Biomass Power Generation Market to Reach USD 136.2 Billion by 2035, Driven by Energy Security and Decarbonization Goals - TMR

The global Biomass Power Generation Market is set for sustained growth, projected to expand from US$ 94.8 billion in 2024 to US$ 136.2 billion by 2035, registering a steady CAGR of 3.4% during the forecast period (2025-2035), according to the latest industry analysis.

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This growth trajectory reflects a global pivot toward renewable energy sources amid heightened concerns about climate change, energy security, and waste management. Biomass power-derived from organic materials such as agricultural residues, forestry by-products, municipal solid waste, and energy crops-has emerged as a reliable and dispatchable renewable source, capable of delivering consistent baseload energy to complement intermittent renewables like wind and solar.

Analysts' Viewpoint: Biomass as a Cornerstone of Clean Energy Transition

Industry analysts note that industrial users account for nearly 48% of global biomass energy demand, underlining the sector's role in ensuring continuous, carbon-neutral power supply. Europe leads the global market with an estimated 40% share, while the Asia-Pacific region is poised for the fastest growth, propelled by abundant feedstock availability and supportive government policies.

"Biomass has moved from being an alternative to becoming a mainstay in the clean energy mix. With carbon credit monetization, supportive feed-in tariffs, and circular economy benefits, biomass is positioned to become a commercially viable and critical component of the global decarbonization framework," analysts state.

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Key Market Drivers

Rising Global Focus on Renewable Energy and Decarbonization

Governments and industries worldwide are pursuing net-zero emission targets by 2050, with renewable sources expected to supply more than 60% of global power generation by 2030 (IEA).

The EU Renewable Energy Directive II (RED II) mandates at least 32% renewable energy consumption by 2030.

India aims for 10 GW of biomass-based capacity by 2030, supported by feed-in tariffs and carbon credit programs.

China generates over 140 TWh annually from biomass energy, reinforcing its role as a leader in renewable integration.

Abundant Availability of Agricultural and Forestry Residues

Over 140 billion metric tons of biomass from agriculture and forestry are generated globally each year-much of which remains underutilized. Biomass power plants provide an environmentally responsible means of converting waste into energy.

India produces 500 million tons of crop residues annually.

China utilizes 60 million tons of agricultural residues for 35 GW of installed biomass capacity.

In Europe, wood pellets and forestry waste form the backbone of renewable district heating networks.

Industrial Sector: The Largest End-use Segment

The industrial sector dominates biomass power generation, accounting for nearly half of global installations. Industries such as sugar, pulp & paper, and food processing are leading adopters due to their high energy intensity.

India's sugar sector produces over 8,000 MW of power from bagasse-based biomass plants.

The European pulp & paper industry consumes nearly 55 million tons of biomass annually.

Japan has commissioned over 70 biomass-fired power projects since 2020, each ranging between 5 MW and 50 MW.

Biomass enables industries to achieve energy security, cost reduction, and carbon neutrality, offering a strategic advantage in sustainability-driven markets.

Regional Insights

Europe - Market Leader (≈40% Share)

Europe remains at the forefront of biomass adoption, supported by stringent decarbonization mandates and district heating infrastructure.

Sweden and Finland derive over 20% of district heating from biomass.

Advanced waste-to-energy frameworks continue to make the region a benchmark in renewable efficiency.

Asia-Pacific - Fastest Growing Market

Asia-Pacific is witnessing rapid biomass integration driven by energy diversification and agricultural residue utilization.

Japan added 500 MW of biomass capacity in 2023 under its feed-in tariff program.

Thailand sources nearly 8% of its energy from biomass (primarily palm oil and sugar industries).
Government-backed renewable investments ensure long-term expansion and regional dominance in biomass power.

North America - Stable Growth with Rich Feedstock Availability

North America leverages its vast forestry and agricultural resources.

Canada produces over 2,000 MW from biomass power, especially in British Columbia.

Federal and provincial clean energy incentives continue to bolster the sector's development.

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Key Industry Players

The global biomass power generation market is highly competitive, featuring prominent companies such as:
Drax Group plc, ACCIONA, RWE, MGT Teesside Ltd, Babcock & Wilcox, Vattenfall AB, Ameresco, Inc., Engie SA., E.ON Global, Xcel Energy Inc., Energetický a Průmyslový Holding (EPH), RENOVA Inc., and EDF.

Drax Group plc - Operates one of the world's largest biomass power stations in the UK (2,500 MW capacity), driving BECCS (Bioenergy with Carbon Capture and Storage) initiatives aimed at removing up to 8 million tonnes of CO2 annually.

Ørsted A/S - Pioneering biomass-fired CHP plants and carbon capture projects in Denmark, targeting 400,000 tonnes of CO2 capture annually by 2025.

Recent Developments

Ørsted to commence carbon capture at its CHP biomass facilities in 2025, positioning them as carbon and green fuel hubs.

Drax Group submitted a Development Consent Order in 2024 to convert two of its biomass units to BECCS facilities, marking a major milestone in the UK's net-zero transition.

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