Residential Wood Pellets Market is expected to grow at a CAGR of 6.32%
Renewable Energy Policies and Increasing Demand for Bioenergy are factors driving the Global Residential Wood Pellets Market in the forecast period 2025-2029.
According to TechSci Research report, “Residential Wood Pellets Market
- Global Industry Size, Share, Trends, Opportunity, and Forecast 2019-2029”,
the Global Residential Wood Pellets Market is expected to register robust
growth during the forecast period.
The primary drivers for the market include increasing demand
for Residential Wood Pellets in clean energy generation, especially in the
European region. However, the adoption and increasing deployment of alternative
renewable energy sources such as solar photovoltaic, wind energy, and
geothermal in various parts of the world is likely to hinder the market growth
during the forecast period. The heating application held a significant market
share in 2021, and it is likely to dominate the market during the forecast
period.
As per the World Bioenergy Association, Residential
Wood Pellets have the potential to replace coal in power generation facilities.
With technology development in recent years, Residential Wood Pellets have
undergone some thermal upgrading through various processes like torrefaction,
hydrothermal carbonization, and steam explosion. The thermal upgrading enables Residential
Wood Pellets to act as a fuel with coal properties. The Asia-Pacific region
with the highest number of coal power plants in the world is expected to be an
opportunity for the market to grow in the near future. With a significant
production of Residential Wood Pellets during 2021, Europe is expected to
dominate the market during the forecast period.
Browse over XX market data Figures
spread through XX Pages and an in-depth TOC on the "Global Residential Wood Pellets Market.”
Based on Application, The Heating segment emerged
as the dominating segment in 2023. Pellets are a solid biomass fuel, primarily
produced from wood residues and agricultural by-products like straw. Specific
advantages of pellets as compared to unprocessed biomass include standardized
properties, high energy content, and high density. Residential Wood Pellets for
heating applications are primarily used in residential and commercial sectors
for food, cooking and grilling, and supplying heat to homes. Since the cost of
pellets remained cheaper than that of other fuels for a long time, it has
become a more economical option, addressing the primary concern of the
residential and commercial sectors. In addition to this, in 2020, the wood
pellets, due to oversupply, experienced a sharp decline in their prices.
As a renewable energy source, Residential
Wood Pellets have received subsidies and incentives from the governments in
many countries, and many countries either launched or updated their policies
and schemes related to Residential Wood Pellets for heating applications in
recent years. For instance, in January 2021, a new Wood and Pellet Heater
Investment Tax Credit (ITC) came into effect in the United States, under which
consumers buying highly efficient wood, pellet stoves, or larger residential
biomass heating systems can claim a 26% tax credit that is uncapped and based
on the full cost (purchase and installation) of the unit.
On a similar note, from April 2021, the
United Kingdom amended its Domestic Renewable Heat Incentive (Domestic RHI) of
2014 to aim at promoting the use of renewable heat at residential levels.
Within the amendment, the Department for Business, Energy & Industrial
Strategy (BEIS) announced the relaxation of the requirement for accreditation
applications to be submitted within twelve months of the eligible heating
system's commissioning date. In addition, the participants whose heating system
was commissioned on or after March 1, 2019, became eligible to apply for the
Domestic RHI until the scheme closes to the new applications on March 31, 2022.
Therefore, owing to the above points, the heating application is expected to
dominate the wood pellet during the forecast period.
Based on Region, Europe is projected to
dominate the market throughout the forecast period. In Europe, the demand for Residential Wood
Pellets is expected to increase by 30-40% between 2021 and 2026. Europe
represents more than 50% of global pellet demand. As of 2020, European nations'
use of pellets includes residential heating (40%), power plants (36%), commercial
heating (14%), and combined heat and power plants (10%). Moreover, pellets have
also made their way into coal conversion projects in local authority or public
administration buildings such as schools and offices. As of 2020, most of the
co-firing power stations have either closed or converted since these early
projects, with several making a move to 100% Residential Wood Pellets for fuel.
The largest of these is Drax Power Station in North Yorkshire, which has
converted four of its six 65 MWe generating units to run exclusively on biomass
and is currently evaluating options for its remaining two coal-fired units.
As of 2020, sawmill residues make up 85%
of the mix for wood pellet production, followed by roundwood (13%) and
recovered wood (2%). Although the wood residues are likely to remain an
important feedstock, especially in northern and western Europe, they will not
be sufficient to meet the future fiber demand from the growing wood pellet
sector. Further, technological advancements in the market in the region are
also likely to increase the demand for Residential Wood Pellets during the
studied period.
Key market players in the Global Residential
Wood Pellets Market are: -
- Enviva LP
- Drax Group plc
- Graanul Invest AS
- Pinnacle Renewable Energy Group Inc.
- Energex American, Inc.
- German Pellets GmbH
- Westervelt Company
- Lignetics, Inc.
- TANAC S.A.
- Rentech, Inc
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“The global Residential Wood Pellets market
is propelled by several key drivers. Firstly, renewable energy policies
worldwide are fostering the adoption of Residential Wood Pellets as a
sustainable biomass fuel, aligning with global efforts to reduce carbon
emissions. The increasing demand for bioenergy, driven by environmental
awareness and a desire to transition away from fossil fuels, further amplifies
the market's growth. Government incentives, subsidies, and tax benefits
incentivize businesses and consumers to invest in wood pellet technologies.
Additionally, technological advancements in pelletization processes enhance
production efficiency. The market is also buoyed by consumer awareness of the
environmental benefits of Residential Wood Pellets and the global push for a
green energy transition, emphasizing the role of Residential Wood Pellets in
achieving renewable energy targets.” said Mr. Karan Chechi, Research Director
with TechSci Research, a research-based global management consulting firm.
“Residential Wood Pellets Market -
Global Industry Size, Share, Trends, Opportunity, and Forecast Segmented By
Feedstock (Forest Waste, Agricultural Waste, and Others), By Application
(Heating, Combined Heat & Power (CHP), and Power Generation), By Region, and By Competition 2019-2029” provides statistics & information on
market size, structure, and future market growth. The report intends to provide
cutting-edge market intelligence and help decision makers take sound investment
decisions. Besides the report also identifies and analyzes the emerging trends
along with essential drivers, challenges, and opportunities in Global Residential
Wood Pellets Market.
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