The global Biomass power market size is registering a CAGR of 6% during the forecast period 2023-2031.
Biomass power is an alternative source of electricity generated from organic waste such as scrap lumber, forest debris, and agricultural harvest waste that are usually dumped in landfills, burned, or left as fodder for forest fires. These natural materials generate clean, renewable electricity while limiting carbon emissions and safeguarding the environment against the hazardous effects of greenhouse gases. Biomass also improves forest health, protects air quality, and offers a reliable renewable energy source. The global biomass power market is segmented by technology, feedstock, and regions.
|Fastest Growing Market||Asia Pacific|
|Report Coverage||Revenue Forecast, Competitive Landscape, Growth Factors, Environment & Regulatory Landscape and Trends|
Increased carbon emissions from conventional fossil fuels have released harmful greenhouse gases, leading to global warming. Global warming is the primary environmental concern driving the global market of biomass power. In the wake of rising environmental concerns, European countries such as the UK, Germany, and Finland are looking to phase out coal-based power generation and adopt biomass power as an alternative. Similarly, Asian countries such as China, India, and Indonesia are shifting toward cleaner and more efficient energy sources.
Furthermore, favorable government policies and regulations worldwide to promote renewable and sustainable power generation have stimulated the global biomass power market. In addition, government schemes and plans such as Feed-in-Tariff (FiT) also focus on providing relaxation in tariffs. Concurrently, these factors will encourage the growth of the biomass power industry during the forecast period.
During the forecast period, the biomass electricity market is anticipated to be driven by the quick expansion of renewable power generation capacity investments. An extensive number of power generation companies are investing in renewable energy sources, particularly in the USA and European nations, according to the biomass electricity market analysis. For instance, the International Energy Agency (IEA) estimates that renewable energy for new power generation capacity will draw 70% of all energy investment globally in 2021, with most of the investment flowing toward power and end-use sectors and moving away from conventional fossil fuel production.
Other renewable energy sources, such as solar and wind, have evolved as better alternatives due to vigorous research, development, and substantial capital investments. These alternative sources lead to tremendous power generation and require less operational costs than biomass power, drastically affecting the demand for biomass power.
Additionally, the incapacity of solar and wind energy to provide continuous power has been overcome with the evolution of battery energy storage systems. Solar and wind energy have become stable, confirming a steady power supply. Furthermore, the cost of these batteries is steadily declining to match the demands for battery energy storage systems from various industries. Thus, the low costs and widescale adoption of solar and wind energy may hinder the growth of the biomass power market during the forecast period.
The age of biomass energy has high operating costs and high capital expenditures. Feedstock procurement costs, transportation costs, costs associated with pre-treatment innovations of biomass, and the Levelized Cost of Electricity (LCOE), a calculation of the cost of producing power at the location of association with a heap or power framework, are a few of the significant costs involved with the biomass power age. Because capital costs and feedstock costs vary from location to location, the LCOE of biomass-powered power plants ranges from 6 to 29 cents per kWh.
Rising environmental concerns have enabled countries to use environment-friendly measures to generate power. This has given impetus to using biomass as a source of power generation. This growing demand for renewable energy sources has encouraged power generation through biomass, creating lucrative opportunities for the biomass power market.
The global biomass power industry has been segmented regionally into North America, Europe, Asia-Pacific, the Middle East and Africa, and South America. Europe dominates the market.
The European Union countries dominate the regional segment with a goal to pha4se-out coal-based power generation and adopt environment-friendly strategies. Europe is expected to grow at a CAGR of ~5.4%. In its long-term strategy and line with the Paris agreement, European Union has aimed to be carbon neutral by 2050. The European Union is also seeking a phase-out of coal, which is anticipated to increase demand for biomass energy.
Asia-Pacific is expected to grow at a CAGR of ~7.8%. Demand in Asia-pacific countries such as India and China is increasing due to its transforming economies. Demand for biofuel in Asia-Pacific is expected to grow with growing investment by public and private sectors to develop biofuel technologies.
The United States and Canada dominate North America's regional market. The region of North America relies heavily on coal to produce electricity. Gas-based power generation has increased more rapidly than coal-based power generation over the past ten years due to the recent discovery of shale gas reserves in the area. Most of the time, installers and system providers keep stock of large equipment.
The global biomass power industry is classified based on technology, feedstock, and regions.
The global biomass power industry has been segmented based on technology: combustion, anaerobic digestion, and gasification.
The combustion technology segment held the most significant volume accounting for 88.4% of the total revenue generated by all three technologies. This segment is expected to dominate the biomass power market during the forecast period.
A technology pathway known as "biomass gasification" uses a controlled process to convert biomass into hydrogen and carbon monoxide (CO) while also utilizing oxygen, heat, carbon dioxide (CO2), and steam. As a result of the process, energy is released that can be used for heating, cooking, producing electricity, and moving people and goods. Compared to conventional gas-powered systems, biomass gasifiers provide an ideal decentralized energy source at a reasonable price. In addition, a cutting-edge, effective, and clean biomass system for generating heat and electricity is provided by combining biomass gasification with steam and gas turbines. Currently, the market is driven toward growth by the quick depletion of fossil fuels and the abundant biomass supply.
Based on feedstock, the global biomass power industry has been segmented into solid biofuel, liquid biofuel, and biogas.
The solid biofuel segment was dominant in the market and estimates about 85.9% of total revenue generation among the three types of feedstock, owing to the easy availability and low cost of solid biofuels, resulting in higher adoption over liquid biofuels and biogas for power generation application.
An energy-efficient substitute, liquid biofuel lowers the risks to energy security and the pollution produced by burning fossil fuels. As a result, it can be used in large quantities in mixtures with conventional fossil fuels for purposes like transportation. Although biodiesel has the potential to replace conventional fuel, the current demand cannot be satisfied by its current production capacity. As a result, the market is heavily regulated, and various tax incentives are offered in different nations.
Agricultural waste, manure, municipal waste, plant material, sewage, green waste, and food waste are some raw materials used to make this mixture of gases. Methane and carbon dioxide comprised most of its composition, with very little water vapor and supplied compounds. When oxygen is present, this gas burns, releasing energy. This energy is employed for a variety of tasks, including the production of electricity, food preparation, transportation, and heating. The market is expanding due to growing environmental safety concerns and rising clean energy demand.
The COVID-19 pandemic has caused a global crisis, impacting all industries worldwide, including the renewable energy sector. The supply chain of the biomass power industry was majorly affected, resulting in a shortage of raw materials due to lockdown restrictions, further delaying the delivery process. Furthermore, there was a delay in various upcoming projects and a halt of on-site construction projects due to lockdown restrictions.
The lockdown also led to a reduction in power generation supplies due to the closure of operations.
However, supportive steps have been taken by the government of some countries, such as the US, Germany, and India, to extend the deadline for upcoming projects and the projects on-site to help them with the eligibility for incentives and tax credits. These measures are expected to boost the growth of the market for biomass power in the forecast period.