Biomass surpassed oil to become Sweden’s number one energy source in 2009, biomass now accounts for 32% of Sweden’s energy needs. Sweden plans to have half of its energy generated by renewable sources by 2020, and also plans to be completely independent of imported oil for transportation by 2030. Biomass energy production is predicted to rise by a further 11% in 2011 and it seems likely that they will realise their 2020 targets.
Between 2000 and 2009, total energy consumption from biomass in Sweden grew from 88 terawatt-hours (twh) to 115 twh, while the usage of oil-based products declined 21% from 142 twh to 112 twh during the same period, according to Svebio, the Swedish Bioenergy Association.
Biomass has been so successful in Sweden for four reasons. Firstly, general European plans have dictated that countries should have 20% of their energy generated by renewable sources by 2020, secondly, Sweden has a lot of the necessary timber infrastructure already in place, they also have higher energy prices than other parts of Europe, and finally, solar and wind power are not viable in Sweden due to environmental conditions.
This rise in the biomass sector has led to pressures on Sweden’s wood supply though, leading to price increases. According to Hakan Ekstrom of Wood Resource Quarterly, “Sawmills in Central and Northern Europe continue to have the highest wood costs in regions producing softwood lumber. These are also regions that have experienced the biggest price increases the past year. In Sweden and Germany, spruce sawlog prices were 28% and 15%, respectively, higher than in early 2009.”
Wood Resources Quarterly said a company’s global cost competitive position depends on its raw material base and the cost of available wood resources. Wood costs account for 40 - 50% of the production costs for pulp manufacturing, and 65 - 75% of the total production costs for sawmills.
The industry does face some problems though, the biomass is burned to generate heat and electricity and this raises questions about its carbon neutrality.