16 September 2010

In 2009, the European Union – the Commision, the Parliament and the council - decided upon a new energy and climate policy. This policy was summarized under the heading 20 :20:20, meaning that until the year 2020
- the C0² emissions should be reduced by 20% as compared to 1990
- the energy efficiency should be increased by 20% as compared to a business as usual scenario
- the share of renewable energy sources (RES) such as biomass, hydro, wind, solar should be increased in the energy mix from 8,5% in 2005 to 20% in 2020.


The European energy policy on Renewables

The main arguments for the introduction of this policy were the concerns about global warming, the upcoming scarcity of fossil fuels and the chance to create new jobs and develope technolocial leadership in the rapidly growing area of renewable energy.
The RES policy follows a distinct time table:

April 2009: decision by the European council
June 2009: presentation of a template for renewable national energy action plans (RNEAP)
June 2010: submission of the 27 NREAPs to the Commission
2011 – 2020: implementation period
every two years: comprehensive report to European Commission

The Directive on Renewables (2009/28/EC) is the legal basis for this new policy. In this directive mandatory national targets for the share of Renewables in 2020 are defined. They differ widely among countries in accordance with their historical performance and econonic


capabilites as the following example shows:

Country share of RES in 2005 Mandatory share of RES in 2020


share of RES in 2005
Mandatory share of RES in 2020
United kingdom

Source: Dir 2009(28/EC)

Renewable National Energy Action Plans (RNEAP)

An important instrument for this policy is the RNEAP. Member States have to declare in these plans in detail how they are going to reach their targets, what share of Renewables they plan to achieve in the heating&coling sector, in the electricity sector and in transportation. For transportation fuels an obligatory minimum target of 10% has to be reached by all member states.

In order to get comparable data the Commission published in 2009 a template for these plans. Based on this template the Member States had to submit their RNEAPs in June 2010 to the European Commission.

Until the beginnng of September 2010 16 member states, representing 80% of the population of the EU, submitted their plans to the Commission in their national language. Now these plans are analysed. The following data are based on these plans and have therefore to be seen as preliminary, because

* They refer only to those16 member states that submitted their plans until September
* The data so far are not always consistent and might be adjusted in the future procedure
* Therefore they give only a first overview about future markets
In all calculations using the differentdata the following equation was used:
1 Mtoe = 11,63 TWh = 41,686 PJ = 5,8 Mio m³ wood

Te main results of these plans:

Electricity: the 16 member states plan to increase the production of electricity from wood in the period from 2020 to 2020 by 62 TWh.
Heat: the heat production based on solid biomass in the same period shall be increased by 232 TWh.

The most ambitious targets for electricity and heat from solid biomass are put forward in the UK, France, Italy, Sweden but also Finland, Germany, Spain and the Netherlands have important targets.The supply with indigenous wood is not sufficient especially in countries with a small forest endowment such as UK, Netherlands, Denmark.
But also countries with a large forest area and an already highly developed bioenergy sector are open to imports such as Sweden.


The European pellets markets
In the EU 27, the market for pellets grew steadily over the last years. For 2009, it can be estimated, that the production of pellets reached about 6,9 Mt, the consumption 9,1Mt. The difference was imported, mainly from North America, (1 Million alone from Canada) and from Russia. The main importing countries were BE, NL, DK and the UK.

The European pellets market is divided in 3 segments
- residential users buying pellets in bags (Ital) or loose for boilers (Germany, Austria). This market grows rather slowly at present,because its growth depends strongly on government policies and/or high oil prices. The clients only buy high quality pellets.
- Companies in the production or service sector, district heating plants. This sector grows rather fast, pellets are replacing heating oil.
- Power plants using pellets for co-firing. More than 50% of the total quantity of pellets in Europe is consumed by power plants. They use huge quantities, up to several 100.000 tons per plant. Using pellets they avoid buying C0² certificates. According to the plans this market shouldgrow rapidly.

The European energy policy and the pellets market


Forced by the new European energy policy all member states have to increase their share of Renewables. An analysis of the submittel plans shows for example, that the 4 countries NL,UK,DK,SW (the plan of BE is not yet published) intend to increase their electricity production based on wood by 31 TWh. On pellets basis this would require around 19 Mt pellets. Therefore, a strong market growth for indutry pellets in the future can be expected, notably along the northeast coast of Europe.

Heat from wood comes from 4 sources:
- firewood, important in rural areas of Europe
- wood chips, wood residuals used in individual boilers or for district heating
- derived heat as by-product of the power generation in CHP plants, used in district heating or industry
- from pellets

The future share of pellets in the heating sector is hard to estimate.
For the UK a demand of 7,4 Mt for 2020 has been published recently. It will depend strongly on the government policies in which way the targets for renewable heat will be reached. The pellets for this market will mainly be produced by regional or local pellets producers using the advantage of low cost of transport.

Other issues in relation to the new energy policy
In connection with this presented policy new issues will appear influencing the pellets industry.
The sustainable production of wood in the sense that not more wood is used than is produced in a region annually will become more and more important. A certification scheme to prove the sustainable production of wood is under discussion. Sustainability in the forest management is also an important requirement to assess wood as carbon neutral energy source also in the future.
For the certification of the pellets chain - raw material, production, storage, transport, delivery to the final consumer - a new certification system EN plus A1, A2 is being introduced in Europe. At the beginning mainly for high quality pellets.

Torrefaction, as a new technology, to adjust biomass and also pellets better to the needs of co-firing coal plants, starts the first industrial testing in pilot plants, that will be built within the next 2 years. It is still to early to asses the importance of this technology in the future.

• The new European energy policy will increase the demand for pellets and also create new requirements concerning sustainability and quality
• The presented figures and conclusions are preliminary as 11 REAPs are still missing, and the measures to reach these targets are not yet implemented.
• It will strongly depend on the political measures, that should be implemented within the next 2 years, to reach the mentioned targets - an open question!
• So far, Markets look highly attractive in UK, IT, NL, DK, DE. BE.
• Further analysis : AEBIOM, Cross Border Bioenergy project

Further information: RES Directive (2000/28/EC), www.pelletsatlas.info; transparency platform, europe, energy on RNEAP; Proceedings forest bioenergy, Tampere 2010; procedings Industrieforum pellets, Stuttgart, 2010.

Theses for the 12th St. Petersburg International Forestry Forum
20 October 2010, St. Petersburg, Russia

Register to the conference here: click


Dr. Heinz Kopetz, AEBIOM European Biomass Association,