WPAC Report: Wood pellets taking centre stage

Global trendsetters

I recently attended the annual World Sustainable Energy Days event in Wels, Austria. Irene di Padua, director of policy at Bioenergy Europe, reported on global market trends and highlighted that the UK, South Korea and Denmark top the list in countries reaping the benefits of bioenergy from wood pellets. What really struck me, however, was the uptick in residential and commercial demand, which now makes up 48 percent of wood pellet consumption. This growth is most apparent in Europe where they have seen demand grow by 18 percent and boiler sales by a whopping 109 percent. Di Padua puts it best: “2021 was an exceptional year for pellets, with increased production, consumption and sales of boilers and stoves.”

Today, nearly three-quarters of the world’s renewable energy is from biomass. Bioenergy accounts for about 10 percent of total final energy consumption and two percent of global electricity generation. In the United States and the European Union, bioenergy accounts for 60 percent of all renewable energy. In fact, over the past 20 years, bioenergy, is responsible for the most greenhouse gas (GHG) reductions, much in the form of bioheat.

Renewable energy is also considered indispensable to Japan’s pledged decarbonization strategy, and as part of its goal to become carbon-neutral by 2050 the country is accelerating its use of biomass. For the first time in history, Japan has surpassed the UK in pellet imports from Canada.

India, too, recognizes the need to reduce GHG emissions and transition to clean energy. Significant opportunity exists in capitalizing on India’s domestic biomass production to support its ambitious climate change goals. I recently visited India on a trade mission. You can read my report, watch the video or see the presentation at www.pellet.org.

Canada: opportunity is knocking

At 2.8 million tonnes of annual consumption of wood pellets, North America lags behind Europe (35.6 million tonnes, incl. UK) and Asia (7.2 million tonnes). In Canada, in part, this is due to many of our provinces having access to hydro electricity and natural gas. But in some Maritime provinces and remote northern and Indigenous communities, energy poverty is a reality.

Canada is the world’s second largest producer of wood pellets; but more than 90 percent of our pellets are exported. Why? Yes, we have work to do on promoting wood pellets to make Canadians more aware; but the fact is we see publicly funded incentives for competing products, like heat pumps and investments in far-off solutions like hydrogen, when the solutions are in the sawmill and harvest residuals across Canada’s forests.

There are examples of smaller markets leading the way on the use of bioheat. Take Upper Austria – about one-sixth the size of New Brunswick with 1.5 million people. According to Christiane Egger, deputy manager of the Energy Agency of Upper Austria, in her region, biomass accounts for 42 percent of space heating and provides 18 percent of energy used in manufacturing. The use of fossil fuels for heating is banned in all new home construction and heating system replacements – a key driver behind the 72,000 modern automatic biomass and 360 biomass district heating plants now operating in the region. Austria has succeeded in making biomass a mainstream fuel.

The good news is that significant inroads to biomass has already been made in Canada’s Maritime provinces and Northern and remote communities, and you can read about some of those projects on our website.

Mainstream shift needs policy

Today, biomass is recognized by the Government of Canada as low-carbon technology, typically saving 90 percent GHG emissions over fossil alternatives. It can contribute to the elimination of heating oil and natural gas heating in Canada and mitigate the effect of closing coal power plants by providing high efficiency, low carbon heat energy in replacement for fossil-derived electric heating.

But to reach its full potential, good public policy from the ground up and fair incentives from governments are needed.

In British Columbia, we are already seeing the province’s commitment to reduce “waste” through projects funded by the Forest Enhancement Society of B.C. that will help get more fire-damaged wood and logging waste to the mills that need it.

The Government of Canada also recognizes the role of forest bioenergy in reducing Canada’s emissions under the 2030 Emissions Reduction Plan. Programs like the Clean Technology Investment Tax Credit are key to expanding clean technology solutions in places like New Brunswick and Nova Scotia, however, biomass boilers must be afforded a level playing field with other clean technologies like heat pumps.

Over the next decade, both these provinces’ electricity capacity is forecasted to drop by 50 percent. Heat pumps alone will not solve the problem which will require the current fossil fuel grid to run the heat pumps. Including biomass from wood pellets is good for Canadians’ pocketbooks; it’s good for the environment; and it’s good for local economies.

We’ve also got work to do on removing trade barriers that restrict the importation of European boilers into Canada. Currently, we don’t make boilers in Canada, and we can’t import them as they are manufactured, so the only significant markets for our pellets is offshore, to be used in homes and businesses around the world as a sustainable source of renewable energy and heat. Canada’s wood pellet consumption is tiny by global standards, entirely due to the lack of access to modern highly automated wood pellet boilers. We’re making good progress on this front.
Domestic opportunities

My recent trips to India and Europe have left me inspired. The benefits of bioheat are now accepted as mainstream and the focus is now on how to grow markets, improve technology and to continue to promote the benefits of bioheat. Here in Canada, we have work to do, but it’s also clear to me that there is a groundswell of support and increasing awareness of the potential of local bioheat solutions.