Bioenergy Market

In 2022, the global bioenergy market reached a valuation of USD 344.90 billion, with projections indicating a climb to USD 642.71 billion by 2030. This growth represents a compound annual growth rate (CAGR) of 8.0% for the period between 2023 and 2030. Within the market, the solid biomass category accounted for 56.6% of the total share in 2019. Specifically, the Asia-Pacific bioenergy sector was valued at USD 96.76 billion in 2022.

Bioenergy, derived from natural and biological sources, stands as a renewable energy option. Prior to the COVID-19 pandemic, market expansion was propelled by environmental concerns and heightened energy needs. Furthermore, the cost-effectiveness of bioenergy also stands as a significant driver behind its global market expansion.

Covid-19 Pandemic Affects Heavily On Bioenergy Projects

Presently, due to the influence of the Covid-19 pandemic, restrictions encompassing travel, labor, and industry are anticipated to result in a significant reduction of billions of barrels of oil and trillions of cubic meters of gas within the global energy landscape solely in the year 2020. The U.S. Energy Information Administration (EIA) currently projects a decline in biomass utilization for electricity generation, estimating it to reach 27.3 billion kilowatt-hours (kWh) for the current year, down from the 28.8 billion kWh recorded in 2019.

The repercussions of the COVID-19 pandemic are also poised to exert substantial effects on electricity consumption patterns in the United States. As outlined in the EIA's Short-Term Energy Outlook report, it is predicted that electricity sales within the commercial sector will observe a decline of 6.5% in 2020, given the closure of numerous businesses and the prevalence of remote work. Concurrently, retail electricity sales in the industrial domain are also projected to decrease by 6.5% this year, a consequence of reduced production across multiple factories.

Latest Trends

The number of nations endorsing the Paris Climate Change Agreement has witnessed a substantial rise. This accord mandates countries to amplify the integration of renewable energy sources within their overall power generation frameworks. The adoption of biofuels and biogas has garnered considerable global attention as an inventive approach to address climate change, mitigate greenhouse gas (GHG) emissions—particularly the reduction of CO2 emissions—and fulfill commitments under the Kyoto Protocol. While fossil fuel emissions constitute the primary contributor to global warming in the energy sector, biofuels and biogas, depending on their origin and conditions, emit significantly fewer greenhouse gases. This principle also holds true for other avenues of biomass application, including heat production and electricity generation through primary biomass. Additional merits of employing biofuels encompass enhancements in local air quality, waste reduction, and, under suitable circumstances, safeguarding ecosystems and soil integrity.

The management of waste stands as a critical worldwide challenge, with billions of tons of waste originating from agriculture, municipal activities, and industries annually. Biofuels, biogas, and biomethane systems are transforming waste management into an economic opportunity for agricultural operations, dairies, food processing, and wastewater treatment sectors. Biogas emerges during anaerobic digestion and can be refined into biomethane. Biofuel, alternatively, is derived from plant, algal, or animal biomass, serving as a potent renewable fuel that can substitute fossil fuels. The utilization of biogas-fueled gas engines not only enhances waste management but also maximizes energy production.

The United States alone generates 17 million tons of waste annually, encompassing both edible and inedible refuse. Similarly, the United Kingdom produces approximately 90 million tons of manure and slurry each year. The abundant availability of feedstock for bioenergy production is poised to drive market growth over the forecast period.

Driving Factors

The surge in global environmental protection regulations is prompting the power generation sector to embrace cleaner and more eco-friendly energy sources. Leading economies across the world are dedicating efforts to amplify their renewable energy capacities in a bid to diminish reliance on conventional fossil fuel-based power generation. Investment records in the renewable sector demonstrate a decline in global reliance on coal and other fossil fuels due to heightened investments in energy alternatives such as solar, wind, and geothermal power. These forms of energy represent a significant portion of the world's renewable energy consumption, accounting for approximately 50% and addressing a range of global challenges, including the scarcity of fossil fuels and associated environmental concerns. Distinguished by its versatility across electricity, heat, and transportation, it stands as the sole renewable energy adaptable across all three sectors. Consequently, numerous countries are actively contemplating investments in these energy avenues, consequently propelling the global market forward throughout the projected timeframe.

Biofuels serve as noteworthy substitutes for petroleum-based fuels in the transport sector, forming a pivotal component of strategies aimed at enhancing fuel security, mitigating climate change, and fostering infrastructure development. To fulfill emission targets set by diverse governments to combat global warming and enhance energy supply security, an escalated contribution from both traditional and advanced biofuels will be requisite over the forecast period. Conversely, aviation stands as the second-largest energy consumer within the transportation realm. A significant challenge in aviation pertains to the need for exceptionally pure and chemically stable fuel. Nonetheless, a range of European companies have initiated the production of jet fuel from Jatropha and are poised to supply major airlines in the near future. Moreover, collaborative efforts between airlines and the U.S. military have demonstrated the feasibility and safety of blending petroleum-based and bio-jet fuels for practical usage. Liquid biofuels hold potential applications in other areas as well, such as in rail transport, although their feasibility in this sector remains uncertain for the forthcoming years. Given that diesel traction constitutes a substantial portion of railway operations, biodiesel emerges as a promising alternative fuel for train propulsion. Additional biofuels of secondary importance encompass Hydro-Thermal Upgrading (HTU) diesel, Biomass to Liquid (BtL), biogas, biomethane, bioethanol, and biomass for electricity generation in alternative systems.

Restraining Factors

The initial capital outlay for setting up biofuel facilities carries a substantial cost. A number of nations offer financial support to initiate the construction of these plants. Yet, beyond construction, additional financial aid is imperative for the progressive evolution and enlargement of such facilities. The procedure of acquiring and stockpiling feedstock is a time-intensive and expensive undertaking. Regulations and financial backing are necessary to oversee the complete lifecycle of feedstock, encompassing its collection, sorting, processing, as well as the supply and distribution phases. This also extends to the establishment and operation of the plants themselves, as well as the subsequent sale and distribution of biogas and biomethane. To make the endeavor economically viable, it is essential for the plant's output to be both substantial and consistent, effectively covering both the initial investment and ongoing operational expenditures.

Regional Insights

From a geographical perspective, the global market has been assessed within five pivotal regions: North America, Europe, Asia Pacific, the Middle East & Africa, and South America. Forecasts indicate that Asia Pacific is poised to lead the market during the projected period. Developing economies such as India and China are enacting stringent regulations to curtail their carbon footprint, a decisive driver for market expansion. Notably, Japan has been observing an expansion in wood-based energy utilization, with significant forest cover facilitating the growth of wood stocks. In 2018, around 9 million metric tons of solid wood biomass were employed for heat and power, predominantly in chip form. Within Asia Pacific, China, India, Australia, South Korea, and Southeast Asian countries are substantial consumers of this energy variety.

Bioenergy is projected to contribute nearly half of the EU's 20% renewable energy generation target by 2022. In conjunction, the 2009 EU Renewable Energy Directive has set a goal for the U.K. to achieve 15% of its total energy consumption from renewable sources by 2020. Within Europe, pivotal countries like Germany, the U.K, France, Spain, Italy, and Sweden significantly employ bio-based energy sources. Currently, Europe is facing a significant challenge with a high number of COVID-19 cases and widespread lockdowns, potentially leading to a market contraction in 2020 compared to 2019.

North America has demonstrated prominence in the liquid biofuels sector in recent years, accounting for about 45% of global liquid biofuel production. Leading contributors to bioenergy within North America include the United States, Canada, and Mexico. The U.S. holds the position of the world's largest ethanol producer, manufacturing approximately 16 billion gallons (approximately 60 billion liters) in 2018. Additionally, the U.S. boasts a substantial number of biogas production facilities.

The Middle East & Africa ranks as the second-largest region in the global market. This region presents a staggering 45% of the world's renewable energy potential across various sources, amounting to more than triple the global electricity demand. Despite this, the region's biomass energy resources remain largely untapped. Key participants within this region encompass nations like Nigeria and the Gulf Cooperation Council (GCC) countries. In Latin America, Brazil and Argentina emerge as central players in the liquid biofuels segment, jointly contributing around 90% of liquid biofuel production in the region.

List of Key Companies Profiled:

• ADM (U.S.)
• POET (U.S.)
• Ameresco, Inc. (U.S.)
• Enerkem (Canada)
• MVV Energie AG (Germany)
• Enviva (U.S.)
• EnviTec Biogas AG (Germany)
• Green Plains Inc. (U.S.)
• Pacific BioEnergy Corp (Canada)
• Lignetics (U.S.)
• Drax Group (U.S.)
• Enexor Energy (U.S.)

Key Industry Developments:

• April 2020 – Finnish-Swiss biotech company Ductor is building three combined biofertilizer-biogas facilities in northern Poland. The new facilities will be built in Poland's Zachodniopomorskie region, located off the coast of the Baltic Sea. Two of the new plants would have installed capacity of 0.5MW, and the third will be 1MW. All three plants are expected to be operational in 2021.
• February 2020 – The U.S. based Brightmark Energy company announced plans to expand its waste-to-biogas project, partnering with six total farms in the region. The ‘Yellowjacket’ project would extract methane from 265,000 gallons of dairy manure per day and convert it into renewable natural gas (RNG) and other useful by-products.

Bioenergy Market Segmentation:

By Type

• Solid Biomass
• Liquid Biofuel
• Biogas
• Others

By Feedstock

• Agricultural Waste
• Wood and woody Biomass
• Solid Waste
• Others

By Application

• Power Generation
• Heat Generation
• Transportation
• Others

By Region

• North America: (U.S., Canada)
• Europe: (UK, Germany, France, Italy, Sweden, Spain, and Rest of Europe)
• Asia Pacific: (China, India, Japan, Australia, South Korea, Southeast Asia, and Rest of Asia Pacific)
• The Middle East & Africa: (Nigeria, GCC, and Rest of the Middle East & Africa)
• Latin America: (Brazil, Argentina, and Rest of Latin America)