Pelleting is a key process in the production of biomass fuel, where raw materials like wood, agricultural residues, or other organic matter are compressed into small, dense pellets. This process involves grinding the raw materials into a fine powder, conditioning them with steam or moisture, and then pressing them through a die to form uniform pellets. The goal of pelleting is to create a fuel source that is easy to handle, transport, and burn efficiently, providing a consistent energy output.
In the quest for more sustainable biomass sources, palm kernel shells and other agricultural by-products are gaining attention. Palm kernel shells, a by-product of palm oil production, offer a renewable and abundant source of biomass. Utilizing such residues not only provides an alternative to traditional wood pellets but also helps reduce waste and the environmental impact of palm oil production.
In a significant policy shift, South Korea announced it will end subsidies for new biomass energy projects and state-owned coal-biomass power plants starting January 2025. This move, described by the environmental nonprofit Solutions for Our Climate (SFOC) as the largest biomass policy rollback in Asia, aims to address environmental criticisms regarding biomass fuel’s carbon footprint and deforestation impacts.
Currently, South Korea is a major importer of forest biomass, notably wood pellets, which has fueled deforestation concerns in Southeast Asia. While subsidies for domestically sourced biomass remain, the reduction in support for imports is expected to alleviate some pressure on these forests.
Previously, South Korea provided substantial renewable energy credits (RECs) for biomass power, amounting to $688 million in subsidies for just one year. The revised policy will phase out RECs for imported wood pellets and eliminate support for certain state-owned biomass plants by 2025.
While domestic biomass will still receive subsidies, critics warn of ongoing risks to local forests. The policy change is seen as a positive step but highlights the need for further action to protect global forests and address climate change concerns.
In Asia, Japan is anticipated to overtake South Korea as the largest wood pellet importer by 2030. Despite financial incentives being withdrawn for new projects, existing Japanese biomass initiatives still enjoy government support, stressing the ongoing environmental challenge posed by the biomass industry.
Forest advocates are hopeful that South Korea’s reforms can influence neighboring countries. However, the industry may seek new markets as South Korean and Japanese imports stabilize, leaving the environmental and climate issues unresolved.