September 01, 2022 12:40 ET | Source: Straits Research Straits Research

New York, United States, Sept. 01, 2022 (GLOBE NEWSWIRE) -- Pellet fuels, also known as pellets, are biofuels made from compressed organic compounds or biomass. The production of wood pellets can utilize sawdust, logging debris, and even whole logs. The sawdust is compressed under high pressure or extruded through a die after being dried. On the market, Wood Pellets are available in various sizes to meet the needs of the residential, commercial, and industrial sectors, in that order. Wood pellets are an environmentally friendly fuel alternative to fossil fuels. To create wood pellets, manufacturers first remove moisture from incoming wood fiber, grind the fiber into a powder, and compress the powder into small, cylindrical pellets.

Over the forecast period, the wood pallet market is expected to be driven by the growing demand for wood pellets to produce clean energy. On the other hand, intense competition from alternative cleaner fuels and the end of government support programs for wood pellets will likely impede the market expansion of wood pellets. In addition, emerging applications and technological advancements, such as producing wood pellets from food residues (bio-bean, dry waste), torrefaction (supercharging biomass pellets), etc., are anticipated to offer tremendous opportunities for the wood pellet market in the coming years.

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The Incrementing Demand for Wood Pellets in the Production of Clean Energy to Drive the Global Wood Pellet Market

Energy security and climate change mitigation are significant market drivers for wood pellets in Germany, Indonesia, Thailand, and other countries. Government policies and an emphasis on renewable energy have been essential to these countries' growth of wood pellets. Global electricity systems are transitioning to renewable energy sources and reducing emissions. Intermittent sources, such as solar and wind, are the fastest-growing types of renewables being installed globally; furthermore, the dependability and versatility of wood pellets, as well as their ability to remove CO2 from the atmosphere while generating renewable electricity through a process known as bioenergy with carbon capture and storage (BECCS), make it an increasingly vital source of renewable energy. Thus, increasing market demand. In addition, biomass power plants generate baseload power, which cannot be achieved with solar or wind energy. In various regions, more than 80% of the world's electricity is also generated from fossil fuels, primarily coal.

In tandem with the technological development of the wood pellet market, coal-fired power plants are being converted to use wood pellets to generate electricity. If the goal is to reduce carbon dioxide emissions in the power industry, modifying existing coal-fired power stations to run on industrial wood pellets results in a significantly more significant CO2 reduction at a lower net monetary cost per metric ton avoided than other renewable technologies. And this increases the use of wood pellets to produce clean energy. Moreover, the current trend of retiring coal-fired power plants and constructing new high-efficiency natural gas-fired plants is rational if operating cost minimization is the only decision metric and reducing carbon emissions provides no benefit. Therefore, countries such as the United Kingdom, the United States, and others are adopting the technology and substituting wood pellets for coal in power generation, which is expected to drive the global wood pellet market during the forecast period.

Growing Oil Price Increasing the Use of Wood Pellets to Create Global Wood Pellet Market Opportunities Due to rising oil prices and the increased use of wood pellets for heating federal and municipal buildings, office buildings, and educational institutions, end-users enjoy lucrative growth opportunities. In addition, the governments of numerous nations provide financial incentives and subsidies to encourage the use of renewable energy sources for electricity generation. This, in turn, positively affects the global sales of wood pallets.

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Europe will likely command the market with the largest share during the forecast period. Diverse market factors, such as rising consumption of the product in power generation and incentives offered by European Union (EU) member states, are anticipated to significantly contribute to an increase in wood pellets demand over the forecast period. Along with the increasing replacement of traditional burners to improve automatic feed-in and comfort, the regional price competitiveness of wood pellets in Europe compared to propane and residential heating oil is one of the primary factors driving demand for wood pellets in Europe.

In the years ahead, it is presumed that the popularity of wood pellets will increase in Europe by 30% to 40%. And despite the likelihood that wood residues will continue to play a significant role as a feedstock, especially in northern and western Europe, it is unlikely that these residues will be sufficient to meet the growing demand for fiber in the wood pellet industry. In addition, technological advances in the region's market will likely increase demand for wood pellets over the forecast period. Due to the increasing number of power plants in the European area, it is anticipated that the demand for wood pellets to be used as fuel in power plants to generate electricity will increase significantly over the next few years.

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Competitive Players in the Market

Global Wood Pellet Market: Segmentation

Table of Content and Figure https://straitsresearch.com/report/wood-pellet-market/toc

Global Iron Ore Pellets Market to Grow at an Impeccable Growth Rate of 5%

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