British authorities have come under pressure due to the increase in the number of people seeking biomass energy. As a result, 9.641 million metric tons of wood pellets are planned to be imported by the UK, thus surpassing all previous records.
2024 is expected to be a landmark year in terms of biomass energy in the UK as the target for imports has increased drastically in comparison with previous years. The increased demand for recognition in renewable energy sources and the reduction in pricing for wood pellets are the determining factors in achieving this milestone.
If reports from USDA Foreign Agricultural Service are anything to go by, UK will be importing 9.641 million metric tons of wood pellets in 2024. This is a drastic improvement when considering 2022 data which had seen a mere 7.516 million tons imported, followed by an even lower 6.364 million tons in the year of 2023. Increasing consumption in the power energy sector along with decreasing prices of the global pellet market have contributed towards this rise.
Industrial energy consumption stands at 93% of the total demand expected for 2024. This volume of demand will be catered using industrial biomass energy plants located in Lynemouth and Selby. The remaining seven percent is split between commercial and residential usage but given how the Domestic Renewable Heat Incentive has led to an environment with lowered residential demand, sectorailing is likely to persist.
In the year 2023, the UK relied on the United States for wood pellets since they were able to provide more than half of the wood pellets, exactly 73%. Other suppliers including Estonia, Latvia, the Netherlands, Canada, and Brazil. Russia used to provide wood pellets until the UK banned them due to sanctions which started in 2022 when a 35% tariff was placed on Russia.
Becoming a supplier for the Uk after Brexit has its several implications. However, in the case of the UK, the alternative wood pellets regulatory regime is somehow still nearly compliant with the EU measures. It is worth mentioning that all these raw materials have to meet sustainability requirements, this includes, for instance, certification under recognized schemes such as FSCTM or PEFC. This is to ensure that they comply with certain standards that allow them to be eligible for some of the government support programs such as the case in the biomass energy sector with ROCs.
UK’s total wood pellet consumption in 2024 is expected to go beyond the total consumption of 2021 which was 9.545 million tons to an estimated 9.848 million tons according to different forecasts. What is even clearer is the UK’s EU commitment of achieving net zero greenhouse gas emissions by 2050. As opposed to the UK wanting to achieve net zero emissions by 2050, the incoming Labour government appears to sit at the other end of the seesaw as they are looking to shift focus from biomass to wind and solar energy.
Indeed, as experts of top market platforms like USDA FAS highlight, wood pellets remain as a key element of the UK’s renewable energy strategy and the country’s target climate ambitions.
