
This story here, my latest on the issue of global forest biomass for energy, sends a bit of a mixed message. Projected supply and demand for wood pellets appears to be rising dramatically through 2030, with more wood coming from tropical forests than every before.
On the other hand, there appear to be a few cracks forming in the long-term viability of an industry that has been on a steady, upward trajectory for 15 years or more — save for Enviva’s self-inflicted business wounds that led to its 2024 bankruptcy. Subsidies are being inched back on South Korea and Japan. Drax is still getting a ton of British subsidies for five more years, but far less than the previous 10. Germany’s second-largest city, Hamburg, nixed a conversion of a coal-burning plant to wood, admitting that it was not a climate friendly move. And a highly regarded investment think tank is raising a bright red flag to investors to think twice before investing in wood-pellet manufacturing stocks.
A source and forest advocate in South Korea went as far as to tell me he believes we are beginning to see that beginning of a paradigm shift regarding forest biomass for energy. The scientific arguments and journalistic reporting, including my own, that challenge industry line that it a climate-friendly alternative to coal, grow stronger every year. Is the tide really turning?
Meanwhile, in the near-term, the industry continues to grow, and native forests across the US Southeast, British Columbia, Eastern Europe and Southeast Asia, will continue to be diminished and degraded, many replaced by tree farms, to feed immediate demand.
