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Canada Biomass Market

ID: MRFR/CnM/46663-HCR
111 Pages
Chitranshi Jaiswal
October 2025

Canada Biomass Market Research Report By Feedstock (Food Crop, Non-Food Crop, Wood, Agricultural Residue, Municipal Solid Waste (MSW), Microalgae, Others), By Technology (Combined Heat and Power (CHP), Anaerobic Digestion and Feedstockification, Co-Firing, Landfill Feedstock), By Product (Biodiesel, Biomethanol, BioFeedstock, Others) and By End Use (Industrial, Commercial, Residential) - Forecast to 2035

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Canada Biomass Market Summary

As per analysis, the Canada biomass market is projected to grow from USD 6,466.5 Million in 2025 to USD 12,866.4 Million by 2035, exhibiting a compound annual growth rate (CAGR) of 7.12% during the forecast period (2025 - 2035).

Key Market Trends & Highlights

The Canada biomass market is poised for growth driven by technological advancements and increasing demand for sustainable energy solutions.

  • Electricity generation remains the largest segment in the Canada biomass market, reflecting a stable demand for renewable energy.
  • Heating is the fastest-growing segment, indicating a shift towards biomass as a viable alternative for residential and commercial heating.
  • Wood pellets dominate the biomass fuel market, while agricultural residues are emerging as a rapidly growing source of biomass energy.
  • Government incentives for renewable energy and rising energy prices are key drivers propelling the biomass market forward.

Market Size & Forecast

2024 Market Size 6036.57 (USD Million)
2035 Market Size 12866.4 (USD Million)
CAGR (2025 - 2035) 7.12%

Major Players

West Fraser Timber Co Ltd (CA), Canfor Corporation (CA), Resolute Forest Products Inc (CA), Interfor Corporation (CA), Drax Group plc (GB), Pinnacle Renewable Energy Inc (CA), Bioenergy Infrastructure Group (GB), Greenwood Resources Inc (CA), Rentech Inc (CA)

Canada Biomass Market Trends

The Canada biomass market is currently experiencing a notable transformation, driven by a growing emphasis on renewable energy sources and sustainability. The government has implemented various policies aimed at promoting the use of biomass as a viable alternative to fossil fuels. This shift is largely influenced by the need to reduce greenhouse gas emissions and enhance energy security. As a result, biomass energy is increasingly being integrated into the national energy mix, with a focus on utilizing agricultural residues, forestry by-products, and organic waste. The market appears to be expanding, with investments in technology and infrastructure that support biomass production and utilization. Moreover, the Canada biomass market is characterized by a diverse range of applications, including electricity generation, heating, and transportation fuels. The potential for innovation in biomass conversion technologies is significant, as research institutions and private enterprises collaborate to develop more efficient processes. Additionally, the increasing awareness of environmental issues among consumers is likely to drive demand for biomass products. This trend suggests a promising future for the sector, as stakeholders work together to harness the full potential of biomass resources in Canada.

Government Support and Policy Framework

The Canadian government has established a supportive policy environment that encourages the development of biomass energy. Initiatives aimed at reducing carbon emissions and promoting renewable energy sources are central to this framework. Various funding programs and incentives are available to stimulate investment in biomass projects, which may enhance the market's growth prospects.

Technological Advancements in Biomass Conversion

Innovations in biomass conversion technologies are emerging as a key trend within the Canada biomass market. Research and development efforts are focused on improving efficiency and reducing costs associated with biomass processing. These advancements could lead to more competitive biomass products, making them increasingly attractive to consumers and industries alike.

Growing Demand for Sustainable Energy Solutions

There is a rising consumer preference for sustainable energy solutions in Canada, which is influencing the biomass market. As individuals and businesses seek to reduce their carbon footprints, the demand for biomass energy is likely to increase. This trend reflects a broader societal shift towards environmentally responsible practices and may drive further investment in biomass resources.

Market Segment Insights

By Application: Electricity Generation (Largest) vs. Heating (Fastest-Growing)

The Canada biomass market showcases a diverse application spectrum, with electricity generation holding the largest market share. This segment benefits from the growing demand for renewable energy sources and the supportive regulatory framework aimed at reducing carbon emissions. Conversely, heating applications represent the fastest-growing segment within the biomass market, driven by increased consumer awareness of sustainable heating solutions and the implementation of various incentive programs to promote the use of biomass for residential and commercial heating. As the renewable energy landscape evolves, both electricity generation and heating are witnessing significant growth. The adoption of advanced technologies in biomass utilization and supportive government policies further enhance the viability of these applications. The transition towards low-carbon energy systems along with increased investments in biomass energy projects underlines the emerging trends that define the future of the market, catering to both industrial and residential needs.

Electricity Generation (Dominant) vs. Transportation (Emerging)

Electricity generation stands as the dominant application of biomass in Canada, largely owing to its established infrastructure and reliability in providing renewable energy. This segment leverages biomass resources to generate power, thereby contributing to Canada's clean energy targets. In contrast, transportation is seen as an emerging application area for biomass, driven by the global push for sustainable fuel options and reduced greenhouse gas emissions. Although still in developmental stages compared to electricity generation, transportation fuels derived from biomass, such as bioethanol and biodiesel, are gaining traction. The collaboration between technology developers and policymakers facilitates innovation, leading to advancements in biomass production technologies that enhance the efficiency and feasibility of biomass use in transportation.

By Feedstock Type: Wood Pellets (Largest) vs. Agricultural Residues (Fastest-Growing)

In the Canada biomass market, the feedstock type segment exhibits a diverse distribution. Wood pellets hold the largest market share due to their widespread use in heating and electricity generation. They are favored for their energy density and low emissions compared to fossil fuels. Agricultural residues, while currently smaller in share, are experiencing a rapid increase in adoption as more producers look to sustainable practices to reduce waste and enhance efficiency. Growth trends in the feedstock type segment are being driven by government incentives for renewable energy and a growing awareness of environmental sustainability. Wood pellets will likely maintain dominance due to their established infrastructure and reliability. However, agricultural residues are emerging quickly as production methods improve, demonstrating a shift toward circular economy principles in the biomass market.

Wood Pellets (Dominant) vs. Agricultural Residues (Emerging)

Wood pellets represent the dominant feedstock type in the Canada biomass market, characterized by high energy efficiency and low greenhouse gas emissions. They are produced from compacted wood fibers and offer a consistent quality that appeals to both residential and industrial users. In contrast, agricultural residues, which include crop by-products such as straw and husks, are gaining traction as an emerging feedstock. They provide an avenue for waste reduction while contributing to sustainable energy production. Farmers increasingly recognize the value of agricultural residues in reducing their carbon footprint and increasing profitability, leading to innovations in collection and processing methods, thereby enhancing their market presence.

By End Use: Residential (Largest) vs. Power Generation (Fastest-Growing)

The Canada biomass market is primarily segmented into Residential, Commercial, Industrial, and Power Generation uses. Among these segments, Residential applications hold the largest share, catering to homeowners seeking eco-friendly heating solutions. Commercial and Industrial applications are also significant but have a smaller market presence compared to the Residential sector. As the demand for sustainable energy sources continues to rise, we observe shifts in usage patterns that favor more efficient biomass applications across the board.

Residential (Dominant) vs. Power Generation (Emerging)

The Residential segment of the Canada biomass market is characterized by its widespread adoption of biomass heating solutions, including wood stoves and pellet boilers, driven by consumer demand for sustainable living practices. This segment remains dominant due to the increasing emphasis on reducing carbon footprints in household energy usage. Conversely, the Power Generation segment is emerging rapidly, fueled by advancements in technology and government initiatives supporting renewable energy sources. Biomass power generation is gaining traction as an alternative to fossil fuels, leveraging waste materials to produce electricity and thereby contributing to Canada's overall energy transition.

By Technology: Combustion (Largest) vs. Gasification (Fastest-Growing)

The Canada biomass market showcases diverse technologies, with Combustion leading in market share due to its established applications in energy generation. This segment has successfully leveraged its reliability and efficiency, making it a preferred choice for biomass energy producers. Meanwhile, Gasification is emerging strongly, capturing attention with its innovative approach to converting biomass into syngas, which can be utilized for various applications, thereby gradually increasing its share in the market.

Technology: Combustion (Dominant) vs. Gasification (Emerging)

Combustion remains the dominant technology in the Canada biomass market, largely due to its decades-long presence and proven efficiency in converting biomass into heat and power. Key advantages include the simplicity of technology and the ability to handle a wide range of feedstocks. On the other hand, Gasification is gaining traction as an emerging technology, primarily driven by the growing need for cleaner energy solutions. This process not only reduces emissions but also allows for the production of valuable byproducts. As government policies improve support for renewable energy sources, Gasification's role in sustainable biomass energy is set to expand significantly.

Get more detailed insights about Canada Biomass Market

Key Players and Competitive Insights

The biomass market in Canada is characterized by a dynamic competitive landscape, driven by increasing demand for renewable energy sources and a growing emphasis on sustainability. Key players such as West Fraser Timber Co Ltd (CA), Canfor Corporation (CA), and Pinnacle Renewable Energy Inc (CA) are actively shaping the market through strategic initiatives. West Fraser Timber Co Ltd (CA) focuses on innovation in biomass production technologies, while Canfor Corporation (CA) emphasizes regional expansion to enhance its supply chain capabilities. Pinnacle Renewable Energy Inc (CA) is leveraging partnerships to optimize its operational efficiency, collectively contributing to a competitive environment that prioritizes sustainability and technological advancement.

The market structure appears moderately fragmented, with several players vying for market share. Key business tactics include localizing manufacturing to reduce transportation costs and optimizing supply chains to enhance responsiveness to market demands. The collective influence of these major companies fosters a competitive atmosphere where agility and innovation are paramount, allowing them to adapt to evolving consumer preferences and regulatory frameworks.

In November 2025, West Fraser Timber Co Ltd (CA) announced a strategic partnership with a leading technology firm to develop advanced biomass processing techniques. This collaboration is expected to enhance production efficiency and reduce emissions, aligning with the company's commitment to sustainability. Such initiatives not only bolster West Fraser's market position but also set a benchmark for industry practices.

In October 2025, Canfor Corporation (CA) unveiled plans to expand its biomass production facilities in British Columbia. This expansion is anticipated to increase the company's output capacity by 30%, enabling it to meet the rising demand for renewable energy. The strategic move underscores Canfor's focus on regional growth and its commitment to supporting local economies while addressing environmental concerns.

In September 2025, Pinnacle Renewable Energy Inc (CA) secured a long-term supply agreement with a major utility provider, ensuring a stable market for its biomass products. This agreement is significant as it not only guarantees revenue stability but also reinforces Pinnacle's role as a key player in the renewable energy sector. Such strategic actions are indicative of the company's proactive approach to securing its market position amidst increasing competition.

As of December 2025, current trends in the biomass market are heavily influenced by digitalization, sustainability, and the integration of AI technologies. Strategic alliances are becoming increasingly vital, as companies seek to enhance their operational capabilities and market reach. The competitive differentiation is likely to evolve from traditional price-based competition to a focus on innovation, technological advancements, and supply chain reliability. This shift suggests that companies that prioritize these aspects will be better positioned to thrive in the future.

Key Companies in the Canada Biomass Market market include

Industry Developments

The Canada Biomass Market has seen a number of significant developments recently. Notably, Resolute Forest Products and West Fraser Timber Co Ltd have been pivotal players in driving innovation and sustainability in biomass utilization, catering to a growing demand for renewable energy. Moreover, notable current affairs reflect increased investment in biofuel technologies by Nexterra Systems Corp and renewable energy initiatives by FortisBC Energy Inc, both focusing on reducing greenhouse gas emissions. In recent updates, Canfor Corporation announced its plans for expansion, aiming to enhance its biomass product offerings, while Sappi Lanaken continues to explore partnerships that align with eco-friendly practices.

Notably, the acquisition news in the sector has been focused on EACOM Timber Corporation, which has been active in mergers to strengthen its market position. The market has experienced fluctuations in valuation, heavily influenced by renewable energy policies and rising public interest in sustainable practices. Over the past years, significant milestones, like the formation of the Alberta Biomass Association in March 2022, have helped foster collaborative efforts among stakeholders to boost biomass allocation towards achieving Canada’s climate goals. The investments and policy changes reflect a larger trend toward transitioning to cleaner energy alternatives across the country.

Future Outlook

Canada Biomass Market Future Outlook

The Canadian biomass market is poised for growth at 7.12% CAGR from 2024 to 2035, driven by renewable energy policies, technological advancements, and increasing demand for sustainable energy solutions.

New opportunities lie in:

  • Expansion of biomass supply chains for industrial applications.
  • Development of advanced biomass conversion technologies.
  • Investment in biomass energy storage solutions for grid stability.

By 2035, the biomass market in Canada is expected to be robust, driven by innovation and sustainable practices.

Market Segmentation

Canada Biomass Market End Use Outlook

  • Residential
  • Commercial
  • Industrial
  • Power Generation

Canada Biomass Market Technology Outlook

  • Combustion
  • Gasification
  • Anaerobic Digestion
  • Pyrolysis

Canada Biomass Market Application Outlook

  • Electricity Generation
  • Heating
  • Transportation
  • Industrial Processes

Canada Biomass Market Feedstock Type Outlook

  • Wood Pellets
  • Agricultural Residues
  • Energy Crops
  • Animal Manure

Report Scope

MARKET SIZE 20246036.57(USD Million)
MARKET SIZE 20256466.5(USD Million)
MARKET SIZE 203512866.4(USD Million)
COMPOUND ANNUAL GROWTH RATE (CAGR)7.12% (2024 - 2035)
REPORT COVERAGERevenue Forecast, Competitive Landscape, Growth Factors, and Trends
BASE YEAR2024
Market Forecast Period2025 - 2035
Historical Data2019 - 2024
Market Forecast UnitsUSD Million
Key Companies ProfiledWest Fraser Timber Co Ltd (CA), Canfor Corporation (CA), Resolute Forest Products Inc (CA), Interfor Corporation (CA), Drax Group plc (GB), Pinnacle Renewable Energy Inc (CA), Bioenergy Infrastructure Group (GB), Greenwood Resources Inc (CA), Rentech Inc (CA)
Segments CoveredApplication, Feedstock Type, End Use, Technology
Key Market OpportunitiesExpansion of sustainable biomass energy solutions driven by regulatory support and increasing consumer demand.
Key Market DynamicsGrowing regulatory support for renewable energy drives expansion of the Canada biomass market amid evolving consumer preferences.
Countries CoveredCanada

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FAQs

What is the projected market size of the Canada Biomass Market in 2024?

The Canada Biomass Market is expected to be valued at 6.5 USD Billion in 2024.

What is the estimated market size for the Canada Biomass Market by 2035?

By 2035, the Canada Biomass Market is projected to reach a value of 12.0 USD Billion.

What is the expected CAGR for the Canada Biomass Market from 2025 to 2035?

The expected CAGR for the Canada Biomass Market from 2025 to 2035 is 5.732%.

Which feedstock segment holds the largest market share in Canada Biomass Market for 2024?

The Wood segment is expected to hold the largest market share, valued at 2.0 USD Billion in 2024.

What is the market size for the Food Crop segment within the Canada Biomass Market in 2024?

The Food Crop segment is valued at 1.5 USD Billion in the Canada Biomass Market in 2024.

What are the key players in the Canada Biomass Market?

Key players in the Canada Biomass Market include Resolute Forest Products, West Fraser Timber Co Ltd, and Canfor Corporation.

How much is the Agricultural Residue segment expected to be valued by 2035?

The Agricultural Residue segment is expected to be valued at 1.8 USD Billion by 2035.

What opportunities exist in the Canada Biomass Market from 2025 to 2035?

Opportunities in the Canada Biomass Market include increasing demand for renewable energy and sustainable practices.

What challenges might affect the growth rate of the Canada Biomass Market?

Challenges that might affect growth include competition with fossil fuels and regulatory hurdles.

What is the projected market value of Municipal Solid Waste (MSW) by 2035?

The Municipal Solid Waste (MSW) segment is projected to be valued at 1.8 USD Billion by 2035.

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