The European Biochar Industry Consortium (EBI) has announced the release of its annual European Biochar Market Report. This year’s edition of the report provides valuable insights into the growing significance of biochar, particularly in district and industrial heating systems while also examining charcoal production facilities and those within the metallurgical industry, focusing on carbon-preserving applications.
As part of the launch, EBI held two consecutive webinar presentations of the report on March 20 and 21, 2024 respectively, which combined, had around 400 participants from around the world.
The report, European Biochar Market Report 2023/2024, was sponsored by Carbon Drawdown Initiative, Carbon Removal Partners, and Carbonfuture.
District energy operators and municipalities keen on achieving net-zero goals will find this report particularly enlightening as it explores how biochar can be leveraged to meet sustainability targets while providing numerous examples of case implementations, several of which have been featured on this platform.
The featured reference projects in the report are representative split on countries/regions and system size – medium to industrial size (from 200 to over 5,000 tonnes per annum).
They were selected based on the equipment supplier has already realized multiple projects that are up and running with an operational experience of several years and the equipment has proven to be capable of producing certified biochar, the Reference Project itself is either operational or in construction and has a “smart energy utilization concept” – a key point that transcends the entire report.
Continued strong biochar growth
According to EBI figures, biochar production capacity in Europe continues to show strong growth. In 2023 it grew to 75,000 tonnes of biochar, 41 percent up on 2022 and is expected to grow to 115,000 tonnes in 2024.
The three-year compound annual growth rate (CAGR) 2020 – 2023 was 54 percent, and based on the project pipeline for 2024, this growth rate is expected to be maintained at 55 percent.
In 2023 a total of 48 biochar production plants have been installed and commissioned. By the end of 2023, the cumulative number of operational biochar production plants in Europe has grown to 171 installations.
By the end of 2024, the cumulative number of production plants in Europe is expected to grow to over 220 installations. Many further projects are in advanced planning and/or in the permitting process for commissioning in 2025 – almost 40 projects with around 35,000 tonnes of production capacity.
Nordics key region for BCR
The report highlights that about 70 percent of the production capacity at the end of 2023 is distributed among three dominating regions/countries of which the Nordics (28%) with Denmark, Finland, and Sweden has grown to become the most relevant region in terms of Biochar Carbon Removal (BCR).
Germany (26%), Austria, and Switzerland (16%) come in as second and third respectively while the share of “other countries” is steadily increasing with EBI noting most “relevant activities” occurring in Spain, France, and the UK.
The Nordics become even more prominent if other non-BCR uses are included as there is additional biocarbon production in Finland, Sweden, and Norway catering to the metallurgical industries.
Market trends
The report notes that although valorization of the climate benefit of BCR, for example, revenue from carbon dioxide (CO2) certificates on voluntary carbon markets (VCM), has become an indispensable element of the biochar business, “only” circa 75 percent of the production capacity is certified carbon removal.
At the same time, rapidly increasing production volumes have put market prices for biochar under pressure.
Looking ahead, markets expected to show the strongest growth include applications in concrete production, and urban soil while the replacement of fossil carbon in metallurgy, a non-BCR application, is becoming a relevant application for biogenic carbon.
The report notes that over 30 technology providers are active in the European market, many at a technology readiness level (TRL) 8 or 9, and some having already installed dozens of systems.
EBI expects to see a continuation of new industrial players entering the market as the industry grows.
On the feedstock side, while woody biomass such as forestry- and wood processing residues continue to dominate, agricultural residues are increasingly becoming relevant along with other municipal organic waste (MOW) sources such as sewage sludge.
Heat utilization essential
Keeping a “smart energy utilization concept” in mind, the report also emphasizes that the “best possible valorization of the surplus energy” produced in biomass pyrolysis is “essential for the commercial viability of projects.”
With a massive expansion of wind and solar PV driving the de-fossilization of Europe’s electricity generation system, replacing fossil carbon in the metallurgic industry, like iron and silicon, has started to become important for several producers.
De-fossilizing the heating sector and replacing fossil carbon in metallurgy is the bigger challenge, remarked Hansjörg Lerchenmüller.
This may also partially explain why the Nordics, Germany, Austria, and Switzerland are emerging as the most relevant regions – widespread use of distributed energy such as district heating and/or cooling with infrastructure already in place, deployment of biomass use for energy, and sizeable metallurgical industry.
BCR and BECCS sensible CDR pathways
The report looks at the inherent correlation between emissions reduction and carbon removal for the definition of “sensible” net-zero pathways.
The carbon dioxide footprints of energy generation are important to find sensible net-zero pathways. BCR is a no-regret solution; it contributes both to carbon removal and emissions reduction through the provision of industrial- and/or district heating, said Hansjörg Lerchenmüller.
Of the six CDR options – afforestation/reforestation, soil carbon, enhanced weathering, biochar carbon removal (BCR), bioenergy with carbon capture and storage (BECCS), and direct air carbon capture and storage (DACCS) – the latter three have an inherent correlation with energy.
To understand the effect of the correlation between emissions reduction and carbon removal, the CO2 footprints of energy generation need to be taken into account. The net CO2 effect per captured tonne of CO2 – a key metric for effective climate impact – is highest for BCR. Regardless of the progress on de-fossilization, BCR always has the highest net CO2 effect per tonne of CO2 removed, explained Hansjörg Lerchenmüller illustrating with the EU 2030 target for reduction of the carbon footprint of heat to 150 g/kWth and electricity to 110 g/kWe.
Another key metric highlighted in the report is the net CO2 effect per tonne of biomass given that biomass is a limited resource.
With the current average carbon footprint of the EU energy system (225 g/kWth for heat and 200 g/kWe for electricity), BECCS shows the highest net CO2 effect per tonne of biomass while biomass efficiency in the BCR options is comparable to the energy-only use of biomass, ie. bioheat, biopower and/or combined heat and power (CHP).
However, with a reduction in the CO2 footprint of the energy system, the BCR options become more advantageous to the bioenergy-only options.
BCR shows higher net CO2 effects than conventional bioenergy solutions and is a good option when infrastructure requirements and/or economics prove too difficult or prohibitive for BECCS. Furthermore, a combination of BCR and CCS is comparable to BECCS. However, different CDR technologies will have different growth trajectories and sweet spots; only a portfolio approach can deliver the required amounts of carbon removal, Hansjörg Lerchenmüller said adding that EBI is setting-up a project to make a sweet-spot analysis for different CDR technologies.
Biochar is a relevant and scalable CDR solution
Thus far biochar has demonstrated a strong track record for fast growth. Looking ahead, the report looks at several forecast scenarios for 2030 and beyond to assess if this is achievable and to what extent.
Assuming a carbon removal of 2.8 tonnes of carbon dioxide per tonne of biochar and extrapolating a growth rate of 50 percent, this would bring BCR to 2.3 million tonnes by 2030, which is equivalent to just under half of the ambition of the EU Commission for permanent technical carbon removal.
The report finds that to achieve 2.3 million tonnes of BCR by 2030, the number of newly installed production plants will need to grow from 41 installations in 2023 to just over 300 new plants by 2030.
The cumulative installations will have to grow from 171 plants in 2023 to 1,250 plants by 2030, a growth rate of 33 percent. This is lower than the 50 percent production growth rate as the average system size is also expected to increase, Stiesdal’s SkyClean plant is a case in point.
EBI modeling beyond 2030, to 2040 with lower- and higher growth rates respectively suggests between 40 – 80 million tonnes of BCR, in line with the European Commission’s 2040 target of 75 million tonnes for permanent technical CDR (including BCR) and an overall target of 400 million tonnes for all CDR solutions.
Are these 2030 and 2040 scenarios feasible? The report finds that for technology providers, a growth rate of 33 percent in the number of installations appears to be perfectly achievable. Although project development, permitting, and financing can be improved, in principle it does not seem to be a limiting factor for growth either.
While a limited resource, biomass availability is not foreseen as a major constraint given the availability of untapped resources such as agricultural residues and other sources such as green waste, sewage sludge, and digestate from biogas plants.
Furthermore, as BCR shows higher net CO2 effects than conventional bioenergy combustion systems, it is feasible that a share of the existing fleet of around 143,000 medium-sized combustion plants (1 – 50 MW) will be retrofitted and/or replaced with pyrolysis technologies.
BCR is today’s most relevant industrial CDR technology for permanent carbon removal, and it is capable of delivering carbon removal at climate-relevant volumes within 15 years. However, if we don’t cut emissions, creating carbon sinks is irrelevant, ended Hansjörg Lerchenmüller.
