Report on Market Outlook and Future Viability of Different Bioenergy Products and Value Chains in the Baltic Sea Region Energy System

Report on Market Outlook and Future Viability of Different Bioenergy Products and Value Chains in the Baltic Sea Region Energy System

Main topic: Bio-based products, biomass supply chain
Document / search engine: Report on Market Outlook and Future Viability of Different Bioenergy Products and Value Chains in the Baltic Sea Region Energy System
Framework project: Unlocking the Potential of Bio-based Value Chains in the Baltic Sea Region
Short name of the project:
Website link: https://balticbiomass4value.eu/wp-content/uploads/2019/06/BB4V_A_2.1_REPORT_17.10.2019_V2_FOR_WEB.pdfli
CORDIS link if relevant:
Short description:

The share of renewables in the gross final energy consumption has increased steadily in the Baltic
region over the last decade. The use of biomass has increased by close to 40%. Solid biofuels
constitute 2/3 of the biomass use, but the production of biogas has increased more than 200% and is
currently about 15% of the bioenergy consumption in the Baltic region.
Heating and cooling account for more than a half of the energy consumption in most countries. In EU
households, space and hot water heating accounts for 79% of the total final energy use, whereas 71%
of the industrial energy use is for thermal purposes. 84% of heating and cooling is still generated from
fossil fuels, while only 16% is generated from renewable energy sources. The production of biogas has
increased significantly in the Baltic region in the last decade and is very important for reduction of GHG
emissions from waste and agricultural residues.
The use of biomass in the energy sector is expected to increase due to the reduced use of fossil fuels.
Increased use of biomass in district heating and biofuels for transport represent important
opportunities for increased use of bioenergy in the Baltic region.
The utilization of biomass and chips is increasing with increasing carbon prices. Most of the biomass
is used if the carbon price is high in 2030, while the lowest amount of biomass is used if the carbon
price is low in 2040.
The biomass is not an important raw material for electricity production in the Baltic region, but
indirectly the use of biomass is important to the electricity production, since around 33% of the
produced district heat comes from biomass. The biomass in the heating sector competes partly with
use of electrical boilers and heat pumps, which use electricity as a feedstock.
The most dominant grade of biomass used for production of heat and electricity in the Baltic region is
wood chips. The level of consumed chips is heavily dependent on the carbon price. The usage of biogas
increases both with year and carbon price. Bio oil is only used as a peak load for heat production in
2020. The use of bio oil is reduced with year, because of the higher cost of using bio oil than the cost
of using electricity and chips for heating. Biogas is increasingly used when the carbon price increases.
Initiatives to produce second generation biofuels for transport from lingo-cellulotic feedstock is likely
to increase the use of biomass in the transport sector.
Consumption of biomass in the industry sector consumption represents the largest uncertainty in
future biomass demand. Replacement of fossil coal and coke in the metallurgical industry carbon
represents important opportunities for increased biomass use. Targeted incentives are required to ensure economic sustainability for increased use of biomass in the
energy sector in the Baltic region. Increased costs for emission of carbon from fossil fuels will imply an
increased use of biomass in the Baltic region, especially in district heating, which represents a low
hanging fruit for reduced GHG emissions in many countries. Carbon costs, regulations, incentives and
knowledge are needed for this change. Biofuels for transport will continue to be based on agricultural
products in the next decade, but establishment of second generation biofuel plants is likely to gradually
influence the biofuel market.


Countries/regions described/represented: Denmark, Estonian, Finland, Germany, Latvia, Lithuania, Norway, Poland, Russian Federation, Sweden
Year: 2019