Global wood pellet usage expected to rise, experts say

MADISON, Wis. -- Biomass energy experts are predicting continued global growth in consumption of wood pellets for energy worldwide during the next decade. The big market for wood pellet energy is Europe, where consumption grew 14% from 2017 to 2018, according to the European Pellet Council, consuming 27 million tons, but the worldwide market is broadening.

Much more growth is expected in Asia. Korea and Japan are replacing coal and oil for electrical generation and other industrial uses, according to Global Market Insights, an energy data firm. The global market for wood pellets has grown past $19 billion, according to the firm’s estimates. Korea is pushing to reduce its use of coal and oil and increase its use of renewable fuel from 7% of total consumption to 20% by the end of 2030.

At the same time pellets present a favorable environmental profile, particularly against coal but also compared to old heating oil boilers used in various residential and commercial applications based on statistics from Biometrics, LLC. Demand world wide for heating pellets increased 2.5 times in 7 years, according to an article in Canadian Biomass article. Exports from North America are booming, with tonnage having more than doubled in the last seven years.

The U.S. has pellet plants with the capacity to produce more than 12 million tons (for both domestic use and exports), according to the U.S. Energy Information Administration. More than 75% of that capacity is in the South. Wisconsin’s current role is slight. It has six pellet plants with a total capacity of 250,000 tons or slightly more than two-tenths of one percent (0.2%) of the U.S. total as of Sept. 30, 2019, according to the EIA.

Seth Ginther, executive director of the United States Industrial Pellet Association, told the Yale University School of Forestry and Environmental Studies that wood pellets are a “low-cost, low-carbon alternative” to coal. He said that biomass is lower in “sulfur, nitrogen, ash, chlorine, and other chemicals than coal and traditional fossil fuels”.

Wood pellet producers often use waste wood, according to Ginther. He said that this economic use of waste wood helps to maintain working forests (rather than see the same land undergo commercial development).