Energy: Biomass means big business

As governments sprint toward EU targets for renewable energy use in 2020 and the companies producing that energy battle for state subsidies and grid parity, biomass output in the Czech Republic has grown by leaps and bounds in recent years, but growing materials costs and discouraging investment hurdles still hinder the sector.

Biomass energy can be harnessed from any number of biological materials, and production of several of those materials has increased dramatically in the country. According to the latest statistics available, production of wooden pellets grew 15 percent in 2009 to 158,000 tons, according to the Industry and Trade Ministry. Consumption of wooden briquettes also rose in 2009 by 10 percent to 106,000 tons. As much as 230,000 tons of corn stock pellets were produced in 2010, according to the ministry's estimates, more than double 2009. 

State-subsidized boilers no doubt account for a fair amount of wood-based biomass usage by retail customers, and Jan Habart, chairman of the Czech Biomass Association (CZ Biom) says wood is one of the most common materials used for small-scale heating. "We are big in small-scale heating because one-third or more of biomass energy is supplied by chopped wood," he said. "Not only in cottages, but also in many villages, people use wood for heating."

Though the argument can be made that wood biomass sources deplete the forests, thereby negating their emissions neutrality, Habart says there are biomass energy sources that not only prevent any ecological footprint, but also help to clean up existing pollution. Biogas, he says, is a viable fuel source that is best produced from biodegradable municipal waste. "You solve the problem of diverting biodegradable waste that would otherwise end up in a landfill," Habart said.

Difficulties remain

So why is there no rush by investors to turn trash into cash? Habart says the feed-in tariff system actually discourages it by awarding higher subsidies to companies that grow their own agricultural biomass. This method of sourcing comes with its own complications, like limited space to grow energy crops and fluctuating food prices that encourage food farming in place of energy crops.

In December, the UN's Global Food Index reached record highs, calling into question the sustainability of long-term investments in biomass crops on arable land, since in a food crisis, food farming would make more economic sense for farmers.

Christoph Pfemeter is a technical engineer working on biomass projects in Austria, one of Europe's leaders not only in renewable energy, but also in biomass. He says 30 percent of the country's energy comes from renewables and 15 percent to 20 percent of the renewable energy is from biomass. He says the development of biomass production depends on several factors, but state support is definitely one of them.

"The main thing is feed-in tariffs for producers, but the next important step for small-scale operations is investment subsidies," Pfemeter said. "There are really high investment costs."

Biomass accounts for around two-thirds of the EU's total renewable energy portfolio, but only around 10 percent of consumption across Europe, according to Habart. This means projects to build large-scale facilities are still in the early stages in most cases, hence the high investment costs.

Despite what biomass promoters see as a less-than-ideal investment environment, biomass is more popular than ever. Pfemeter is working with the Austrian Biomass Association to organize the third Central European Biomass conference in Graz at the end of January, where organizers expect to see 800-1,000 industry professionals and researchers from the region. On the agenda are issues important to biomass energy development, and recommendations for individual national action plans will be discussed, as well as subsidies.

Habart says the EU Common Agricultural policy, the system of subsidies to farmers, which accounts for most of the body's budget, has shifted its focus from food security to land stewardship and has been doling out subsidies to land owners who leave their land fallow or as grassland. "It's good because it helps protect water sources," Habart conceded. "But it's also done that way because the strong producers like France want to produce a lot, and they're happy if we're not producing much."

"Biomass is the only renewable resource you can store. There are no emissions, and you can use it rain or shine," Pfemeter said. "We have plenty of biomass, and there is a lot of unused potential."

The Czech Republic is committed to reaching 13 percent renewable sources by 2020, though there are no specific targets for biomass.

Emily Thompson can be reached at
ethompson@praguepost.com