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GSR 2015

42 02 MARKET AND INDUSTRY TRENDS Bio-heat Markets Solid, liquid, and gaseous biomass fuels can be combusted to provide higher-temperature heat (200–400 ˚C) for use by industry, in district heating schemes, in agricultural processes, and in combined heat and power (CHP) plants. They also can be combusted for use at lower-temperature heat (<100 ˚C) for drying; for heating water for domestic, commercial, or industrial use; and for heating space in individual buildings. Globally, biomass was used to produce an estimated 12,500 TWh (45 EJ) of heat in 2014, up from 12,360 TWh (44.5 EJ) in 2013 and accounting for nearly 77% of total global primary bioenergy demand.18 Roughly 70% (8,805 TWh) of this was generated from traditional biomass, which is used for heat primarily in Asia (5,305 TWh or 19.1 EJ) and Africa (3,222 TWh or 11.6 EJ).19 Modern biomass heat generation occurs mainly in Europe (861 TWh or 3.1 EJ), developing countries in Asia (750 TWh or 2.7 EJ), and North America (roughly 722 TWh or 2.6 EJ).20 Approximately 9 GWth of modern biomass heat capacity was added in 2014, increasing total global capacity to about 305 GWth.21 In 2014, Europe remained the world’s largest consumer of modern bio-heat, most of which was in Sweden, Finland, Germany, France, and Italy.22 A large portion of Europe’s bio- heat is produced for district heating networks, where the share of heat derived from bioenergy has grown steadily in recent years; as of 2014, this share reached an estimated 12–23%.23 Solid biomass heat consumption is rising sharply in countries that promote the use of wood fuel through policies such as France’s tax credit and the UK Renewable Heat Incentive (non- domestic).24 Heating with split roundwood remains common in residential heat markets. In addition, roughly 50% of total biogas consumption in Europe, amounting to more than 92 TWh, is attributed to heat production.25 Biogas also accounts for a significant amount of heat production in Asiai . In 2014, China had an estimated 100,000 large- scale modern biogas plants and 43 million residential-scale biodigesters (the fuel is used primarily for cooking).26 China produces significant amounts of heat from individual and farm- scale biogas plants, generating roughly 400 GWh per day.27 India installed more than 82,730 family biogas digesters in 2014, bringing its total to 4.75 million.28 In South Korea, roughly 24% (roughly 0.62 TWh) of biogas production was utilised to generate heat during the year.29 In the United States, most heat produced from biomass is used by the industrial sector (primarily the pulp and paper industry), which hosts 420 large-scale boilers and over 11,000 small-scale boilers.30 However, the residential sector drives US demand for pellets, which are burned in more than 800,000 individual pellet stoves.31 Heating with split roundwood is also common in US residential markets. In 2014, more than 2.71 million homes were heated primarily with wood, an increase of almost 4% over 2013.32 Bio-power Markets Bio-power capacity increased by an estimated 5 GW in 2014, bringing the global total to approximately 93 GW.33 Bio-power generation also increased, from an estimated 396 TWh in 2013 to about 433 TWh in 2014.34 By country, the leaders for bio- power generation were the United States (69.1 TWh), Germany (49.1 TWh), China (41.6 TWh), Brazil (32.9 TWh), and Japan (30.2 TWh).35 Although the United States continued to lead global bio- power generation and capacity, with 16.1 GW in operation at year’s end, only 0.3 GW was added in 2014 (down about 50% from 2013).36 Growth has slowed in recent years because of limited policy incentives for new installations.37 US bio-power is derived primarily from wood and agricultural residues burned in co-generation plants; as with bio-heat, most of this is consumed in the industrial sector, particularly by the pulp and paper industry.38 In 2014, electricity generation based on woody biomass increased 6% to 42 TWh, while generation based on waste biomass dropped 2% to 19.7 TWh.39 In 2014, China’s bio-power capacity increased by 1.5 GW to 10 GW. Most of the total (about 53%) was from agricultural and forestry products, and from municipal solid waste (about 45%).40 China is one of Asia's major consumers of wood pellets and chips.41 Elsewhere in the region, Japan added more than 0.9 GW of new solid biomass capacity (mostly MSWii ) and 6 MW of new biogas capacity, for an estimated total of 4.7 GW.42 India added only 0.5 GW in 2014 for a year-end total of 5 GW of capacity. The market was down relative to 2012 and 2013 due in part to uncertainty about feedstock supplies.43 While India leads the region for consumption of wood pellets and chips for bio-power production, most of India’s bio-power is produced from bagasse and other agricultural waste.44 In South Korea, roughly 59% of biogas produced annually is used to generate about 1.5 TWh per year of electricity.45 By region, Europe leads for both bio-power generation and capacity, with roughly 36.5 GW in operation at the end of 2014.46 Countries that added capacity during 2014 include the United Kingdom, which increased its capacity by 0.5 GW thanks largely to the partial conversion of the second 0.66 GW unit (out of a total of six) of the coal-fired Drax Power plant to solid biomass, and Germany, which installed 0.4 GW of new capacity, most of which relies on biogas and biomethane.47 Total EU electricity generation from solid biomass was approxi- mately 81.6 TWh in 2014.48 The EU’s top five producers combined—Germany, Finland, the United Kingdom, Sweden, and Poland—made up about 63% of the region’s bio-power production.49 Although a number of countries use biomass primarily in electricity-only plants (e.g., the United Kingdom, Ireland, and Hungary), about 65% of the EU’s bio-power was generated in CHP plants, up from 63% in 2013.50 In addition, roughly 50% of the total biogas produced in Europe during 2014 (92.3 TWh) was used to generate electricity.51 More than 14,560 biogas power plants were operating in Europe, with total capacity approaching 7.9 GW.52 Germany accounted for i - Most available information on bioenergy in Asia is limited to biogas. ii - Municipal solid waste. The GSR strives to report only the renewable portion of MSW. However, oftentimes MSW information reported in the literature includes both renewable and non-renewable values.

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