The perspectives of pellets and briquettes market

The rapid increase in price for natural gas and oil stimulated the strengthening of the position of biofuel in the fuel market. EU plan "20-20-20" established last year, is aimed to increase the share of alternative sources in the total energy balance of the participating countries.

The experts believe that in case of sustainable production of biofuel, Ukrainian exporters will be able to provide the necessary volume of biofuel to the European countries.
The leading position in the production of biofuel belongs to the companies of Polesie and Transcarpathia regions. Their advantage lies in the profitable location near raw material sources (companies for the production of rape and wood processing).

The forestry of Chernigov, Zhytomyr, Ivano-Frankovsk regions is making advantage as well.
The analysts note that the location of biofuel enterprises near large cities simplifies the purchasing and sales of the product, but human resources here are expensive. As a result, the cost of biofuel increases and it becomes less competitive.

The inhibiting factor in the production of biofuel is the need of large capital investment, which many companies do not have. The only solution at this point is to attract foreign investors.

Despite the fact that Ukrainian legislation already has laws that promote the development of biofuel segment, the market for biofuel remains a developing area.

Ukrainian producers are oriented to export, as in European countries consumers are willing to pay good price for biofuel. The main importers of pellets and briquettes are the consumers of Ukrainian production from Sweden, Belgium, Denmark, Germany, Holland, Austria, Italy, Slovakia and Poland.

In Ukraine, the consumption of biofuel product happens on the local level. Heating output from the combustion of wood pellets and from usage of gas is roughly the same, but biofuel is 200% cheaper.
The scientists discover new ways to generate energy. They even learned to produce biofuel recycling certain types of algae (e.g. Chlamydomonas). The market for biofuel has promising perspectives but how they will be implemented remains to be seen.