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The wood fuels market size is forecast to increase by USD 8.48 billion estimated to grow at a CAGR of 8.88% between 2024 and 2028. The Wood Pellets was the largest segment, valued at USD 7 billion and continues to grow. The reduced utilization of coal in the power sector, with the expanding global trade in wood-based fuels and escalating industrial uses is an upcoming trend in the Wood Fuel Industry.
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The declining use of coal in the power industry is an emerging trend shaping the market growth. Coal accounts for a significant portion of the power generated globally. However, coal power is gradually being replaced with relatively clean fuels and sources globally. Renewable resources are a competition to coal power, and since they are low or free from emissions, their popularity impacts the upcoming fossil fuel power projects. In September 2021, at the United Nations General Assembly, through a video link, Chinese President Xi Jinping announced that China would step up support for Green and low-carbon energies in developing countries without building any new coal or power plants overseas. Since the need for power will not reduce, the decline in coal power will lead to the use of alternate sources of energy, such as wood fuels, which will substitute coal to generate power and heat.
For instance, as of February 2023, India's established renewable power capacity (together with hydro) stood at 168.96 gigawatts (GW), representing 40.9% of the generally established energy capacity. Solar power contributed 64.38 GW, 42.02 GW from wind energy, 10.77 GW from biopower, and 51.79 GW from hydropower. Therefore, the decline in coal usage in the power industry to produce electricity is expected to positively affect the wood fuels market during the forecast period.
The wood pellets segment is estimated to witness significant growth during the forecast period. Wood pellets are a form of wood fuel used to generate electricity and heat. They are made from sawdust or other woody biomass with/without additives. They are generally available in a cylindrical form and of various lengths.
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Wood pellets are also used as fuel in thermal and gasification power production. The wood pellets segment is expected to grow significantly during the forecast period, driven by government ventures to promote renewable energy and the increasing adoption of wood pellets as a fuel source in various industries such as power. They are considered a clean and sustainable energy source, as they emit lower levels of greenhouse gases than fossil fuels. This has led to the adoption of wood pellets as a preferred fuel source. Thus, the demand for wood pellets is expected to rise during the forecast period, owing to growing awareness of renewable energy resources used in generating power and the high combustion of wood pellets, thereby driving the global wood fuels market during the forecast period.
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Europe is estimated to contribute 59% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. The leading countries for the consumption of wood pellets were the UK, Italy, Germany, Denmark, Sweden, France, and Belgium. The consumption of wood fuels is primarily due to strict policies implemented to increase the share of renewables in the final energy consumption and to mitigate the consequences of climate change. In Europe, most buildings have installed individual boilers and use fossil fuels and electricity to meet their heating needs, which is necessary for cold climates, thereby increasing greenhouse gas (GHG) emissions. However, the constant increase in electricity and oil prices led to customers seeking alternative sources of energy to meet their heating needs. Wood fuels such as wood pellets are among the fastest-growing biomass carriers. They are used by residential, commercial, and industrial end-users.
In addition, wood fuels are comparatively priced lower than the prices of heating oils, which makes them economical. As wood fuels are carbon neutral, they are environmentally friendly. Biomass is also made from local resources such as wood waste, thereby making them sustainable. It also reduces issues related to energy security, which in turn fuels the growth of the global wood fuels market during the forecast period.
Stringent regulations on carbon dioxide emissions are notably driving the market growth. Emissions from burning coal account for the largest share of CO2 emissions from human activity. Globally, government bodies are focusing on reducing GHG emissions. Amid international agreements such as the Kyoto Protocol, the foothold of coal-powered electricity generation in the global energy mix is uncertain. Agencies such as the Environmental Protection Agency (EPA), the Intergovernmental Panel on Climate Change, and the Climate Change Act of 2008 have targets to reduce GHG emissions.
However, these regulations encourage the use of alternatives such as bioenergy. Biomass is a carbon-neutral energy source, which makes it beneficial to create a low-pollution environment and contributes to the targets set by the governments. Such factors will drive the growth of the wood fuels market during the forecast period.
Installation requirement for biomass boiler and feedstock storage is a significant challenge hindering the market growth. Biomass boilers using wood are typically larger than regular boilers. As these boilers are placed on site, they require storage containers to store the fuel, such as wood chips, pellets, or logs. Storage of fuel is a challenge for industries that are close to urban areas due to constraints on space. The installation of boilers is subject to design, construction, operation, maintenance standards, and regulations set by governments, which vary across regions. Biomass boilers are relatively new in terms of usage when compared with conventional boilers. Therefore, installing biomass boilers will pose technological challenges in terms of design, emission control, and size of the boiler.
Moreover, power boilers pose several operational challenges related to rapid start-up capabilities and high operating efficiencies. Preventing tube failures is a priority, but complex failure paths, influenced by thermal transients, are difficult to understand and mitigate. Hence, these boilers will also require maintenance to address design issues to prevent risks. Thus, installation requirement for biomass boilers and feedstock storage is likely to halt the growth of the global wood fuels market during the forecast period.
The market research report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Wood Fuels Market Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Andritz AG - The company offers wood fuels such as Wood pellets which is recognized as a sustainable alternative to fossil fuels and will play an important role in helping utilities decarbonize the power grid.
The research report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The wood fuels market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2018 to 2028.
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Wood Fuels Market Scope |
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Report Coverage |
Details |
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Page number |
150 |
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Base year |
2023 |
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Historic period |
2018 - 2022 |
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Forecast period |
2024-2028 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 8.88% |
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Market growth 2024-2028 |
USD 8480.85 million |
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Market structure |
Fragmented |
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YoY growth 2023-2024(%) |
8.3 |
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Regional analysis |
Europe, North America, APAC, Middle East and Africa, and South America |
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Performing market contribution |
Europe at 59% |
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Key countries |
US, UK, Italy, Denmark, and Germany |
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Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
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Key companies profiled |
Andritz AG, AS Graanul Invest, BALT WOOD ENTERPRISE SIA, Biogra, BIOMAC sro, BMK Woods, Drax Group Plc, Energy Queensland Ltd, Enviva Inc., Fram Renewable Fuels, Granules LG, Norfolk Oak, Nugreen Energy Pvt. Ltd., Pfeifer Holding GmbH, Premium Pellet Ltd., VIRIDIS ENERGY INC., Well Seasoned Wood, and Wismar Pellets GmbH |
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Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID 19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period |
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Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Type
7 Market Segmentation by Application
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
Research Framework
Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key industry influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.
INFORMATION SOURCES
Primary sources
Secondary sources
DATA ANALYSIS
Data Synthesis
Data Validation
REPORT WRITING
Qualitative
Quantitative
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