This study intends to analyse diverse aspects of the global bioenergy market. The insights offered in this report are expected to aid in market growth examination over the forecast timeline.
Market Analysis in Brief
In 2021, the global bioenergy market reflected modest growth and per industry figures, it stood at more than US$105 Bn in terms of value. According to a preliminary study carried out by Fairfield Market Research, the market will continue to grow at a healthy CAGR the long run. The market is a rapidly growing sector, driven by the increasing demand for renewable energy sources and efforts to reduce greenhouse gas emissions. This market includes diverse types of bioenergy, such as biofuels, biogas, and biomass power. Increasing investments in research and development, government support for renewable energy, and advancements in technology continue to foster market growth prospects. However, there are also challenges facing the industry, such as sustainability concerns and competition from other renewable energy sources.
Key Report Findings:
Increasing Investments in Renewable Energy Sources
Growing awareness concerning the importance of environmental protection has encouraged the power sector to focus on environment-friendly, cleaner sources of energy. Several economies worldwide are involved in boosting their renewable energy capacity in a bid to end dependence on traditional power generation solutions that require fossil fuels.
That said, the dependence on fossil fuels such as coal among others is on the decline owing to rising investments in sustainable and clean energy sources such as wind, geothermal, and solar energy. These being major sources of renewable energy, they can solve critical challenges related to the limited availability of various fossil fuels along with corresponding environmental issues. In addition, they can also be used in various sectors such as electricity, transport, and heat. This factor is expected to drive the growth of the bioenergy market in the coming years.
Escalating Demand for Liquid Biofuels
Among the distinct types of bioenergy, solid biomass, and liquid biofuels are expected to account for much of the bioenergy market. Solid biomass is derived from several types of feedstocks including forestry residues, pellets, wood fuel, agriculture crop residues, industrial and municipal wastes, as well as charcoal, among others. As such, the use of solid biomass for different applications has been on an upswing.
For instance, according to the International Energy Agency (IEA), in 2021, more than 35% of bioenergy used was derived from biomass. However, this usage is expected to drop in the coming years owing to environmental concerns. As per International Energy Agency, the use of biomass is projected to fall to zero by the end of 2030. The use of modern bioenergy, excluding the use of biomass, will double to reach approx. 80 EJ by 2030.
On the other hand, the demand for liquid biofuel is poised to increase rapidly. This is owing to diminishing natural energy resources backed by increasing awareness about the use of environmentally sustainable energy sources. According to the IEA, during the 2021-2026 period, the demand for biofuels is estimated to increase by 28% or 41 billion litres globally.
In addition, soaring prices of crude oil worldwide have caused the need for alternate fuel sources. This has propelled the use of liquid biofuels on a global front, thus influencing the economic growth of the bioenergy market.
Overview of Key Segments
Demand from Logistics and Transportation Industry Noteworthy
Biofuels are considered apt substitutes for petroleum-based products used in the logistics and transportation sectors. Moreover, biofuels are considered a vital part of key strategies to enhance fuel security, support infrastructure development, and mitigate climatic changes. To achieve compliance with critical emission standards and targets that are set by respective government bodies in an effort to reduce global warming, a significant contribution from advanced biofuels would be necessary. That said, their use in the logistics and transportation industries are expected to grow considerably in the coming years.
In addition, the aviation sector is one of the biggest consumers of energy. Growth in the aviation industry is likely to complement the production and use of biofuel, which in turn is poised to aid the growth of the bioenergy market. Overall, with the rapid expansion of the logistics and transportation industries, new potential avenues and revenue growth opportunities are likely to arise for the market.
Restricted Feedstock Availability, and Infrastructural Limitations
Bioenergy production requires vast amounts of feedstocks such as forestry residues, crops, and municipal waste. The availability of these feedstocks is limited, particularly in certain regions or areas of the world. Additionally, the necessary infrastructure needed for bioenergy production such as storage facilities and processing plants can be expensive to both build and maintain. The bioenergy sector also faces stiff competition from other energy sources such as nuclear, wind, and solar power, as well as fossil fuels. Factors such as these are expected to have a detrimental influence on the further growth of the global bioenergy market.
Growth Opportunities Across Regions
Europe to Emerge as a Potential Revenue Funnel
The bioenergy market in Europe is expected to register incremental growth in the coming decade. As of 2020, developed economies in Europe stood at the forefront apropos to the production of bioenergy. Bioenergy in Europe is poised to gain high traction in the coming decade in order for countries in this region to meet their renewable energy targets by 2030. That said, the European Union has incorporated bioenergy alternatives in its National Renewable Energy Action Plans (NREAPs).
Among other countries, Germany is likely to dominate the bioenergy market in Europe. It is one of leading economies involved in the production and use of bioenergy. According to the International Energy Agency, Germany, in comparison with other countries, ranks at the top with regards to biofuel consumption. Moreover, in 2021, the German government agreed on National Climate Pact by amending its Climate Protection Act to reach ambitious targets such as Green House Gas reduction of 65% by the end of 2030, a further reduction by 88% by 2040, and climate neutrality by 2045. These aspects are instrumental in bolstering the growth of the bioenergy market in Europe.
Key Market Players – Bioenergy Landscape
Some key companies in the bioenergy market include, Mitsubishi Heavy Industries Ltd., Orsted A/S, Hitachi Zosen Corporation, BTG Biomass Technology Group, Fortum Oyj, ADM (Archer Daniels Midland), Enviva, Enexor Energy, Lignetics, Enerkem, Green Plains Inc., Drax Group, and MVV Energie AG., to name a few. Key players in the market have been involved in new product launches and are implementing other growth strategies such as collaborations and acquisitions to strengthen their position.
Bioenergy Market: Key Developments
Regional Classification of the Global Bioenergy Market is as Below:
Middle East and Africa
*Regions and countries are subject to change based on data availability
Key Elements Included In The Study: Global Bioenergy Market
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