« What is the impact of the health crisis on the biomass/wood sector? »
This sector, so often put forward as a substitute for fossil fuels, is awkwardly positioned in France at this time of health crisis. Here’s why.
A sharp reduction in demand
A significant decline in demand for wood-energy was identified very quickly in some economic sectors. Since 15 March, the beginning of lockdown in France, many boilers and boiler rooms have been idling or are at a standstill. Some heat networks are no longer required because the public establishments they served, such as schools, swimming pools or hotel complexes, have been standing empty. Others, on the other hand, but fewer in number, have been in great demand (hospitals, old people’s homes etc), but in addition to gas-type fossil fuels, have not been able to compensate for these declines.
Fossil fuel prices at record lows
Moreover, the dramatically low prices of fossil fuels (especially gas and oil) are preventing a rapid recovery for the sector.
The professional federations (CIBE, FNB, ADEME etc) have recently intervened on the current difficulties facing the recovery of the biomass/wood sector, given the excessively low prices of fossil fuels and the very aggressive trade policies of the oil and gas sectors seeking to recover market share.
Abnormally high stocks
The available volumes of wood-fuel in France are currently increasing.
The wood sector first faces the problem of cutting down many "bark beetle-infested" trees intended to be burned in whole in boilers because they are unusable in first-stage processing. By digging galleries under the tree bark, these insects degrade their forests, forcing trees to be cut down quickly to prevent an even faster spread. The beetle epidemic is progressing and is currently spreading over most spruce forests in northern France.
Moreover, the stocks of French pellet producers in France are substantial, as the heating season has not been very active and the last supply campaign has not been intense.
On the other hand, stocks of wood waste from sorting centres - closed during the lockdown period - have melted away in recent weeks, leaving less volume available to export channels for northern European boilers. But this is a temporary situation...
It should be remembered that, with the exception of specific pellets for industrial boilers, other imports are supplemented by very active French production.
An imbalance between supply and demand that severely weakens the sector
The exacerbation of the supply/demand imbalance - with a reduction in needs on the one hand and very high stocks on the other - has seriously weakened the sector and is not conducive to recovery. Moreover, plans to develop new collective boilers in France have almost stalled, as a result of unfinished municipal elections preventing any decision-making by municipalities.
Despite the public authorities’ additional support and assistance measures, the sector does not foresee major changes in the situation in the short term. As this sector is seasonal, the recovery is expected to appear in the next campaign.
Despite a difficult period, biomass/wood is an up-and-coming sector
Within this constrained context, however, HAROPA's wood-energy maritime flows increased in the first four months of the year compared to the same period in 2019, reflecting the dynamics of this sector.
Although the economic issues have severely disrupted the sector, it remains on the up. Thus, wood is the primary renewable energy source used in France. This resource is therefore expected to make a significant contribution to France's energy and climate targets of significantly reducing fossil fuel consumption.