Over 1,200 New Biomass Incinerators to be Constructed Within the Next 10 Years?

- Decem­ber 4, 2014, AltEner­gy­Mag

Elec­tric­i­ty gen­er­a­tion from sol­id bio­mass con­tin­ues to increase through­out the world. In late 2013, around 2,800 oper­a­tional pow­er plants world­wide were incin­er­at­ing bio­mass only or very large shares of this fuel. These plants had an elec­tric­i­ty gen­er­a­tion capac­i­ty of about 42 GWel. Addi­tion­al­ly, around 350 fos­sil pow­er plants were co-incin­er­at­ing bio­mass. In 10 years, there will be approx­i­mate­ly 4,100 active plants with a capac­i­ty of around 67 GWel. In 2014 alone, approx­i­mate­ly 170 new pow­er plants with elec­tric­i­ty gen­er­a­tion capac­i­ties of around 3.6 GWel will be constructed.

The sub­sidi­s­a­tion of renew­able ener­gies will remain the most impor­tant mar­ket fac­tor for the devel­op­ment of elec­tric­i­ty gen­er­a­tion from bio­mass. Until ear­ly 2014, around 140 coun­tries had intro­duced poli­cies for such a sub­sidi­s­a­tion. Most of them also had schemes for elec­tric­i­ty gen­er­a­tion from sol­id bio­mass at that time. Viet­nam, for instance, intro­duced a feed-in tar­iff for bio­mass elec­tric­i­ty some months ago. Around 40 coun­tries through­out the world have such com­pen­sa­tions. Oth­er coun­tries have dif­fer­ent sup­port schemes. Colum­bia, for instance, has recent­ly reduced the turnover tax on bio­mass elec­tric­i­ty and Mex­i­co has facil­i­tat­ed the access to the grid for this type of electricity.

Europe will remain the largest mar­ket for elec­tric­i­ty gen­er­a­tion from sol­id bio­mass in the 10 years to come. In late 2013, Europe had around 1,200 active bio­mass pow­er plants. This num­ber will increase to approx­i­mate­ly 1,750 by late 2023. The Euro­pean mar­ket, how­ev­er, is very frag­ment­ed and pre­con­di­tions for invest­ments dif­fer sig­nif­i­cant­ly in the indi­vid­ual coun­tries. Where­as more plants than ever are being built in Great Britain and France, Spain, Latvia and the Czech Repub­lic have reduced or even stopped their sub­sidi­s­a­tion sys­tems. Ger­many still grants, by inter­na­tion­al com­par­i­son, high sub­si­dies. The sys­tem, how­ev­er, has lost most of its incen­tive effects as all favourable loca­tions have been devel­oped for years.

When con­sid­er­ing the whole world, Chi­na, India, Brazil and the USA are the most impor­tant mar­kets at present. Asia and South Amer­i­ca cur­rent­ly have the most dynam­ic mar­kets for bio­mass pow­er plants. These regions have many yet unde­vel­oped favourable loca­tions, e.g. in the sug­ar, rice and wood indus­tries. Low sub­si­dies are enough to sig­nif­i­cant­ly increase the num­ber of projects in coun­tries such as Indone­sia or the Philip­pines, even though they will not realise all their devel­op­ment plans in the years to come.

The mar­ket for elec­tric­i­ty gen­er­a­tion from bio­mass is organ­ised region­al­ly in many cas­es. Indus­tries hav­ing a strong affin­i­ty for bio­mass (such as the paper or sug­ar indus­tries) remain the most impor­tant clients, with the ener­gy indus­try rank­ing second.

Many plant man­u­fac­tur­ers also have a region­al focus and there are only few glob­al play­ers. The region­al strengths and weak­ness­es of the indi­vid­ual tech­nol­o­gy providers often reflect the respec­tive design of the sub­sidi­s­a­tion schemes, for instance when it comes to plant sizes or fuels. Brazil, for exam­ple, has providers focus­ing on incin­er­at­ing sug­ar cane. The sup­port of small-scale plants in Aus­tria has result­ed in a larg­er num­ber of plant man­u­fac­tur­ers in this segment.

At present, the inter­na­tion­al­is­ing demand also leads to glob­alised com­pe­ti­tion. In light of a grow­ing num­ber of sat­u­rat­ed mar­kets on their own con­ti­nent, pres­sure to inter­na­tion­alise busi­ness is espe­cial­ly strong for the Euro­pean plant man­u­fac­tur­ers, which have the largest share of the world mar­ket. More and more Chi­nese sup­pli­ers surge onto for­eign mar­kets as well.

Our study “Bio­mass to Pow­er” is the most exten­sive of its kind, as it is the only analy­sis based on eval­u­at­ing the plants exist­ing through­out the world, and not only on pub­lic sta­tis­tics. You will find fur­ther infor­ma­tion on the fifth edi­tion at: www.ecoprog.com

As a respect­ed strat­e­gy con­sul­tan­cy, eco­prog accom­pa­nies clients from Ger­many and abroad in deal­ing with imple­men­ta­tion-ori­ent­ed man­age­ment issues with polit­i­cal, tech­ni­cal or eco­nom­ic back­grounds in the envi­ron­men­tal and ener­gy tech­nol­o­gy seg­ments. We focus on strat­e­gy con­sult­ing, mar­ket and com­pe­ti­tion analy­ses as well as mul­ti-client studies.