Our conversations with interesting people from the pellet market continue with a visit to Poland – one of the countries with the biggest increase in producing and consuming premium pellets over the past few years. We are about to learn more on the topic from Agnieszka Kędziora-Urbanowicz from the Polish Pellet Council.
Hello Agnieszka, the Polish Pellet Council is an ENplus® National Promoting Association. What does it mean for the Polish pellet market? What is your role and impact?
The Polish Pellet Council as a National Promoting Association acts as a national contact point for the pellet industry in Poland as well as abroad on matters of legal regulations, pellet quality, certification systems, tests, but also when it comes to fraud or when non-compliant pellets are placed on the market. We focus on activities contributing to "improving air quality" and "limiting the CO2 emission" through continuous cooperation with the legislator regarding national regulations, promoting pellets as an ecological fuel, as well as conducting research and educational activities. We actively support producers, traders, and service providers, as well as the end-users.
I personally actively support the association as a person responsible for technical issues related to the quality of pellets, conduct training, education, support in the activities of the association, i.e. substantial cooperation with the ministry responsible for clean air protection regulations or support of European Pellet Council as a trainer conducting authorized training for ENplus® Quality Managers in Poland.
How has the market developed over the past few years? Why do we see so many producers applying for an ENplus® certification?
The increase in the popularity of biofuels in the form of wood pellets results not only from greater care for the environment, but also from savings for the end-users. Today, most of the production is still exported to countries that started producing green energy at an industrial scale as early as the 1980s, such as Sweden or Denmark, and began reducing CO2 emissions and liquid fuel consumption earlier than Poland. However, this situation is changing, and more and more domestic product is distributed locally.
The increase in local retail sales of pellets is also influenced by manufacturers of boilers, which are more and more modern, self-service and, above all, easily available. All these factors are of great importance for the development of the entire industry, which should become even more noticeable in the coming years. Thus, the choice of RES may, in a broader perspective, contribute to the economic growth of the entire country.
According to reports published by the European Pellet Council (EPC), Poland is listed as one of the leading producers of wood pellets. Therefore, the wood pellet production industry does not lag behind European leaders - we continue to record increases in pellet production, which are primarily due to new, medium-sized (up to 10,000 tonnes/year) production units. Most of them decide to obtain a certificate confirming the consistency of pellet parameters for the A1 or A2 quality classes, i.e. the ENplus® certificate. Since the beginning of 2023, more than a dozen new entities have been registered on the list applying for the ENplus® certificate, which shows that the industry is developing intensively.
Is Poland on track to phase out fossil fuels and what is the role of biomass fuels such as pellets in this transition?
Despite the fact that the previous year was a very interesting year (to a large extent, it was marked by huge changes on the market of biofuels and other solid fuels used in home heating and huge uncertainty about the development of the market), the consumption of pellets in Poland has been growing steadily. Government and local government subsidies for the replacement of old heating installations resulted in an increase in the number of new, ecological devices, which translated into an increase in pellet consumption. It is expected that the effect of these subsidies (including under the "Clean Air" program) will be felt for many years to come.
In terms of retail sales in Poland, the market is becoming more and more absorptive, but it is a long-term process. This is due to the high VAT rate (23%). Nevertheless, the price of pellets remains competitive compared to, for example, eco-pea coal. It is also important that producers pay more and more attention to the quality of their products and certify them, which is noticed by more and more aware end-users.
Are pellets gaining popularity among the users in your country? Does the local government promote this heating solution sufficiently?
2023 poses many challenges for us as an Association and also as a country, such as the reconstruction of the wood pellet market, changes in the distribution system and communication with customers, and also the restructuring of many production companies. This year also creates many opportunities that may arise due to the growing attention towards the pellet industry by the government administration. The pellet industry, having started as a niche industry, has become an important element of the home heating system for a few years now. The activity of the Polish Pellet Council has contributed for this perception of the industry.
2023 will be extremely important in this regard, due to the fact that it is an election year and cooperation with the government administration in supporting the entire sector may be very important for the future.
It should be noted that the Polish Pellet Council received an invitation to two Working Groups at the Ministry of Climate, aimed at developing new regulations on monitoring the quality of solid fuels and developing the biomass market for district heating. We are very active in both of these groups and our postulates and conclusions are taken into account.
In addition, we have started a battle for the introduction of new, reduced VAT rates for wood pellets, which we hope will be successful this year. Here I should mention also the more and more effective actions aimed at stopping mainly local government and voivodeship communities from introducing "bans on the use of biomass", including pellets. There have already been significant successes here.
In addition, we continue to promote good quality wood pellets and pellet installations on a grass-roots basis through regular publications in newsletters, comments to industry magazines, participation in industry events taking place in the country and abroad.