Harvesting Hope: Pellet Fuel’s Pivotal Role in Global Decarbonization

In a world grappling with the urgent need for decarbonization, the harmful effects of fossil fuel CO2 emissions on the environment have reached a tipping point. As we stand at the edge of profound climate shifts, the call for immediate action to transition to sustainable energy sources becomes increasingly imperative.

Understanding the Global Context

Recent reports from the Intergovernmental Panel on Climate Change (IPCC) emphasize the criticality of decarbonization to limit global warming and mitigate the impacts of climate change. The urgency has intensified, with 2023 marking a potential tipping point that could accelerate environmental changes.

Pellet Fuel as a Decarbonization Catalyst

Amidst the urgency, the search for practical, equitable solutions to power our societies has gained momentum. The transition away from fossil fuels necessitates “drop-in” replacements capable of sustaining our current infrastructure with minimal disruption. Pellet fuel, derived from (fast) regrowing biomass, emerges as a promising contender.

Building on existing initiatives in power, heat, and transport sectors, pellet fuel provides a unique solution to the variability challenges posed by wind and solar power. Its energy-dense composition, sourced from sustainably managed forests, makes it a viable carbon-beneficial replacement for coal in power generation. With torrefied pellets bringing further advantages to the table.

Pellet Fuel’s Role in Large-Scale Energy Storage

While the production fluctuations of renewable sources remains a concern, the potential of pellet fuel extends beyond mere substitution for basline power generation. As we grapple with the intermittency of wind and solar power, pellet fuel emerges as a bridge to the future. Large-scale energy storage solutions, often considered essential for a stable grid, find a powerful ally in the form of pellet fuel, delivering stored energy when needed. Other than batteries stooring electrical power, wood pellets store the capacity to produce heat and electricity at much lower cost. And while R&D in battery technologies is essential to cover the growing demand for electric power, pellets allow for immediate implementation as a Power-to-X approach.

Global Forest Management and Sustainable Practices

Ensuring the sustainability of pellet fuel hinges on responsible forest management. Collaborative efforts with international forestry organizations and policies supporting the responsible use of biomass are crucial. By adhering to sustainable practices, we can maximize the potential of managed, working forests as a continuous and renewable resource.

The Broader Landscape of Decarbonization

While pellet fuel plays a pivotal role, it is one piece of the larger puzzle of decarbonization. Integrated strategies involving renewable energy sources, energy efficiency measures, and advancements in carbon capture technologies are essential components of a comprehensive approach.

Pellet Fuel’s Impact on Global Energy Landscape

Statistics reveal a profound impact. In 2022, the global pellet fuel supply chain delivered the equivalent of a Panamax-size ship filled with stored energy every day of the year. This demonstrates not just the viability of pellet fuel but also its immediate potential in contributing to global decarbonization efforts. Sustainably managed forests and reforestation of wild fire areas ensure that sufficient biomass is available.

Towards a Sustainable Future

The journey towards decarbonization is complex, requiring multifaceted solutions. Pellet fuel’s ability to seamlessly integrate into existing infrastructure, coupled with its potential for large-scale energy storage, positions it as a vital asset in the global pursuit of a sustainable and low-carbon future. Advocating for policies that align with responsible biomass use ensures a harmonious transition, marking the beginning of the end of the fossil fuel era. As we collectively navigate this transformative period, pellet fuel stands as a beacon of hope, illuminating a path towards a cleaner, greener tomorrow.

References:

Biomass Magazine article by Bill Strauss

Bioenergy Europe article

Navigating the Green Horizon: The Current Landscape of Europe’s Green Deal and Its Corporate Impacts

Amidst the ongoing Russian-Ukrainian war and the escalating energy crisis, the European Green Deal has emerged as a pivotal initiative with profound implications for large businesses. This ambitious plan, approved in late 2019, seeks to achieve climate neutrality in Europe by 2050 and reduce greenhouse gas emissions by 55% by 2030 compared to 1990 levels. In this blog post, we explore the latest data and figures that underscore the impact of the Green Deal on industries and corporations.

Europe’s Pursuit of Climate Neutrality
The Green Deal’s comprehensive approach encompasses eight key segments, addressing biodiversity, sustainable food systems, agriculture, industry and mobility, clean energy, construction and renovation, and pollution elimination. As of the latest available data, Europe remains committed to becoming the world’s first climate-neutral continent by 2050. The plan includes strategies for transitioning industries, promoting sustainable food production, and fostering combustion engine-free transportation.

Why Embrace the Green Deal?
The imperative is clear: the planet is not just seeking help; it is crying out for it. Greenhouse gases, central to the greenhouse effect, are contributing to global warming, glacier melting, and rising sea levels. The urgency to reduce carbon dioxide concentrations, currently at their highest levels in the last 650,000 years, is evident. Utilizing renewable energy sources and implementing energy conservation measures are crucial components of the Green Deal.

The Mission of the Green Deal
The Green Deal’s mission is to restore nature to a reasonably acceptable state. The latest data reveals that the concentration of carbon dioxide continues to rise, reinforcing the critical need for action. Achieving this involves adopting innovative technologies and sustainable practices, addressing issues such as excessive fossil fuel consumption, deforestation, intensive livestock farming, and the use of nitrogen-containing fertilizers.

Impact on Large European Businesses
For many businesses, the Green Deal poses significant challenges, necessitating substantial investments in new technologies and sustainable solutions. Current figures indicate increased administrative burdens for European exporters of goods and services. However, uncertainties persist among businesses regarding the feasibility of the goals outlined in the Green Deal, with some deeming them unrealistic. Against the backdrop of the ongoing Russian-Ukrainian war, critics argue that it has posed additional challenges to achieving the Green Deal’s objectives. Consequently, achieving EU energy self-sufficiency is now perceived as a pressing priority.

Conclusion
As Europe charts its course towards climate neutrality, the Green Deal stands as a transformative force with far-reaching implications for businesses and industries. The latest data underscores the urgency of embracing sustainable practices and innovative technologies to meet ambitious targets, contributing to a healthier planet for future generations.

Another step towards carbon neutrality for France

France has decided to extend the operation of its last two coal-fired power plants until the end of 2024, as it anticipates increased demand during the winter months. Prime Minister Elisabeth Borne and Energy Transition Minister Agnès Pannier-Runacher signed a decree to this effect. While the country expects lower demand compared to the previous winter, they are taking precautions to ensure a reliable supply of French electricity.

During the previous winter, the French government reopened the Saint-Avold coal unit to reduce reliance on Russian energy and compensate for electricity shortages caused by damage to its nuclear reactor fleet. This was due to factors such as stress corrosion, which impacted the output of state-owned nuclear giant EDF, leaving just 30 of its 56 reactors operational.

Ongoing concerns about energy security have led to the extension of the operational life of the two remaining coal plants in Cordemais and Saint-Avold, beyond their initial closure dates. In 2017, President Emmanuel Macron pledged to close all of France’s coal-fired plants before 2022.

Agnès Pannier-Runacher has stated that the two coal units that will remain in operation contribute only 0.6% of the country’s total electricity consumption. The French government, however, remains committed to completely phasing out coal power by 2030 at the latest, a target that puts them ahead of some other European Union countries like Germany. Germany has indicated that a complete coal phase-out by 2030 is a best-case scenario, with 2038 being the worst-case scenario. Germany has also reactivated some coal-fired plants since 2021, which contradicts their previous commitment to phasing out coal by 2030.

Additionally, in March, the UK relied on reserve coal power to cope with increased demand at the end of a colder-than-expected winter, which is in conflict with their government’s target to phase out coal entirely by 2024.

A study by the NGO Global Energy Monitor published in April found that the retirement of operational coal power plants needs to accelerate significantly to meet the goals of the Paris Agreement. It also stressed that OECD countries should completely phase out coal by 2030 to avoid the worst effects of the climate crisis.

However, transitioning coal-fired power plants to biomass can significantly improve base-load energy and heat from renewable energy sources. Drax, a vertically integrated energy producer, is a good example for the energy transition.

EFI Report Maps Out a Policy Blueprint for BECCS Deployment

A recent report by the Energy Futures Initiative (EFI) has unveiled a comprehensive policy roadmap for the large-scale deployment of bioenergy with carbon capture and storage (BECCS). Titled “Taking Root: A Policy Blueprint for Responsible BECCS Development in the United States” the report highlights how BECCS can effectively contribute to decarbonization by permanently removing greenhouse gases from the atmosphere and accelerating the transition to a climate-friendly power grid. The report’s launch event in Washington D.C., hosted by the EFI Foundation and Resources for the Future, featured influential figures, including senators and energy experts, who emphasized the crucial role of BECCS in achieving global climate objectives.

The release of the EFI report marks a significant milestone in the development of BECCS policy, providing a comprehensive framework for its widespread implementation. By recognizing the unique potential of BECCS to deliver net-negative emissions on a large scale while ensuring a stable and economically viable energy supply, the report emphasizes the urgent need for a holistic policy approach. As policymakers and stakeholders explore the report’s recommendations, the deployment of BECCS stands poised to make a substantial impact on mitigating climate change, creating economic opportunities, and advancing sustainable environmental practices.

The European Energy Mix in 2021

Renewable energy was the largest contributor to primary energy production in the European Union in 2021, accounting for 41% of the total energy produced. This trend has been consistent since 2016, when renewable energy surpassed nuclear energy as the primary source. Nuclear energy was the second-largest source, making up 31% of the total energy production, followed by solid fuels at 18%, natural gas at 6%, crude oil at 3%, and other sources at 0.2%.

Source

The distribution of primary energy production among EU member states varied greatly. Renewable energy sources were the sole contributor to primary energy production in Malta, while in other countries it represented the majority share. For instance, Latvia had a share of close to 100%, followed by Portugal at 98% and Cyprus at 96%. On the other hand, solid fuels were the dominant source of energy production in Poland, Estonia, and Czechia, with shares of 72%, 56%, and 45%, respectively.

The largest share of natural gas production was observed in the Netherlands at 58% and in Ireland at 42%, where it was accompanied by renewables and biofuels at 49%. In contrast, Denmark’s primary source of energy production was renewables and biofuels at 48%, while crude oil had the largest share at 35%.

The EU had to rely on imports from third countries to meet 58% of its energy consumption, making it necessary to consider imports alongside production when assessing the EU’s energy requirements.

Petroleum products, including crude oil, constituted the primary imported energy product, accounting for nearly two-thirds of the EU’s energy imports in 2021 (64%). This was followed by natural gas (25%) and solid fossil fuels (6%).

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European-US Energy Council affirms the Importance of Cooperation

On April 4th, the Energy Council Ministerial Meeting between the EU and the US was held in Brussels to bolster cooperation in the energy sector. The Energy Council was chaired by EU High Representative/Vice-President Josep Borrell and Commissioner for Energy Kadri Simson, along with US Secretary of State Antony Blinken and US Deputy Secretary for Energy David Turk. The focus of the meeting was on energy security in Europe and neighboring regions, as well as joint efforts towards decarbonization.

During the meeting, the co-chairs discussed ways to ensure energy security while accelerating the transition to green energy. They addressed the situation in Ukraine and Moldova in the context of next winter’s outlook and deliberated on clean-energy technologies and energy savings to expedite decarbonization. Additionally, the two sides exchanged views on reducing methane emissions as initiators of the Global Methane Pledge.

In a joint statement, the EU and the US pledged to coordinate responses to maintain global energy markets’ stability and support the Paris Agreement’s goals. The statement also underscored the importance of reducing dependence on Russia for nuclear materials and fuel cycle services while backing affected EU countries’ efforts to diversify nuclear fuel supplies.

Following the meeting, a Memorandum of Understanding was signed between the TotalEnergies Anomaly Detection Initiatives (TADI) of the Pôle d’Etudes et de Recherche de Lacq and the Colorado State University Methane Emission Technology Evaluation Center (METEC) to establish international standards for methane leak detection and quantification solutions.

The EU and the US are strategic partners working hand in hand to push for ambitious climate action, net zero emissions, and enhanced energy security while promoting energy diversification. The EU-US Energy Council is the principal framework for cooperation on mid and long-term issues, accompanied last year by the EU-US Task Force on Energy Security to tackle the energy crisis triggered by Russia’s invasion of Ukraine. The Commission and the White House published a progress report on the Task Force’s work, outlining priorities for 2023.

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Stronger Legislation to Help with Rollout of Renewable Energy


The European Union has taken another step towards achieving its renewable energy goals with the provisional agreement reached between the European Parliament and the Council to reinforce the Renewable Energy Directive. This agreement strengthens the EU’s binding renewable energy target for 2030 to a minimum of 42.5%, up from the current 32% target, and almost doubling the existing share of renewable energy in the EU. The objective is to achieve 45% of renewables by 2030, demonstrating the EU’s commitment to gain energy independence and meet the EU’s 55% greenhouse gas emissions reduction target for 2030.

The new law aims to make permitting procedures easier and faster, recognizing renewable energy as an overriding public interest while preserving a high level of environmental protection. Additionally, the agreement includes targets and measures to support the uptake of renewables across various sectors of the economy, including heating and cooling, district heating systems, and industry. For the first time, industry is included in the Renewable Energy Directive, with indicative targets and a binding target to reach 42% of renewable hydrogen in total hydrogen consumption in the industry by 2030. The agreement also reinforces the regulatory framework for renewable energy use in transport, including a sub-target of 5.5% for advanced biofuels and renewable fuels of non-biological origin, supporting the EU’s ambitions on renewable hydrogen roll-out.

The agreement also strengthens the bioenergy sustainability criteria, ensuring that forest biomass is not sourced from certain areas with a particular importance from a biodiversity and carbon stock perspective. The revised Directive includes provisions to ensure that woody biomass is used according to its highest economic and environmental added value, and financial support is banned for energy produced through the use of certain types of biomass.

The European Green Deal is the EU’s long-term growth strategy to make Europe climate-neutral by 2050. The revision of the Renewable Energy Directive is one of the ‘Fit for 55’ proposals presented by the Commission in July 2021 to make the EU’s climate, energy, land use, transport, and taxation policies fit for reducing net greenhouse gas emissions by at least 55% by 2030. The agreement brings the EU closer to becoming the world’s first climate-neutral continent by 2050 and achieving the REPowerEU Plan, which is the EU’s strategy to reduce its dependence on Russian fossil fuel imports as soon as possible. The new legislation will be published in the Official Journal of the Union and enter into force once it is formally adopted by the European Parliament and the Council.

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Carbon Mitigation by Substituting Fossil Fuels with Wood Pellets

Climate change is one of the biggest challenges of our time, and reducing carbon emissions is crucial to addressing it. Fossil fuels have been the primary source of energy for a long time, but their use has led to an increase in greenhouse gas emissions. As such, alternatives that can mitigate the carbon footprint of fossil fuels are being explored. One such alternative is wood pellets, which can be used as a substitute for fossil fuels like coal, oil, and natural gas. In this article, we explore the role of wood pellets in carbon mitigation, their benefits, challenges, and how they can contribute to a sustainable energy future.

Introduction: The Need for Carbon Mitigation

The increase in atmospheric carbon dioxide (CO2) concentration resulting from human activities, especially the burning of fossil fuels, is one of the primary drivers of climate change. Carbon mitigation is, therefore, a critical strategy to reduce greenhouse gas (GHG) emissions and limit the extent of global warming.

Carbon Mitigation is the process of reducing or offsetting GHG emissions to decrease the concentration of CO2 in the atmosphere. The goal of carbon mitigation is to limit the extent of global warming and its adverse impacts, including more frequent and severe weather events, rising sea levels, and biodiversity loss.

To achieve carbon mitigation, we need to reduce our reliance on fossil fuels, which are finite, non-renewable, and emit large amounts of CO2. Sustainable alternatives to fossil fuels, such as wood pellets, can play a crucial role in reducing GHG emissions and mitigating climate change.

The Role of Wood Pellets in Carbon Mitigation

Wood pellets are a type of biomass fuel made from compressed sawdust, shavings, and other wood residues. They are used as a renewable energy source in residential, commercial, and industrial applications.

Wood pellets have a lower carbon footprint compared to fossil fuels because they are made from renewable and sustainably managed forest resources. Moreover, the process of producing wood pellets is less carbon-intensive than the production of fossil fuels.

Using wood pellets as a fuel source can also help reduce GHG emissions by replacing fossil fuels in heating and electricity generation. In addition, the use of wood pellets promotes the circular economy by utilizing waste materials from the forest industry that would otherwise go to landfills.

Benefits of Substituting Fossil Fuels with Wood Pellets

The substitution of fossil fuels with wood pellets offers numerous benefits, including:

a) Reducing Carbon Emissions and Combating Climate Change: The use of wood pellets as a renewable energy source reduces GHG emissions and helps mitigate climate change. Replacing one ton of coal with wood pellets can reduce CO2 emissions by approximately 1.5 to 2.5 tons.

b) Cost-Effective and Sustainable Energy Solution: Wood pellets are a cost-effective and sustainable alternative to fossil fuels, with stable prices and a low environmental impact. In addition, the use of wood pellets contributes to rural economic development by creating jobs in the forestry and biomass sectors.

c) Contributing to Local Economic Development: The production and use of wood pellets can help create local economic opportunities in rural areas by utilizing locally sourced biomass and providing employment in the forestry and biomass industries.

Challenges in Substituting Fossil Fuels with Wood Pellets

While the substitution of fossil fuels with wood pellets offers many benefits, there are also some challenges to consider, including:

a) Supply Chain and Logistics Challenges: The production and transportation of wood pellets require significant logistical efforts, including harvesting, transportation, and processing. The cost of these activities can be a barrier to widespread adoption of wood pellets as a fuel source.

b) Environmental and Social Concerns: The production and use of wood pellets can raise environmental and social concerns, such as deforestation, soil erosion, and loss of biodiversity. These issues need to be addressed through sustainable forest management practices and regulations.

c) Policy and Regulatory Frameworks: The success of wood pellet substitution depends on supportive policy and regulatory frameworks that promote sustainable forest management, incentivize the use of renewable energy, and reduce barriers to market entry.

Success Stories and Best Practices in Wood Pellet Substitution

There are several successful examples of wood pellet substitution, including:

a) The North American Experience with Wood Pellet Substitution: The United States and Canada have experienced significant growth in the use of wood pellets as a renewable energy source. This growth has been driven by incentives such as renewable energy targets, tax credits, and subsidies.

b) European Success Stories and Lessons Learned: Europe has been a leader in the use of wood pellets as a renewable energy source. Countries such as Sweden, Denmark, and Austria have successfully integrated wood pellets into their energy mix, with biomass accounting for a significant proportion of their energy production. The European experience highlights the importance of sustainable forest management, stakeholder engagement, and supportive policy and regulatory frameworks.

Best practices in wood pellet substitution include:

  • Ensuring the sustainability of the forest resource by promoting responsible forest management practices.
  • Engaging with stakeholders, including local communities, to address social and environmental concerns and ensure a socially responsible transition to renewable energy.
  • Developing supportive policy and regulatory frameworks that incentivize the use of renewable energy, reduce barriers to market entry, and promote sustainable forest management.
  • Encouraging innovation and investment in research and development to improve the efficiency of wood pellet production and increase the use of biomass in energy production.

Conclusion: The Future of Carbon Mitigation with Wood Pellets

Wood pellets have the potential to play a significant role in carbon mitigation by substituting fossil fuels with renewable and sustainably sourced biomass. While there are challenges to widespread adoption, such as supply chain and logistics challenges and environmental and social concerns, best practices and successful examples from North America and Europe provide valuable lessons.

The growing role of wood pellets in carbon mitigation presents opportunities for rural economic development, sustainable forest management, and a transition to a low-carbon economy. The future of carbon mitigation with wood pellets depends on supportive policy and regulatory frameworks, innovation and investment in research and development, and collaboration between stakeholders to address environmental and social concerns and ensure a socially responsible transition to renewable energy.

Steps to Improve on EU’s Foreign Climate Policies

The European Union (EU) has a significant role in leading the worldwide shift towards addressing climate change. To achieve this goal, the EU needs a solid mandate for its climate foreign policy that takes into account the current multi-crisis situation. The EU can establish this mandate at the upcoming Foreign Affairs Council (FAC) meeting in February, which has the following objectives:

  1. Establish global agreement on ending the use of fossil fuels, with the EU taking a leading role in implementing it domestically.
  2. Mobilize EU and international finances to support countries affected by the global energy, food, and economic crisis.
  3. Use EU industrial and trade policies, and diplomatic efforts, to encourage other major carbon emitters to speed up their own decarbonization efforts.

The EU has already taken a step in the right direction by calling for a worldwide coal phase-out at the 2021 FAC meeting, which paved the way for a global agreement on reducing the use of coal at the COP26 conference. The upcoming February FAC meeting must build on this success and maintain the EU’s leadership position in the transition to a green economy. This year’s climate diplomacy FAC will take place in a more complex environment due to the Russian war in Ukraine and the pressure on global energy and food markets.

The EU’s mandate at the FAC meeting should aim to:

  • Encourage a full global commitment to phase out fossil fuels and accelerate the phase-out of coal.
  • Push for reforms that increase access to finance for developing countries to transition to a green economy.
  • Provide incentives for other major carbon emitters to hasten their own transitions through the use of industrial and trade policies.

By demonstrating its own commitment to the green transition, the EU can inspire a global consensus to end the use of fossil fuels. However, the EU’s recent efforts to replace Russian fossil fuel imports with alternative sources have tightened global gas markets and risk being misinterpreted as a return to coal. A clear mandate for the green transition would show the EU’s commitment to its own climate targets, demonstrate how it is phasing out fossil fuels, and aim to drive a global phase-out of fossil fuels.

The EU can also signal its support for climate-vulnerable countries by mobilizing transition and impact response finance for developing countries. This can be achieved by supporting innovative mechanisms and reforms to multilateral financial institutions that help these countries deal with the impacts of climate change and high debt levels. The EU can also promote Just Energy Transition Partnerships, mobilize finance for adaptation and loss and damage, and work towards broader financial system reforms.

By taking a new approach to diplomatic engagement with other major carbon emitters, the EU can encourage these countries to make their own commitments. The EU can lead by example by setting its own ambitious targets for 2035/2040 NDCs and use its Green Deal diplomacy to incentivize other major emitters to take action. The EU can maximize its diplomatic impact by working together with developing countries to overcome political and economic hurdles.

In 2023, the EU should set the following key targets for its climate and energy diplomacy:

  • A global fossil fuel phase-out mandate and progress towards phasing out coal globally.
  • Financing for the global transition to a green economy and responding to the impacts of climate change.

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Biomass Policies in Germany, The Netherlands and France

European countries have been increasingly adopting renewable energy policies to reduce their dependence on fossil fuels and combat climate change. Among the renewable energy sources, biomass has gained significant attention, particularly in Germany, the Netherlands, and France.

Germany has been a leader in the production and consumption of biomass. The country has a well-established wood processing industry, which provides a solid base for the production of wood chips and pellets, which are used as biofuels. The German government has implemented various policies to support the growth of the biomass sector, including tax incentives and subsidies for the production and use of biomass. Additionally, Germany has set a target to increase its renewable energy share to 80% by 2050, with a significant portion of this target being met through the use of biomass.

The Netherlands, like Germany, has a strong wood processing industry and is a leading producer of wood pellets. The government has implemented policies aimed at increasing the use of biomass in the country, including tax incentives and subsidies for the production and use of biomass. The Netherlands has set a target to reduce its greenhouse gas emissions by 49% by 2030, with the use of biomass playing a crucial role in achieving this target.

France has also been actively promoting the use of biomass as a source of renewable energy. The government has implemented various measures to support the growth of the biomass sector, including subsidies for the production and use of biomass. France has set a target to increase its share of renewable energy to 40% by 2030, with the use of biomass expected to play a significant role in achieving this target.

In conclusion, Germany, the Netherlands, and France are among the leading European countries in the promotion and adoption of biomass as a source of renewable energy. The governments of these countries have implemented various policies aimed at supporting the growth of the biomass sector, with the aim of reducing their dependence on fossil fuels and achieving their renewable energy targets.

What’s new with Germany’s Renewable Energy Scheme?

The revision of a German program to encourage the production of power from renewable energy sources has been authorized by the European Commission in accordance with EU State Aid regulations. The program reflects a recent revision to Germany’s Renewable Energy Act (also known as “EEG 2023”) and will help the country meet its energy and environmental goals as well as the EU’s strategic goals for the European Green Deal.

Germany informed the Commission of its proposals to extend and change its renewable energy assistance program, largely replacing the current support provided under the EEG 2021 program, which the Commission approved in April 2021 (SA.57779) and updated in December 2021 (SA.64376) and September 2022. (SA.102303). The modified program will be in effect through the end of 2026.

With a total budget of €28 billion, the EEG 2023 support program seeks to produce 80% of the power it consumes from renewable sources by 2030 and achieve carbon neutrality by 2045.

According to the plan, the assistance will often come in the form of a market premium that the network operator pays the producer in addition to the market price for the electricity. The aid will, however, come in the form of feed-in tariffs for relatively tiny installations. Through competitive, open, and nondiscriminatory bidding processes, beneficiaries will be chosen.

There will be separate tenders for each technology. The volume and quantity of innovative bids, as well as those for rooftop and ground-based solar photovoltaic, onshore wind, and biomethane, will both rise in Germany.

The amendments are:

To increase competition, further reduce the possibility of overcompensation, and keep costs down for customers and taxpayers, tender procedures are improved. In particular, the plan adds an efficient volume control mechanism for innovation, solar photovoltaic, and biomethane tenders on top of the existing safeguards for onshore wind and biomass. In order to prevent undersubscription, a mechanism exists that enables adjusting the volumes offered for each technology.

To deal with Germany’s grid congestion problems, a new temporary solution is presented. In order to address the higher costs of deploying renewable energy in the region and ensure that projects are developed where more electricity consumption occurs, regional measures will promote the development of electricity production from onshore wind, biomass, and biomethane in the South of Germany.

In order to avoid overcompensating producers, Germany will totally phase out its support for the production of renewable electricity during periods of negative pricing (i.e., when demand declines and prices rise) as of 1 January 2027.

The Commission evaluated the German program’s amendment in accordance with EU State Aid regulations, including the CEEAG 2022 Guidelines on State Aid for Climate, Environmental Protection, and Energy.

The European Commission’s findings:

In order to encourage the creation of renewable energy sources and lower greenhouse gas emissions, the plan is acceptable and required. Additionally, the plan improves grid stability.

The scheme’s good environmental advantages outweigh its negative implications in terms of competition distortions, making the aid appropriate since it is confined to the bare minimum required. In specifically, a premium based on the lowest bids in an open and transparent bidding process is used to provide the help. In order to guarantee that the tenders are competitive, the tenders also incorporate an adequate volume control mechanism for all technologies. Additionally, the assistance is capped at a sum determined by the funding gap, which is the sum required to construct initiatives. In the future, market signals will be less distorted because support during periods of low prices will be taken out.

Germany has created a comprehensive strategy for the independent economic evaluation of the EEG 2023 in accordance with the evaluation requirement envisioned by the CEEAG. Germany has also committed to improving data collection and the application of empirical methodology in this regard.

In accordance with EU State Aid regulations, the Commission accepted the change of the German plan on this basis.

Amendments to a German program (German Offshore Wind Energy Act – “WindSeeG”) to boost offshore wind energy generation in Germany have been authorized by the European Commission in accordance with EU State Aid regulations. The program supports the German Renewable Energy Act (Erneuerbare Energien Gesetz, or “EEG 2023”) and will help the EU achieve its strategic goals for the European Green Deal as well as Germany’s energy and environmental goals.

Germany informed the Commission of its intention to modify the current WindSeeG program in order to advance offshore wind energy production in Germany. The initial plan was approved by the Commission on July 23, 2014 (SA.38632), and it was repeatedly extended and changed until it was finally updated in 2021 (SA.57610), all in accordance with the 2014 Guidelines on State Aid for Climate, Environmental Protection, and Energy.

An increase in the expansion goals for offshore wind energy plants’ installed capacity from 20 GW to at least 30 GW by 2030, at least 40 GW by 2035, and at least 70 GW by 2040;


In the German Exclusive Economic Zone (‘EEZ’), there is a new tender process for a different kind of site that allows offshore wind electricity companies to bid for locations that have not been centrally pre-investigated by the German government. Germany hopes to accelerate and enhance offshore wind development with this new approach.


A dynamic bidding process that will enable Germany to distinguish and choose amongst numerous bids with a bid value of zero for tenders for non-centrally pre-investigated sites.

The Commission evaluated the modified plan in accordance with EU State Aid regulations, including the CEEAG Guidelines for State Aid for Climate, Environmental Protection, and Energy (effective January 2022).

In order to encourage the use of renewable energy sources and lower greenhouse gas emissions, the Commission determined that the measure is still necessary and appropriate.

The Commission also discovered that the assistance is reasonable and kept to a minimum. The Commission also concluded that the scheme’s benefits, particularly those related to the environment, outweigh any potential drawbacks in the form of competitive distortions. The aid is specifically given as a premium over the market price of power, based on the lowest offers in an open and transparent bidding process. The amount of assistance is capped at a level determined by the funding gap, which is the sum required to build initiatives.

Germany has created a comprehensive strategy for the independent economic evaluation of the program in accordance with the evaluation requirement envisioned by the CEEAG and has committed to improving data collection and the use of empirical approaches in this regard.

In accordance with EU State Aid regulations, the Commission approved the modified German program on this basis.

Based on two press releases by European Commission titled “State aid: Commission approves modification of German scheme to support electricity production from renewable energy sources” and State aid: Commission approves amendments to German scheme to support offshore wind energy generation both of which were released on December 21, 2022

The US Inflation Reduction Act in Detail

The Inflation Reduction Act (IRA) is the single most important measure ever taken to lessen climate change’s effects in the US. The federal government is spending hundreds of billions of dollars to mobilize industrial and economic policies in favor of clean energy and to hasten the decarbonization of the entire economy.

However, President Biden’s proclamation of this law’s passage is just the beginning. Many of the IRA’s most innovative initiatives are far from prescriptive in their interpretation, and now it is up to federal agencies, state governments, state energy offices, regulators, and utilities to decide how these new powers will be used and how financing will be distributed.

This is a significant victory for Congress that marks the beginning of a new phase in the development and deployment of clean energy in the United States. In order to lower carbon emissions in the power sector and restore the country’s energy infrastructure, the IRA expressly introduces numerous important initiatives and incentives targeted at utilities.

Utilities and grid operators will be required to adapt to an influx of advanced energy technologies, shifting consumer demands, and rising regulatory expectations that will change how we generate, distribute, and consume electricity. Its numerous new and expanded incentives for consumers to adopt things like electric vehicles, heat pumps, solar systems, and batteries.

A wide range of distributed energy resources (DERs)—including renewable energy, energy efficiency, and other cutting-edge energy systems placed in homes and businesses—are eligible for additional incentives. Numerous of these initiatives are targeted towards lower-income, disadvantaged, and indigenous households and are designed to reduce the up-front costs associated with their switch to clean energy.

The transportation industry is given special attention in the IRA with new and enhanced incentives for electric cars and commercial vehicles as the source of almost 30% of greenhouse gas emissions in the U.S. These initiatives broaden tax benefits for infrastructure for vehicle charging stations and cover both new and old cars.

Accelerating the deployment of carbon-free generators is the main objective of one of the largest financing tranches under the IRA, and both DERs and utility-scale energy systems are eligible for new and enhanced incentives. Notably, the IRA increases the investment and production tax credits and adds new direct payment mechanisms, making these incentives available to local governments, nonprofits, places of worship, and other entities without tax obligations to balance.

The budding business can now benefit from very large subsidies for clean, renewable hydrogen technologies. For the first ten years that a facility is in operation, the IRA administers a production tax credit with multipliers for prevailing wage and apprenticeship criteria.

In addition to lowering carbon emissions, the IRA increases and alters the incentives for projects that verifiably absorb and store carbon.

The nation will require a dependable and expanded transmission system to transmit the energy from where it is produced to where it is used as the amount of new renewable energy entering the electric grid increases. The IRA funds new transmission and makes investments to expedite the siting of new infrastructure, which can typically take years to complete, especially when cables traverse many authorities and properties.

One of the few sticks in legislation stuffed with climate carrots, the new law seeks to minimize methane emissions in the extraction, transportation, and combustion of natural gas. The IRA not only adds additional reporting requirements but also harsh fines for methane leaks and financial support for reduction initiatives.

With its numerous energy and tax features, the Inflation Reduction Act ushers in a new clean energy era for the American economy that will revolutionize utility grid management and long-term planning.

The articles and the financial implications are outlined in this ICF article.

The Impact of Wild Fires on the Biomass Industries

The most recent version of the Joint Research Centre’s (JRC) Annual Report on Forest Fires in Europe, the Middle East, and North Africa was released in 2021. According to the report, last year’s fire season was the second worst in terms of burned territory on EU territory (since records have been kept since 2006), trailing only 2017 with nearly 10,000 km2 burned. More than 5,500 km2 of land burned in 2021—an area more than twice the size of Luxembourg—with over 1,000 km2 of that land burning inside protected Natura 2000 areas, the EU’s biodiversity reserve.

When analyzing early data on the effects of wildfires in the current year, the yearly reports allow the use of previous fire seasons as a reference. In light of this, 2022 appears to be even worse, supporting the unsettling destructive trend of recent years. In reality, this year has seen the burning of an area measuring 8,600 km2. By the end of October, this was one of the largest areas in Europe that had been burned by wildfires, breaking previous records for burned land in nine EU nations. Wildfires have burned across 35,340 km2 of land since the worst fire season on record in 2017, an area greater than Belgium. More than 11,600 km2 or around 35% of the overall burned area was located in the Natura 2000 network area.

Major conclusions of the report

Mapped fires in 2021 burned 500,566 hectares (ha) in total, greater than the expected 340,000 ha in 2020 but significantly less than the 1 million ha of 2017;

According to the 2021 report on forest fires, Italy was the nation with the greatest amount of burned land, followed by Turkey, Portugal, and Greece, particularly in August;

Wildfires severely impacted Europe’s Natura 2000 protected sites: in 2021, 102,598 ha (or roughly 20% of all Natura 2000 sites’ total area) were burned, which was less than the previous two years and significantly less than the average of the previous ten years;

Burnt areas increased compared to 2020 in southern EU countries, and it was the second-worst year for average fire size since 1986. The total number of fires was the lowest ever, resulting in significantly fewer but larger fires.

The EU Civil Protection Mechanism was improved with rescEU in 2019 and substantially strengthened in order to support countries throughout this fire season in 2021.

Six nations have requested planes, helicopters, and firefighters 11 times this year alone, making it the second year in the last ten years with the most requests to the EU Civil Protection Mechanism.

Bad Lauterberg, Harz
© H. Streetz | Bad Lauterberg, Harz
Translation: Caution! Dead wood. Danger of Death!

Two major impacts are mutually dependent

The increase in wildfires is clearly a sign of changing climate. However, there is another factor accounting for the severity of these fires being so devastating and large: Pest infestations.

We are seeing a global increase in forest infestations with beetles and other varmints. In Germany, many areas such as the Harz are suffering from almost 100% forest decline of trees with a diameter of >25 cm. I spoke with forestry workers in Bad Sachsa, who were preparing dead logs for the harvester to process. They are snowed under with work now and know that the next ten to twenty years will be very tough for the forest industry. Forest owners have to afforest and give the trees time to regrow to ensure a sustainable forest management.

This will have a significant impact on the timber value chain, affecting construction wood and biomass alike. As less wood is available for construction wood and furniture, less sawdust is available for wood pellets. The thinning of regrowing forest cannot compensate for the sawmill residues. This development will increase the cost pressure on the aforementioned industries and might snooker achieving the European Green Deal goals and the energy transition towards renewable energies.

The Essence of 2022’s Statistical Pellet Report

Bioenergy Europe published the Statistical Pellet Report for 2022.

The total amount of pellets produced by the EU27 increased significantly, or by roughly 9%, in 2021. This relative growth translates into a growth in absolute terms of 1.636.119 tonnes. With 3.355.000 tonnes, Germany continues to be the EU27’s top producer, significantly outpacing Lithuania, which came in second with 2.108.400 tonnes. Seven of the top ten manufacturers in the world are located in the European Union. Other than Germany and Lithuania, the top producers globally include Sweden, France, Poland, Austria, and Estonia. Between 2020 and 2021, the rest of Europe (outside the EU27) also experienced a large growth of about 15%, or an absolute increase of about 200.000 tonnes. This number might appear to be low, but it is actually low because Russia, Belarus, and Ukraine were not included in the data for this report’s edition.

In absolute terms, North American production increased by just over 500.000 tonnes between 2020 and 2021, or around 4%. It’s important to note that this gain is nearly entirely the result of Canada’s output growth, which grew by 15% or 490.000 tonnes. The USA, the other nation included in this aggregate, saw a less than 1% increase in production. With about 9,3 million tonnes produced in 2021, the US is remain the world’s top producer of pellets.

Unfortunately, the South American data that has been gathered is only available for Brazil and Chile, the continent’s two biggest pellet producers. Therefore, this must be considered when drawing generalizations about South America as a whole. Unfortunately, no funding could be secured from Chile this year. The production in 2021 is 17% more than it was in 2020, or a total rise of 190.000 tonnes, although this gain is solely attributable to an increase in Brazilian production. Given the dearth of statistics, it seems likely that the rise in production in South America is higher than 17%.

Since no contribution from Oceania was received this year, it is regrettable that it is not possible to confirm the anticipated increase in production capacity in Australia that was stated last year. As a result, the data is updated to 2020. Even though there were the same number of production locations, we can nevertheless see an increase in actual production in New Zealand.

Due to challenges acquiring data, production in Asia (mostly Southeast Asia Plus Japan, South Korea, and China) cannot be calculated with any degree of accuracy. Thus, production in 2021 will be comparable to that in 2020. However, it is likely that output increased as well because continental consumption climbed by around 33% between 2020 and 2021. No data for China is shown in this study due to the unpredictability of the country’s pellet market. Accurate figures are hard to come by because of the vastness of the nation and the dominance of small producers on its market. In addition, it’s unclear what kind of pellet China is manufacturing (whether wood pellets or agropellets). In any case, it appears that the Chinese market is entirely domestic (there are essentially no imports or exports), which has very little effect on the world supply and demand.

Africa is still an undeveloped market for pellets today. Despite the continent’s significant wood supply, the pellet sector is still in its infancy. However, recent investments in the manufacture of wood pellets in Africa (mostly in South Africa and Gabon) have resulted in a marked increase in pellet output, which will be seen in the upcoming years.

For more information, visit Bioenergy Europe.

40+ Countries Pledge to Phase Out of Coal

The Paris Agreement’s goal of 1.5°C in focus, more than 40 countries pledge to phase out coal by 2040.

Coal without carbon capture, mitigation or set off is the most polluting fossil fuel. Coal is also very handy, as transport and storage are easy. This makes it more difficult to phase out and establish low-carbon alternative fuels. Sustainably sourced biomass feedstocks are such an alternative, as they can also be stored, transported and used easily whenever needed. The big difference is the carbon cycle. Fossil fuels took hundreds of millions of years to build and emmit carbondioxid without taking it up in the near future. Sustainably sourced biomass introduces new carbon into the biosphere like coal does. However, new growing trees store the amount emitted from burning. The additional carbon from processing and transport can be sett off with other instruments as they will rely on fossil fuels for some time. Some coal stations have been converted to operate on biomass, which improves the environmental footprint of these facilities significantly while saving jobs and keeping infrastructure costs low.

The housing industry has a huge carbon saving potential. Bioenergy is a useful way to remove coal and gas from the these energy systems without increasing energy security risks. Bioenergy makes an excellent base load compared to wind and solar, as it is available independent from the weather.

Sources:

DGSB

UKCOP26

COP26 Sustainability Declaration

A coalition of thirteen wood bioenergy companies and organisations signed a declaration on sustainability. The declaration envisions the ambitious industry goals for growth to support the global net zero strategy. Existing wood bioenergy technlogies already help to deliver sustainable renewable energy and will further support the EU’s goals as the industry grows.

https://sustainablebioenergy.org/declaration/

The signatories are well known companies from the woody biomass industries, siuch as

Drax Group
https://www.drax.com/

Drax is a vertically integrated power supplier with own wood pellet production facilities in the United States. The biomass subisidary is Drax Biomass.

Enviva
https://www.envivabiomass.com/

Enviva Biomass is world’s largest supplier of sustainable woody biomass. The company operates several wood pellet plants in the United States with a focus on the South East.

Graanul Invest
https://graanulinvest.com

Graanul Invest is the largest European wood pellet supplier. The company mainly operates in the Baltics. In the United States Graanul Invest produces wood pellets in their plant in Texas.

Fram Renewable Fuels
http://framfuels.com/

Fram Fuels is a US wood pellet producer with three facilities. The main source is sustainably grown white southern pine.

US Industrial Pellet Association (USIPA)
https://theusipa.org/

The United States Industrial Pellet Association is a non-profit trade association that promotes sustainability and safety practices within the US wood energy industries.

Fit for 55

‘Fit for 55’ is the EU package delivering on the 2030 Climate Target to climate neutrality.

The EU has set ambitious targets for reducing net emissions by at least 55% by 2030 compared to 1990. Reaching this goal targets on being the first climate neutral continent by 2050. The package of proposals is the approach to make the EU ‘fit for 55’ and deliver on the questions that arise with the goal. All share the benefits of more space for nature, cleaner air, cooler and greener cities. Thus, the opportunity to take action is open to all innovators and investors, companies and cities, consumers, households and individuals. The challenge is a swift green transition, while strengthening competitiveness, job creation and positive impacts of the transition.

The European Green Deal is the blueprint for transformational change. There is growing public support for climate ambition and action. The proposals fundament are policies and legislation the European Union has already put in place.  The package is based on evidence. The 2030 Climate Target Plan assesses the opportunities and costs of the green transition, and showes that the balance is a positive one if we get the policy mix right.

The Fit for 55 Package alone is not enough and cannot deliver the global emission reduction the world needs. However, the EU remains committed to the multilateral global order and calls upon partners around the world to work together. The 26th United Nations Climate Change Conference of the Parties (‘COP26’) in Glasgow in November 2021 is one of the events for global target setting.

“The Fit for 55 Package: At a glance

The Fit for 55 package consists of a set of inter-connected proposals, which all drive towards the same goal of ensuring a fair, competitive and green transition by 2030 and beyond. Where possible existing legislation is made more ambitious and where needed new proposals are put on the table. Overall, the package strengthens eight existing pieces of legislation and presents five new initiatives, across a range policy areas and economic sectors: climate, energy and fuels, transport, buildings, land use and forestry. The legislative proposals are backed by impact assessment analysis, which takes into account the interconnection of the overall package. The analysis shows that an over-reliance on strengthened regulatory policies would lead to unnecessarily high economic burdens, while carbon pricing alone would not overcome persistent market failures and non-market barriers. The chosen policy mix is therefore a careful balance between pricing, targets, standards and support measures. Support measures•Using revenues and regulations to promote innovation, build solidarity and mitigate impacts for the vulnerable, notably through the new Social Climate Fund and enhanced Modernisation and Innovation Funds.” European Commission

Full content available here.

European Parliament votes in favor of the Biodiversity Strategy

In the plenary session on June 7th, the European Parliament debated and passed the Biodiversity Strategy. The strategy is non-binding. However, it calls for revising and aligning EU rules on the use of biomass for energy production with the objectives of the Biodiversity Strategy. Amendment 17, which would have benefited bioenergy, failed. The Biodiversity Strategy is awaiting approval from the Council. 

“The debate was opened by Rapporteur César Luena (S&D, ES) who began by thanking scientists, activists, NGOs, and young people. He argued that the text is well balanced and well negotiated and repeated the call for a binding biodiversity law. He argued that biodiversity and climate need to be solved together. He acknowledged that there are a lot of opinions on forest, and it is important to take them into account, but it is essential to protect primary and old growth forests. He concluded by saying any transition must be socially and environmentally sustainable.” comments Bioenergy Europe. And furthermore summarizes that “The debate concluded with the Commissioner for Environment, Oceans and Fisheries, Virginijus Sinkevičius, who stressed the importance of recognising and supporting farmers, foresters, and fishermen to transition towards sustainability, but it is not possible to lower the ambition on protecting biodiversity to promote cooperation and inclusiveness. He argued that although forests in Europe have been increasing in quantity, they are under increasing pressure, so their protection is crucial. He concluded by mentioning that a new forest strategy will be presented in July.”

For further information contact Bioenergy Europe.

Technical Committee on Sustainable Biomass and Biofuels Meeting

The technical committe will hold the next meeting on sustainable biomass and biofuels on 8th June 2021. The committee’s aim is to review the REDII Forest Biomass Operational Guidance. The supra-national bioenergy association Bioenergy Europe “encourages national associations to reach out to their governments in advance of the meeting if they have not done so to share Bioenergy Europe’s reply and their concerns.” 

Coal-to-Biomass conversion in Germany

To convert coal power plants to biomass power plants, Germany requires contracts for difference (CfDs) to make them profitable under current market conditions.

Fuel costs hinder German power plants from being profitable when switching to biomass based raw material. In order to make the conversion profitable, Germany needs to introduce CfDs, as used in UK. CfDs have the advantage of minimising profitability risks and increasing the probability of investments.

“Enervis estimates electricity production costs at €105-120/MWh for a 10-year funding period if a plant is commissioned in 2026. Annual funding for plant is estimated at €33-46/MWh, depending on several factors, such as the location and capacity of the plant, fixed costs and others. The average annual funding is estimated at €37/MWh.

In addition, the development of wholesale power prices is a factor in determining funding needs. Power prices will depend on the development of CO2 prices. Under this scenario, CO2 prices are estimated at €44/t CO2e in 2030.” Argus Media

Implementing a coal-to-biomass strategy would increase the base load capacities of renewable energy in Germany.

Enervis Study in German.