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The global biomass power market size was valued at USD 51.2 billion in 2020 and is expected to grow at a compound annual growth rate (CAGR) of 5.9% from 2020 to 2028. Favourable government regulations encouraging thermal power stations to switch from coal to cleaner fuels, such as biomass, are expected to play a vital role in the market growth over the forecast period. Biomass generates bioenergy that is used across several end-use markets to minimize dependence on fossil fuels, reduce Greenhouse Gas (GHG) emissions, and improve the security of energy supply. Moreover, the decline in coal usage along with the growing use of wood biomass for distributed electricity production is anticipated to positively influence the industry landscape.
The U.S. market is projected to witness a substantial growth owing to rising implementation of climate change laws requiring usage of renewable sources for power generation purposes. Biomass fuels are used as a primary energy source in the U.S. and are majorly sourced from wood-derived biomass and municipal waste biomass
In addition, new developments aimed at using more biomass for fuel are set to boost regional market growth. Biomass serves as a sustainable and low-carbon alternative to conventional fossil fuels while allowing local groups to use domestically available biomass sources. It makes efficient utilization of crop residues, the unused portions of urban waste, and wood manufacturing wastes. The government organizations are emphasizing on utilizing biomass for electricity production as a part of energy security and energy efficiency strategy. Such initiatives aim to augment the share of clean renewables in the overall energy mix of national economies.
Bioenergy is the energy produced through the burning of biomass or biomass fuels. According to the International Energy Agency (IEA), bioenergy power production rose by 5% in 2019 that is only a percent less than the 6% yearly rate required to meet the 2030 Sustainable Development Scenario goals. Market developments and recent policy changes in emerging nations are expected to further provide a positive outlook to the market growth.
In 2020, the combustion segment occupied the largest revenue share of more than 80% and will retain the dominant position during the forecast years. Direct biomass combustion technology has relatively non-complex operations, higher reliability, and lower cost when compared to other advanced biomass power technologies. However, the segment may witness a decline with other efficient technologies taking over the market share.
The gasification segment is anticipated to attain the fastest growth rate over the forecast period owing to the high operational efficiency of the process. The process converts solid biomass into gaseous fuels that are further used to generate electricity with the remaining gas used as synthesis gas in chemical industries. Gasification technology is gaining traction owing to its ability to significantly reduce carbon emissions while producing a high calorific gas from a renewable source.
Anaerobic digestion plants serve as stand-alone energy plants near large volumes of forest or agricultural residue. Biogas production via anaerobic digestion is implemented at the household scale, village, and commercial scales in emerging economies of Asia Pacific, such as China and India. The process offers efficient management of abundantly available animal dung along with gas production for power generation, lighting, or cooking purposes.
The solid biofuel segment accounted for the largest revenue share of 79.1% in 2020. Solid biomass, such as crop waste, sawdust, and wood, are either used directly or processed into charcoal and briquettes for power generation, cooking, and heating purposes. However, burning solid biomass leads to an aggravation of severe climate change issues, which may hamper the segment growth over the forecast period.
Liquid biofuels include ethanol produced from grain and biodiesel produced from trans esterified vegetable oils blended with diesel. Biofuel serves as an alternative to internal combustion engines powered on kerosene, diesel, or gasoline, including usage in airplanes, ships, trucks, and passenger vehicles. Moreover, advanced liquid biofuels can provide an 80% emission reduction in aviation, heavy freight, and shipping. Technology commercialization is expected to boost the growth of advanced biofuels over the forecast period.
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