The forest products industry is the nation’s leading producer and user of carbon-neutral renewable biomass energy.
While other emerging technologies are being developed, today’s biomass energy is heavily dependent on wood fiber. This same woody biomass is an essential raw material for value-added forest products, such as paper, packaging, wood products, wood-based chemicals, and other innovative wood-based products.
Forest products facilities produce 70 percent of the renewable biomass energy used by the entire manufacturing sector. Most renewable biomass energy in the forest products industry is a byproduct of the manufacturing process. This use of biomass energy is among the most efficient in the world, using residues that would otherwise be waste to create both thermal and electrical energy, commonly referred to as combined heat and power (or cogeneration) technology.
Government policies that pick winners and losers by mandating a particular use for a raw material or fuel that would otherwise not be viable are misguided and should be avoided.
A growing number of prospective and existing government mandates and incentives promote the use of biomass for energy, including state and federal Renewable Electricity Standards, climate policies, and the Renewable Fuel Standard. The rapid increase and the combined effect of these mandates could affect the balance between the many users of, as well as the long-term sustainability of, the forest resource.
Policymakers should be mindful of growing demand for U.S. biomass to meet domestic and international renewable energy policies.
Recent increases in the demand for U.S. biomass to meet the European mandates for renewable energy have resulted in a surge in U.S. exports of subsidized wood pellets from less than 10,000 metric tons in 2007 to about 2 million metric tons in 2012. As European demand continues to grow in the future, it will impact availability of wood for energy and manufactured product in the U.S.
- AF&PA opposes mandates and incentives that distort the market for woody biomass raw material.
- AF&PA believes market forces, not government mandates and incentives, should determine the use of wood and wood residuals for renewable energy. Where state or federal governments institute incentives or mandates for renewable energy, those policies must treat existing industry energy generation from biomass equally with newly created renewable energy generation, promote sustainable forest management, and provide incentives for reliable and affordable regional fiber supplies rather than a particular use, while maintaining open market access.
- Studies show that per ton of wood used, the forest products industry sustains nine times as many total jobs as the biomass energy sector. Federal renewable energy policies should not require forest products manufacturing facilities to compete with their power suppliers and other energy producers for biomass fiber on an uneven playing field.
- Policies that have the unintended effect of diverting biomass supply to subsidized energy use have the danger of undermining existing, highly efficient renewable energy production at existing facilities in the forests products industry. These policies should be avoided, because the risk of manufacturing job loss due to product diversion is compounded with the loss of existing renewable energy use.
- Similarly, AF&PA also opposes any definition of biomass that includes municipal solid waste that does not specifically exclude commonly-recycled materials, because these policies risk diverting an important source of raw material for many of our manufacturing facilities.
- Recognizing the long growing cycle for forests, we believe any government policies that encourage additional demand for biomass should be coupled with policies that increase the available long-term supply of wood to meet future demand for paper and wood products as well as new and growing energy markets. Policies also should include safeguards to minimize disruptions in the flow of fiber and related market distortions.