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Study Finds Increasing Wood Pellet Demand Boosts Forest Growth, Reduces Greenhouse Gas Emissions, Creates Jobs

Posted by Robert Johansson, USDA Acting Chief Economist in Energy Conservation
Feb 21, 2017
A truck is filled with wood chips.
A truck is filled with wood chips as part of the process of turning wood into energy.

An industry that can reduce greenhouse gas emissions, increase forest growth, and create jobs sounds too good to be true.  But that is the reality of the emerging wood pellets market in the Southern U.S.  That conclusion is supported by independent economic assessments of wood bioenergy, including a recent study that specifically focused on European pellet demand conducted by researchers at Duke and North Carolina State Universities.  Those researchers found that increasing demand for wood pellets resulted in more forest area, more forest investment, large greenhouse gas reductions, and little change in forest carbon inventories.

So, why is there concern?

Some critics have recently argued that land used to produce biomass for energy should instead be permanently protected as forests. They say that harvesting biomass from forests reduces forest carbon stocks. Instead, they claim that the best way to increase carbon storage is to reduce demand for renewable products that come from the land.

Those arguments fail to account for market dynamics and incentives, and do not recognize that these resources are renewable. Importantly, forests with little or no economic value are at greater risk for conversion to non-forest other uses.

A key to accelerating forest growth and regeneration is to create strong markets for biomass that will stimulate investments. Farmers and forest land owners, as with all business owners, respond to markets and invest in strategies to produce more and earn more when facing increasing demand.

Biomass energy markets are providing greenhouse gas benefits for Europe and can be a larger part of our domestic strategy as well.  The United States has committed to lowering greenhouse gas emissions by 26 to 28 percent over the next 10 years. One component of that strategy could be to expand renewable energy generation from forest and agricultural biomass.

The conclusions by the Duke and NC State researchers are not unique to the South.  Other studies have found that expanding the use of sustainably grown biomass for electricity production across the U.S. can actually increase forest acreage and carbon storage. Those studies show that as demand for biomass expands, the resource becomes more valuable at creating an incentive to grow and invest. Expanding the use of biomass for electric power will not result in the devastation of the American forests.  Rather, forest owners will more effectively and intensively manage forests to increase their value and optimize biomass production and use over time.

For example, USDA Forest Service researchers analyzed the potential effects of greatly expanding biomass electricity markets in the US. They found meeting 8 percent of U.S. electricity production from wood energy would require a 42 percent increase in harvesting; but they also found that a substantial portion of that increase would be offset over 50 years largely because of regrowth and market responses in land use and management strategies. They estimated that substituting biomass for fossil fuels to generate electricity could reduce greenhouse gas emissions by between 40 and 70 percent.

Larger trees and higher valued materials such as sawtimber, are not likely to be used for energy.  They are simply too valuable for uses such as structural building material, furniture, high end plywood, and veneer.  In reality, new markets for biomass energy can help supplement declining markets for low-value, small diameter wood, logging residuals, and the byproducts of manufacturing. In many parts of the country, wood energy can in turn help to reduce the risks of catastrophic wildfire and provide incentives for forest management needed to address the increased risks of insects and disease.

A great deal is at stake.  The nation’s forests provide us with many services. They filter the air we breathe, they provide millions of Americans with clean drinking water, they provide habitat and recreation opportunities and they offset about 13 percent of U.S. greenhouse gas emissions each year. Yet many of those services are at risk, in part due to the challenges of a changing climate: increased exposure to pests, diseases, and wildfire. Over the next few decades holding policies constant, carbon sequestration rates in our nation’s forests are expected to slow, mainly due to a loss of area principally to development.

Generating clean and renewable energy from biomass is an important and economic tool in our toolkit to address those challenges. Markets work. Increasing forest productivity and health makes them more valuable and less susceptible to conversion to other uses. Vibrant markets for wood materials raise the value of forest lands and encourage investment, regrowth and expansion. Using biomass for energy helps reduce greenhouse gas emissions by displacing fossil energy sources.

A healthy, productive, well-managed forest has high value, not just to the public and to the environment, but to the owner.  Shaping policies that recognize the real benefits of biomass and that provide incentives for continued performance improvements is a challenge, but the economic and environmental benefits that will be realized make this worth the effort.

Category/Topic: Energy Conservation

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Jun 08, 2015

...over 50 years...what happens in the mean time? How about sewage to alge, alge to #2 diesel? Leave the !@#$%^%&*))& trees alone. Or wind turbines based on vortex principle. Or more little hydro projects further upstream from spawning grounds. Or using tides to generate electricity. Or replace asphalt shingles with four foot rolls of solar panels and use drip edge strips to connect them, not as efficient as fixed panels but don't get in way of reroofing?

Jun 09, 2015

Agree with bl above. So our southern forests are being leveled to sell wood pellets to Europe and this is somehow good for forests and reducing greenhouse gases? Don't trees consume CO2? Sure vegetation converts solar energy to biomass which can then be burned, but wouldn't it be smarter and more enlightened to convert that solar energy directly into heat and electricity? How much petroleum is consumed to manage, harvest, process and ship the tons and tons of pellets to Europe? No, I don't get it at all and I'm tired of "create jobs" being used to blank check whatever moneymaking opportunity that comes around.

Stephen Goodale
Jun 09, 2015

Instead of trees support the use of marginal farm land to grow switch grass. The switch grass can then be converted into pellets with a comparable BTU factor to wood pellets. Switch grass can be harvested once a year and the plants tend to live for 14 - 15 years. It only takes three years for a stand of grass to grow to maturity, providing farmers with another renewable cash crop. It will also provide habitat and prevent erosion.

Jun 09, 2015

Like everything, moderation is the key. I agree with the use of wood pellets as part of a managed forest / tree management program.

I have been made aware here in France of the particle pollution caused by the burning of wood in home stoves. In some areas where air movement is small (valleys), it is in par with diesel engines or other fuel based heating (other than natural gas). So, I am fairly confident that the burning of wood pellet can be a risk for airborne particles. That too needs to be managed.

Go pellets!

James Goff
Jun 09, 2015

What do people not understand about renewable resource? Wind turbines, hydro, tides, solar panels, that's all good.
Everything at our disposal should, and eventually, will be used. What, are we not going to sell wood pellets in the U.S.? Don't be knee jerk reactionaries. I for one will invest in our country. Got any land for sale?

Gil DeHuff
Jun 12, 2015

What many "leave the trees alone" people don't understand is that trees don't live forever. When they die and are left in place their carbon is released just as if they had been logged. But as renewable resources, whether logged and converted into various products or left on the ground, that released carbon will be reabsorbed as part of the carbon cycle. Renewable resources don't increase the above ground carbons as opposed to petrochemicals and other below ground carbons which could have been stored below ground and remained permanently removed from the total level of above ground carbon.

The "leave the trees alone" is also devoid of scientific support in that it ignores the basic scientific principles of plant physiology. As can be seen in our US Federal Forests, the competition resulting from overly dense stands of trees weakens the health of the trees and decreases their ability to survive external stressors like drought and global warming. The increased proximity between trees in overly dense stands increases the probability that small fires and insect buildups will create catastrophic losses releasing large quantities of carbon at one time rather than at a lower more easily absorbed level. In addition such catastrophes do tremendous damage to soils and water ways as opposed to what would occur under sustainable sound forest management.

Jun 14, 2015

#1 its not the green house gases that are causing change..its a marketing gimmick for big business... Whats causing weather change is that the poles are shifting.. as they have over all time. causing different weather in different places desert where rain use to fall. Just take time and look at where the sun rises and sets verses where it did 20 years ago.. Stop being a puppet on a string for what ever the media tells you. Just like trees being cut. Take an acre of trees ,at a full grown status. There maybe a 200 tree mass at the most.. Then you cut this acre within a year they will be nearly 2000 trees in this area with many other plants. Its a proven fact. That an acre area with large trees verses the same acre after regrow starts..That 60% more carbon filtering occurs with regrow of much more volume of plants than when the same area had just larger trees which canopied the ground and prevented grow of other plants.

Jun 16, 2015

Trees are a RENEWABLE resource. Petroleum is not, neither is coal. Old growth forests generate little oxygen. Young stands of vibrant, growing timber generate much oxygen. The key is being good stewards of the land. When dense stands of trees are selectively thinned, the remaining trees respond by growing faster, generating more oxygen, sequestering more carbon, filtering the atmosphere.

Aug 08, 2015

Interesting article!
Here in Northern Europe we see a decline in pellet production, many factories shut down. This is due to a increase of geothermal heating for small houses and raw wood chip burning in central heatings.
Pellet production here in Scandinavia can only be made of softwood (spruce and pine in a mix) so the lignin can be used as a glue.

Aug 11, 2015

If what Gil deHuff and others have written is true. If trees represent a closed circle carbon cycle - therefore having a carbon neutral profile over a complete cycle - then why do we have fossil fuels deep beneath the earth's surface? Isn't part of that trapped carbon from tree biomass? If so, when we burn trees rather than let them decompose naturally, aren't we limiting the long-term sequestration offered by nature? It seems that biomass burning DOES create a carbon debt, both in the short and long term.

Mar 15, 2016

As one who wants to see the immediate cessation of Wood Pellets being burnt at Drax Powerstation in Yorkshire. I notice that all the comments only mention trees as a commodity and a singular item. In Living Energies 'An exposition of Concepts related to the Theories o Viktor Schauberger by Callum Coates. It is worth noting that he states 'We owe trees an enormous debt of gratitude for their silent, unceasing service in so many areas. Although extremely vulnerable to our depredations, they do not apparently protest, nor do they ever go on strike for better pay and conditions but continue day by day unstintingly to provide the wherewithal for all forms of life.
Citizens of the USA please stop sending Wood Pellets to Europe!

Dr. Luis Contreras
Apr 06, 2016

USDA sells timber from national forests. The 2015 USFS budget shows $20 million in sales of 300 million board feet.

“The FY 2015 President’s Budget includes a program level of $19,898,000 for the Timber Salvage Sales fund. The funding will be used to analyze, prepare, and offer new salvage sales while administering salvage timber sales awarded in the recent past. Salvage sale treatments primarily follow recent fire and insect outbreaks. In FY 2015 the Forest Service expects to sell approximately 300 MMBF (million board feet). The volume-outcome from this permanent fund is included in the unified volume sold target displayed under the Integrated Resource Restoration budget line item for FY 2014 and FY 2015.”

Dr. Luis Contreras
Apr 06, 2016

USDA sells timber from national forests. Pellet mills are a great market. Two new pellet mills with a total capacity of 1.3 million tons of pellets per year, exported to the U.K. Drax power station, are under construction at Pine Bluff and Monticello, Arkansas, near the Ouachita National Forest. To feed the new pellet mills, around 4 million tons of green wood per year will be used as feedstock: whole logs are used, with about 50 percent water per tree. Pellet mills = Deforestation.

Dr. Luis Contreras
Apr 06, 2016

Here is another way to interpret EU’s insatiable appetite for wood pellets, from an unhappy Enviva shareholder perspective.

Wood pellets, sold as clean coal, are attracting billions of dollars from people concerned with the new extreme weather. “Don’t ask, Don’t tell” is the wood pellet mantra, used by all parties to pretend sawdust and forest dregs are the sole feedstock for pellet mills, and no subsidies are used to provide low-cost, carbon-neutral energy. The mantra lets investors ignore superior, emission-free, low-cost, simple, resilient solutions: offshore wind and distributed solar systems.

Gil DeHuff
Nov 30, 2016

Re: Bill's comment "why do we have fossil fuels deep beneath the earth’s surface? Isn’t part of that trapped carbon from tree biomass? If so, when we burn trees rather than let them decompose naturally, aren’t we limiting the long-term sequestration offered by nature?"

When trees decompose naturally their released carbon goes into the air, soil and into other plants. The only way that we get "fossil fuels deep beneath the earth’s surface" is through geological upheaval that creates and destroys mountains and valleys. So, burning wood for fuel does not reduce the carbon stored below ground unless you are expecting massive geological turnover within the next couple of years and if that happens none of us will be around to benefit from it.