Difficult and Costly Energy Transition unless the EU Invests in Biomass

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May 01, 2025

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(Chalmers University of Technology) Biomass is currently the EU’s largest renewable energy source, but climate strategies often focus on other energy sources. A comprehensive analysis, led by Chalmers University of Technology in Sweden, now shows that biomass is crucial for Europe's ability to reach its climate targets, as it can be used to produce fossil-free fuels and chemicals and also enables carbon dioxide removal from the atmosphere. If biomass were excluded from the European energy system, it would cost an extra 169 billion Euros per year – about the same as the cost of excluding wind power.

Biomass, such as energy crops, logging residues, cereal straw and wood waste, is a versatile source of renewable energy that many industries want to use to reduce their greenhouse gas emissions. Biomass can replace fossil fuels, for example in steel and cement industries and in power plants that supply households with electricity and district heating. It can also replace oil and fossil gas in the production of plastics and chemicals, as well as the production of fuels for vehicles, shipping and aviation.

In addition, biomass can play a key role in an increasingly important part of the climate transition: carbon dioxide removal from the atmosphere, via carbon capture and storage (CCS). The carbon atoms in biomass have been absorbed from the air through plant photosynthesis. Normally, when biomass is used for energy the carbon atoms are released back into the air as carbon dioxide. But when bioenergy is combined with CCS, those carbon dioxide emissions are avoided. Biomass use with CCS therefore provides energy along with carbon dioxide removal from the atmosphere, which is known as negative emissions.

Rapidly increasing costs if the amount of biomass is reduced

With growing demand for non-fossil alternatives, the competition for renewable resources has intensified – prompting policymakers and industry to address questions about policies and investments into resources and technologies that effectively support the energy sector's climate transition. As biomass has so many uses, scientists are grappling with questions about the role of bioenergy in the energy system. How is the energy sector's climate transition affected by the varying availability of biomass? How and where is biomass best used?

In a paper in Nature Energy, researchers at Chalmers University of Technology, Rise Research Institutes of Sweden and Technische Universität Berlin have carried out a comprehensive analysis and shown what a future European energy system could look like – including electricity, heating, industry and transport.

The researchers investigated two emissions targets for the energy system; one with zero emissions of carbon dioxide and one with negative emissions (minus 110 per cent compared to 1990). The biomass in the system consists mainly of waste material from forestry and agriculture within Europe, plus a more expensive part which can be imported.

The study's lead author Markus Millinger, a researcher at Chalmers when the study was conducted and now a researcher at Rise, notes that biomass plays an unexpectedly important role in the energy transition.

“One thing that surprised us was how quickly it becomes very expensive if we reduce the availability of biomass in the energy system, due to the high costs of alternatives. If biomass is completely excluded, the costs of the energy system with negative emissions would increase by 169 billion Euros annually, compared to the same system with a cost-optimal level of biomass. This is an increase of 20 per cent, which roughly corresponds to the cost of excluding wind power.”

If biomass availability is limited to the current level of biomass use in the European energy system, the additional cost is 5 per cent compared to the cost-optimal level.

“But the financial part is perhaps not the largest problem”, says Markus Millinger. “The big difficulty may be to scale up the alternatives. Even with biomass in the system, it is a real challenge to expand fossil-free energy to the extent needed. Further restrictions on the supply of biomass would make the energy transition very difficult, as even larger amounts of other types of fossil-free energy would be needed.”

“In addition, we would miss out on the opportunity for negative emissions that the utilisation of biomass provides. To then achieve negative emissions in the energy sector, carbon capture directly from the air would instead have to be scaled up to a large extent. This is a significantly more expensive technology that requires an energy input instead of providing a net energy output.”

Capturing carbon dioxide is most important

A central conclusion of the study is that the value of biomass in the energy system is primarily linked to the fact that it contains carbon atoms. Biomass as an energy source is less important. The large-scale technologies we have today to utilise the energy content of biomass, for example by burning it in power plants, can be combined with technologies to capture the carbon dioxide in the waste gases. Then the carbon dioxide can either be stored permanently underground or reused as a building block in products such as fuels and chemicals.

Biomass can thus supply energy and simultaneously enable negative emissions or replace fossil raw materials. And it is the latter opportunities that have now proven to be most important for the climate transition. Consequently, it is crucial that the carbon atoms are captured to be stored or reused efficiently, but it matters less how the energy content of biomass is used.

“As long as the carbon atoms are utilised, it is not crucial in which sector biomass is used, except that it is an advantage to use a small share of the biomass as a flexible reserve for electricity production to strengthen supply reliability”, says Markus Millinger. “Factors such as regional conditions and existing technical infrastructure are therefore important to determine what is most favourable. This means that countries can choose different paths if they want to use biomass to achieve negative emissions – for example via the production of electrical power, heat or biofuels.”

Provides an expanded knowledge base for policy development

The researchers have used an advanced model that includes more technologies and a higher level of detail than previous similar studies. The model also shows how all society sectors affect each other within the energy system. The new study thus provides an expanded knowledge base for policy development – not least linked to biomass and technologies for negative emissions.

“The capture and storage or reuse of carbon dioxide, for example through the production of advanced fuels, is dependent on large investments to get started, and long-term sustainable and reliable value chains need to be built. A market for fossil-free carbon dioxide would significantly strengthen the opportunities for such investments compared to today, when it is primarily the energy that is valued. But this requires that decision-makers create stable policy instruments to realise the great value of fossil-free carbon atoms within the climate transition”, says Markus Millinger.

Technology development and policy have stimulated an increasing utilisation of bioenergy in the EU. But there are also policy instruments that limit its use in various ways, based on concerns about possible negative effects such as higher food prices, deforestation and loss of biodiversity.

“The bioenergy sector is developing in a context where agriculture and forestry are meeting increasing sustainability requirements”, says Göran Berndes, co-author of the study and Professor of Biomass and land use at Chalmers. “Given that the climate transition is expected to increase the pressure on forests and agricultural land, it is important that there are regulatory systems that lead the development in a positive direction.”

“At the same time, bioenergy systems can be designed to contribute to more efficient use of resources and mitigation of the negative environmental effects of current land use. If policy instruments are designed to reward landowners and other actors for 'doing the right thing', this in itself can drive development away from environmentally harmful activities”, says Göran Berndes.

More about: the study

The paper Diversity of biomass usage pathways to achieve emissions targets in the European energy system has been published in the journal Nature Energy. In connection with the paper, Nature Energy also published a policy overview by the researchers: Biomass exclusion must be weighed against benefits of carbon supply in European energy system.

The authors of the articles are: M. Millinger (Chalmers University of Technology and Rise Research Institutes of Sweden), F. Hedenus, L. Reichenberg and G. Berndes (Chalmers University of Technology), and E. Zeyen and F. Neumann (Technische Universität Berlin).

More about: the possibilities of biomass within the energy and climate transition

Biomass from agriculture and forestry is a flexible renewable resource that can be used for many different purposes:

Electricity and/or district heating through combustion in power plants or combined heat and power plants.
Biofuels and electrofuels for aircraft, ships and cars.
Chemicals, plastics and other materials.
Process heat for industries, e.g. in steel and cement production.

All of these options can to various extent be combined with carbon dioxide capture from the flue gases. The carbon dioxide can then either be permanently stored underground (CCS, Carbon Capture and Storage) or reused as a building block for various products.

When biomass is the feedstock, CCS results in net-negative emissions. This means removing carbon dioxide from the atmosphere, as the plants have taken up carbon dioxide from the air, which is ultimately stored underground. This type of carbon capture is called BECC (Bio-Energy with Carbon Capture).

There is also technology for capturing carbon dioxide directly from the air, so-called DAC (Direct Air Capture). DAC requires a substantial energy input, in contrast to BECC, which provides a net energy output along with carbon capture. DAC is also a significantly more expensive option.

Net-negative emissions, via BECC or DAC, play an important role in many countries' climate strategies.

More about: the cost of reducing biomass use

The EU and UK have adopted targets of net-zero greenhouse gas emissions for all sectors to comply with the Paris Agreement targets. To achieve such targets, residual greenhouse gas emissions, such as methane emissions in agriculture, need to be offset by carbon dioxide removal from the atmosphere; so-called net-negative emissions.

In the new study, the researchers have presented the most cost-effective way to achieve a European energy system with net-negative emissions, resulting in 110 percent lower carbon dioxide emissions than in 1990. Compared to that scenario, the researchers have shown what it would cost to reduce the amount of biomass in the system to different levels, all the way to a total exclusion of biomass, which would increase Europe's costs by €169 billion annually. This approximately corresponds to:

1 per cent of Europe's GDP.
Europe's defence expenses before the war against Ukraine.
An additional cost of 20 per cent compared to the most cost-effective energy system.
The cost of removing all wind power, or all hydrogen produced with electricity, from the energy system.
Twice as much as the cost of removing all solar energy from the system.

The researchers have also made the same analysis for a European energy system with zero emissions of carbon dioxide. That scenario would be 14 per cent more expensive if biomass were excluded.

The reason why it is so expensive to reduce the amount of biomass is that it can offer both energy and fossil-free carbon simultaneously. Replacing both of these resources – with more energy from other energy sources as well as direct air capture of carbon dioxide – results in a much higher cost.

More about: EU bioenergy policy

Both forestry and agriculture can produce biomass for the energy system, and depending on a variety of factors, bioenergy can be associated with both positive and negative effects in terms of sustainability aspects other than the climate. Within the EU, there is concern about risks associated with the cultivation of energy crops and logging, such as competition with food production, deforestation and loss of biodiversity.

While policies have increased bioenergy development in the EU, there are also policy instruments that limit the use of biomass for energy purposes. For example, restrictions have been introduced on biofuel production from feed and food crops, and further restrictions have been proposed on residues from forestry. In addition, policy instruments that affect agriculture and forestry in general can lead to a limitation of the availability of biomass for energy purposes.

Chalmers University of Technology in Gothenburg, Sweden, conducts research and education in technology and natural sciences at a high international level. The university has 3100 employees and 10,000 students, and offers education in engineering, science, shipping and architecture.

With scientific excellence as a basis, Chalmers promotes knowledge and technical solutions for a sustainable world. Through global commitment and entrepreneurship, we foster an innovative spirit, in close collaboration with wider society.

Chalmers was founded in 1829 and has the same motto today as it did then: Avancez – forward. READ MORE