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Renewable energy – It's

Renewable energy and its impact on timber-based industries

The European Commission recently presented the 2030 policy framework for climate and energy, where expectations are that by 2030, the share of renewable energy will be of at least 27%. In this respect, the recent years European policies on biomass have driven consumption of wood pellets up to new records every year.

For example, consumption of wood pellets in the European Union increased almost 4 times from 2006 to 2013 (from 4,6 million tonnes, up to 16 million in 2013). Based on the targets set by the European authorities, some forecasts, like the one of the European Biomass Association (AEBIOM), predict that by 2020 consumption of wood pellets in the EU will reach 50-80 million tonnes. One thing is clear: with the new renewable energy targets set by the European authorities, some of the EU countries will become dependent on imports, as production has slowed down since 2010 and is now around an estimated (2013) 10 million tonnes (9,2 million t in 2010). Thus, imports boomed again in 2013 and grew in volume by 32% as compared to the previous year, passing the 10 million tonnes mark, and reaching 11,05 mil. tonnes. In value, the increase is of 32% (EUR 1,66 billion).

In Europe, there are two main drivers that support this spectacular forecast. First there are the conversion plans from coal to biomass of large power plants, especially in the UK. And second, the efforts of many European countries to increase the share of renewable energy in their heating sectors.

On these two facts, demand is quite divided in the EU: the UK, the Netherlands and Belgium have opted to meet part of their renewable energy obligations by the use of biomass for the generation of electricity. Therefore, these three countries are mainly using pellets for power plants. Conversely, in Germany, Austria, Italy, France and Sweden, wood pellets are mainly used in small-scale private residential and industrial boilers for heating. In Denmark, which is the second European wood pellets consumer (after the UK), pellets are used both in small boilers in private homes or medium-sized district heating plants, but also in large combined heating and power (CHP) plants.

This trend goes not without controversy. The amount of economic stimulus towards wood pellets has created distorsions in the marketplace affecting other industries also dependent on timber production. One thing is clear, there is no simple answer to this controversy. Please let us know what you thinkā€¦