreased around 18% to 20% in 2020. 

Moreover, the virus also significantly impacted the bioenergy sector, emphasizing processed solid biomass such as wood pellets, chips, forest residues, and others. The impact was in terms of a slight decline in revenues and a challenging situation with managing the cash flow of the market players. However, the producers of industrial pellets experienced challenges in the procurement of feedstock as most of the industry depends on forestry harvesting, which was impacted due to national restrictions.

The report for the global biomass power market of MRFR research covers extensive primary research. This is accompanied by a detailed analysis of qualitative and quantitative aspects by various industry experts and key opinion leaders to gain deeper insights into the market and industry performance. 

The report clearly illustrates the current market scenario, including the historic and forecasted market size in terms of value and volume, technological advancement, macroeconomic, and governing factors of the market. The report provides comprehensive information about the strategies of the top companies in the industry and a broad study of the different market segments and regions.