Global Biomass Power Market Snapshot 2035: Trends, Growth & Regional Insights
The global biomass
power generation market was valued at US$ 94.8 Bn in 2024 and is
projected to reach US$ 136.2 Bn by 2035, expanding at a steady CAGR
of 3.4% from 2025 to 2035. Growth is being shaped by the dual priorities of
strengthening energy security and accelerating decarbonization across global
economies.
Analysts’ Viewpoint
Biomass power remains a critical component of the renewable energy
mix because of its ability to provide dispatchable, baseload electricity—an
advantage over intermittent sources such as solar and wind. Industrial users
account for nearly 48% of global biomass power demand, leveraging it for
consistent energy supply and cost stability.
Europe leads the global market with nearly 40% share,
supported by progressive climate regulations and established district heating
networks. Meanwhile, Asia-Pacific is expected to record the fastest growth due
to abundant feedstock availability and rising energy demand. Leading players
such as Drax Group plc and Ørsted A/S continue to advance biomass integration
into large-scale grid systems and combined heat and power (CHP) facilities.
In the long term, supportive government incentives and
monetization of carbon credits are expected to reinforce biomass as a
commercially viable pillar of the clean energy transition.
Market Overview
Biomass power generation utilizes organic materials such as
agricultural residues, forestry by-products, wood pellets, municipal solid
waste, and industrial wastewater to produce electricity and heat. It
contributes to waste reduction and supports circular economy initiatives by
converting organic waste into usable energy.
Governments worldwide are encouraging biomass adoption
through renewable portfolio standards, tax incentives, subsidies, feed-in
tariffs, and renewable purchase obligations. Unlike wind and solar, biomass
plants can operate continuously, making them reliable baseload energy sources
for utilities and industrial facilities.
Emerging economies in Asia-Pacific and Latin America are
rapidly expanding biomass capacity due to ample agricultural residues and
increasing focus on domestic energy production.
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Key Market Drivers
Rising Global Focus on Renewable Energy and
Decarbonization
Global commitments to achieve net-zero emissions by 2050 are
significantly accelerating renewable energy deployment. Biomass complements
intermittent renewables by providing dispatchable power.
The European Union’s Renewable Energy Directive II (RED II)
mandates at least 32% renewable energy consumption by 2030, with strong
emphasis on plant-based biomass. India has set a national target of 10 GW
biomass capacity by 2030, while China generates over 140 TWh of biomass
electricity annually.
Supportive policies such as feed-in tariffs and carbon
credit programs continue to enhance commercial viability for industrial and
utility-scale biomass projects.
Abundant Agricultural and Forestry Residues
An estimated 140 billion metric tons of biomass residues are
generated annually worldwide. Much of this remains underutilized.
India produces approximately 500 million tons of crop
residues each year, much of which contributes to air pollution when burned.
Organized biomass power systems convert such waste into productive energy,
reducing environmental impact. China utilizes nearly 60 million tons of
agricultural residues annually, supporting over 35 GW of installed biomass
capacity. In Europe, forestry waste and wood pellets significantly contribute
to renewable heating and electricity.
End-use Insights: Industrial Sector Leads
The industrial sector accounts for nearly 48% of global
biomass power installations, driven by high and continuous energy requirements.
In India, the sugar industry generates over 8,000 MW
annually from bagasse-based biomass plants, serving both captive consumption
and grid supply. Europe’s pulp and paper sector consumes around 55 million tons
of biomass annually. Japan has commissioned more than 70 biomass projects since
2020, particularly in industrial parks.
Biomass enables industries to enhance energy security,
reduce carbon footprints, and achieve cost efficiencies through localized
residue utilization.
Regional Insights
Europe remains the leading region, holding nearly 40%
of global biomass capacity. Countries such as Sweden and Finland derive over
20% of district heating from biomass, demonstrating large-scale integration
into urban energy systems.
North America leverages abundant forestry and
agricultural feedstock. Canada alone generates more than 2,000 MW of biomass
electricity, particularly in British Columbia.
Asia-Pacific is the fastest-growing region. Japan
added over 500 MW of biomass capacity in 2023 under its feed-in tariff scheme,
while Thailand derives approximately 8% of its energy from biomass, primarily
using palm oil and sugar residues.
Competitive Landscape
Major players in the biomass power generation market include
Drax Group plc, Ørsted A/S, ACCIONA, RWE, MGT Teesside Ltd, Babcock &
Wilcox, Vattenfall AB, Ameresco, Inc., Engie SA, E.ON Global, Xcel Energy Inc,
Energetický a průmyslový holding (EPH), RENOVA, Inc., and EDF.
Recent developments highlight the sector’s transition toward
carbon-negative solutions. Ørsted plans to initiate carbon capture at its
biomass CHP stations in 2025, targeting 400,000 tonnes of CO₂ capture annually.
Drax Group has submitted plans to convert biomass units into Bioenergy with
Carbon Capture and Storage (BECCS) facilities capable of removing up to 8
million tonnes of CO₂ annually.
Conclusion
While growth remains moderate at 3.4% CAGR, biomass power
generation continues to play a crucial role in the global clean energy
landscape. With strong policy backing, industrial demand, and carbon capture
advancements, biomass is positioned as a dependable and scalable renewable
energy solution through 2035.
