Increased demand for electricity generation
Biomass is a sustainable, low-carbon alternative to traditional fossil fuels which, when burned, produce bioenergy, considered a clean fuel for energy production. Growing global energy demand is expected to drive bioenergy production through biomass, which will also contribute to the growth of the biomass electricity market. According to the International Energy Agency (IEA), bioenergy power generation increased by around 5% in 2019, just 1% less than the annual power generation rate of 6% required to achieve the objectives of the sustainable development scenario up to 2030.
In addition, renewable energies generated from biomass have a significant impact on emissions linked to global warming because they reduce the amount of CO2 emitted into the atmosphere. In addition, increasing the renewable energy supply from biomass would replace carbon-intensive energy sources while significantly reducing global warming emissions. As a result, the increasing demand for clean power generation is likely to fuel the expansion of the global biomass energy market throughout the forecast period.
Increased demand for energy and electricity
Global demand for energy has grown exponentially in recent years due to increasing urbanization and rapid growth in the world’s population. The majority of the energy produced in the world comes from fossil fuels, which emit harmful GHG emissions when burned. Biomass, on the other hand, is a carbon neutral vector that can make a major contribution to reducing greenhouse gas emissions.
The International Energy Agency (IEA) has published an action plan for biomass. The plan aims to promote the use of biomass energy as an energy source with enormous potential for power generation. As a result, increasing demand for energy and electricity is likely to fuel the growth of the global biomass energy market during the forecast period.
Restrictions caused by COVID-19 pandemic impact global market
The impact of COVID-19 on the global economy is changing daily. It is proving to be a significant obstacle for the renewable energy industry, leading to a raw material supply crisis and likely job losses. Companies in the energy and electricity sector are facing a number of challenges due to falling electricity costs in the wake of the COVID-19 outbreak. In addition, the United States is one of the largest markets for the production of electricity from biomass.
The slowdown in the country’s economic growth has had an impact on global production and investment in renewable energy. Likewise, during the COVID-19 crisis, the focus was more on renewable technologies; however, due to labor restrictions, fewer power plants were operational.
According to the Ministry of New and Renewable Energy (MNRE), only 222 MW of solar capacity and 25 MW of wind capacity were achieved in India in March, as all efforts were halted due to the pandemic. Likewise, the majority of those polled in a survey by the World Bioenergy Association (WBA) acknowledged the tremendous impact of the pandemic on the bioenergy industry, leading to reduced investments and the cancellation of new investments in the bioenergy sector. However, due to fewer limitations, the solid biomass industry, including wood pellet manufacturers, has not seen any significant change in 2020.
COVID-19 has had a significant impact on all businesses around the world. Due to rapid growth, governments around the world have taken more stringent measures for the operation of industrial facilities and offices, resulting in tighter shutdowns. Containment has had a significant influence on the energy sector, with energy demand falling from 18% to 20% in 2020. In addition, the virus has had a significant influence on the bioenergy sector, with a special emphasis on transformed solid biomass such as wood pellets, chips, forest residues and others. This resulted in a slight drop in revenues and a difficult position in controlling the cash flow of market players. However, industrial pellet producers have found it difficult to source raw materials as the majority of the sector relies on logging, which has been hampered by national restrictions.
APAC leads the world market with the largest share
The biomass industry in Asia-Pacific is expected to account for the largest part of the global biomass market. Asia-Pacific is one of the world’s largest markets for biomass energy. Due to the region’s population growth and the increase in disposable income per capita, the demand for energy is increasing. In addition, the rapidly developing economies of this region are also the biggest polluters in the world. In addition, due to the region’s abundance of natural resources, Asia-Pacific is expected to experience significant growth. Emerging economies like India and Indonesia are expected to experience significant growth due to the legislation proposed by the government to promote investment in the biomass energy sector.