Biomass Pellets Market to hit USD 17.38 Billion by 2033, Says We Market Research

CHICAGO, Dec. 1, 2023 /PRNewswire/ -- As per the most recent analysis conducted by We Market Research, the biomass pellets market is on track to reach a value of $17.38 billion by the end of 2033. Looking ahead, the market's prospects appear even more impressive, with projections suggesting a significant increase to $11.57 billion in 2023. This remarkable growth trajectory is underpinned by a strong compound annual growth rate (CAGR) of 5.9% expected between 2023 and 2033.

Favorable Government Policies and Incentives for Biomass Pellets to boost the growth of biomass pellets market

Governments around the world are implementing supportive policies and incentives to promote the use of biomass pellets as a renewable energy source. This includes feed-in tariffs, renewable energy targets, tax incentives, and grants, which are driving the market growth and encouraging investment in biomass pellet production

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Renewable Energy Directive (RED) and RED II: The Renewable Energy Directive is a key policy framework in the European Union (EU) that sets binding targets for the share of renewable energy in the overall energy consumption. Biomass pellets are eligible for support under this directive, and RED II has further reinforced the sustainability criteria for biomass used in energy production.

Feed-in Tariffs and Premiums: Many European countries have implemented feed-in tariffs and premiums to incentivize the production of renewable energy, including biomass pellets. These mechanisms guarantee a fixed payment or additional premium for electricity generated from biomass pellets, making it financially attractive for producers.

Biomass Pellets Market Report Scope:

Renewable Heat Incentive (RHI): The RHI schemes in various European countries, such as the United Kingdom and Germany, provide financial incentives to promote the use of renewable heat sources, including biomass pellets. These incentives support the installation of biomass pellet heating systems in residential, commercial, and industrial sectors.

Biomass Crop Assistance Program (BCAP): BCAP in the United States offers financial incentives for the establishment, production, and delivery of biomass feedstocks, including those used for biomass pellet production. The program supports the growth of the biomass industry and encourages the adoption of biomass pellets for energy generation.

Production Tax Credits (PTCs) and Investment Tax Credits (ITCs): The U.S. federal government provides tax credits for renewable energy projects, which can benefit biomass pellet producers. PTCs provide a per-kilowatt-hour credit for electricity generated from biomass, while ITCs offer a tax credit for the capital investment in qualifying renewable energy facilities.

Renewable Energy Sources Act (EEG): The EEG in Germany provides a feed-in tariff system and priority grid access for renewable energy sources. Biomass pellets market are eligible for support under this policy, and biomass pellet producers can benefit from guaranteed purchase prices for the electricity they generate.

Combined Heat and Power (CHP) Act: Germany has specific regulations and incentives for combined heat and power plants that use biomass as a fuel source, including biomass pellets. The CHP Act provides financial support, favorable electricity tariffs, and exemption from certain levies for CHP systems that meet the criteria.

Renewable Heat Incentive (RHI): The United Kingdom's RHI scheme supports the use of renewable heat sources, including biomass pellets, through financial incentives. Biomass pellet heating systems installed in eligible sectors can receive payments based on the heat generated.

Europe biomass pellets market is set to reach a volume of 54.44 million metric tons by 2033

Europe is positioned to be a game-changer within the biomass pellet market, driven by a combination of factors that align with the region's commitment to renewable energy and sustainability. The European Union's ambitious climate and energy targets, including the European Green Deal and the 2033 Climate and Energy Framework, emphasize a transition towards cleaner and more sustainable energy sources. In this context, biomass pellets, derived from organic materials such as wood, agricultural residues, and dedicated energy crops, have gained prominence as a key renewable energy resource.

Several factors contribute to Europe's pivotal role in the biomass pellet market. Firstly, the region's robust regulatory framework and supportive policies, such as the Renewable Energy Directive (RED II), create a conducive environment for the production and consumption of biomass pellets. These policies promote the use of biomass for energy generation, emphasizing its role in reducing greenhouse gas emissions and fostering a circular economy.

Secondly, Europe's commitment to phasing out coal-fired power plants and achieving carbon neutrality further accelerates the demand for biomass pellets as an alternative, sustainable energy source. Biomass pellets are considered a carbon-neutral fuel, as the carbon dioxide released during combustion is offset by the carbon absorbed during the growth of the source materials.

Thirdly, advancements in technology and sustainable forest management practices in Europe enhance the efficiency and environmental credentials of biomass pellet production. The region's focus on ensuring the sustainability and traceability of biomass feedstocks aligns with the growing global demand for responsibly sourced bioenergy.

Moreover, Europe's well-established infrastructure for biomass supply chains, including logistics, transportation, and storage facilities, positions it as a key player in the global biomass pellet market. The availability of established trading platforms and biomass certification schemes further contributes to the region's influence.

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In conclusion, Europe's proactive approach to renewable energy, coupled with supportive policies, technological advancements, and a commitment to sustainability, positions the region as a game-changer in the biomass pellet market. As the demand for clean and renewable energy sources continues to rise globally, Europe's leadership in this sector not only drives economic growth but also contributes significantly to the ongoing global energy transition.

Competitive Analysis

Some of the major companies operating within the biomass pellets market are AS Graanul Invest, Pinnacale Renewable Energy Inc., Lignetics, Zilikha Biomass Energy, Enviva Biomass, New England Wood Pellet and others.

Enviva Biomass dominated the market with an active share of 8.27% in 2022,followed by New England Wood Pellet with 6.11%.

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SOURCE We Market Research