Biomass energy: The rebirth of agricultural and municipal waste

The straw in the fields is no longer burned at will, and the garbage in the city is sorted in an orderly manner, making our sky bluer, air fresher, land and water purer. Where does that unburned straw and orderly sorting go? They are transformed into biomass energy such as electricity, gas and oil, which starts again for our better life and creates value again.

Under the promotion of national environmental protection and energy development policies, biomass energy has ushered in rapid development in the past decade, and the energy supply scale has increased from 12 million tons of standard coal in 2010 to 47 million tons of standard coal in 2020, with an average annual growth rate of 15%. Under the continuous promotion of national policies, by 2025, the national biomass energy supply scale is expected to exceed 70 million tons of standard coal, and continue to maintain rapid growth.

• Biomass power generation/heating: In the short term, due to regional biofuel shortage, environmental protection requirements, state subsidy reduction and other factors, biomass power generation/heating will enter an adjustment period; In the long run, benefiting from the abundant fuel supply across the country and the country's 25GW construction target for rural clean electricity/heat, biomass power generation/heating will usher in steady development.

• Bio-gas from municipal waste: Many cities plan to achieve 80%-100% waste sorting and recycling and treatment by 2030, and bio-gas from municipal waste will usher in a new round of growth due to its low air pollution emissions.

• Rural biogas: Under the trend of concentration of aquaculture industry, large-scale rural biogas facilities have gradually replaced household biogas ponds to become the mainstream of the market; It is expected that in the future, under the incentive of further farming centralization and policy subsidies, rural biogas will usher in rapid growth.

• Biodiesel: Export to the EU is the most important sales channel of China's biodiesel industry. In the next few years, with the further increase in EU demand, the gradual rise of domestic demand and the continuous improvement of raw material collection, the biodiesel market will maintain a strong growth momentum.

Bioethanol: Bioethanol has a broad demand space, but limited by food security issues, high-starch crop bioethanol further development space is limited; If the cellulosic bioethanol manufacturing technology can be broken through, the supply capacity of bioethanol in China will be greatly improved.

This paper will briefly introduce the basic situation of China's biomass energy market from the dimensions of development status, industrial pattern, future opportunities and challenges in these five segments.

1 Biomass power generation/heating

Biomass power/heating generally refers to simple power generation or cogeneration by burning crop straw and forestry waste. From 2005 to 2020, under the promotion of policies, China's biomass power generation/heating field has gone through three stages, and the cumulative new biomass power generation/heating equipment has reached 13.3GW.

Due to the localized nature of biomass collection, storage and transportation, the biomass power generation/heating market pattern is more dispersed, and many state-owned power enterprises, private leaders and private small and medium-sized enterprises are involved. Local governments play a decisive role in the project initiation and approval process, but less directly affect the daily operation of biomass power (thermal) plants.

In the short term, affected by factors such as regional fuel shortage, increased environmental protection requirements for exhaust gas, and the gradual withdrawal of state subsidies, the field of biomass power generation/heating will enter an adjustment period.

• Due to the lack of comprehensive capacity planning, some areas with abundant biomass fuel have experienced excessive installed capacity and insufficient fuel supply, resulting in higher biomass power/heating costs.

• Since 2020, some provinces (such as Henan, Shandong, etc.) have put forward higher requirements (<20mg/m3) for the content of nitrogen oxides in the exhaust gas of local biomass power (thermal) plants, resulting in an additional fixed asset investment of about 15% for biomass power/heating enterprises.

• In 2020, the state requires that the total amount of subsidies paid by the central finance for new biomass electricity (heat) plants be controlled within 1.5 billion yuan per year, and the total amount of subsidies will be reduced year by year; Local government subsidies, while negotiable, are significantly lower than state subsidies.

In the long run, there is considerable fuel supply potential across the country, and with the continued policy support of the government, the biomass power generation/heating market will usher in steady development.

Although demand for fuel has exceeded supply in some areas, 85% of biomass fuel is still not used effectively nationwide.

By 2035, the state plans to build 25GW of biomass cogeneration units as a source of clean electricity/heat in rural areas.