European Parliament adopted REDIIIVoting to Maintain the Status of Forest Biomass as Renewable Energy

in Japanese

On September 14th, 2022, at the plenary session of the European Parliament in Strasbourg, amendments to the EU's Renewable Energy Directive (REDIII) were approved.¹ As a result of this vote, the renewable energy contribution target was updated to 45% of final energy consumption by 2030. In the legislative process of the EU, the EU Council, consisting of the ministers of member states, shares legislative rights with the European Parliament, and a formal trilogue was scheduled with the European Commission to propose an amendment of the directive, with the final text being adopted by the end of 2022.

The draft of REDIII, which was submitted by the European Commission in July 2021, proposed to strengthen bioenergy sustainability criteria. Following the initial proposal, discussions on woody biomass derived directly from forests (i.e., forest biomass) became a major source of controversy.

In the EU, bioenergy is an important renewable energy source, providing 60% of all renewable energy, with forest biomass in particular making up 20% alone. Critics of the current status quo, including environmental NGOs, state that “energy use has increased forest harvesting” and “forest biomass is worse than coal, causing carbon debt”, resulting in the argument that “forest biomass should not be considered as renewable energy”. Attention was focused on the outcome of the vote.

In summary, the EU Parliament voted not to change the basic framework of maintaining the definition of forest biomass as renewable energy that can be used for RED target accounting. However, considering the risk that more use of forest biomass might increase forest harvesting, the share of forest biomass from total energy consumption is required to remain at 2017–2022 levels.

Focusing on Primary Woody Biomass

In the draft REDIII, the term “forest biomass” was used, while the approved text sees the less familiar term “primary woody biomass (PWB)”. The term contrasts with “secondary woody biomass”, which refers to processing residues, such as sawdust and other by-products of sawmills. REDIII defines the term as:

(47ab) 'primary woody biomass' means all roundwood felled or otherwise harvested and removed. It comprises all wood obtained from removals, i.e., the quantities removed from forests, including wood recovered due to natural mortality and from felling and logging. It includes all wood removed with or without bark, including wood removed in its round form, or split, roughly squared or in other forms, e.g., branches, roots, stumps and burls (where these are harvested) and wood that is roughly shaped or pointed. This does not include woody biomass obtained from sustainable wildfire prevention measures in high-risk fire prone areas, woody biomass obtained from road safety measures, and woody biomass extracted from forests affected by natural disasters, active pests or diseases to prevent their spread, whilst minimising wood extraction and protecting biodiversity, resulting in more diverse and resilient forests, and shall be based on guidelines from the Commission [Am. 42];

The original REDIII proposal intended for the use of roundwood or logs which could be utilized for other uses, such as construction or furniture, to be restricted, as well as the cascading principle needing to be employed. On the other hand, there were no apparent discussions on restricting logging residues, including branches, tops, and foliage, which account for a major part of forest biomass due to their difficulty for material use.

On the contrary, logging residues were scientifically evaluated as one of the promising measures to realize a climate benefit. For instance, a synthetic report published by the EU Joint Research Center (JRC report) in 2021 summarized that fine woody debris (slash and foliage or needles) within the ecological threshold can be considered as one of the win-win solutions from which we could anticipate benefit from both climate mitigation and biodiversity conservation. 

Nevertheless, it was surprising to see that the EU may begin to restrict the use of PWB, including residues, within the current level, but it can be interpreted that the Parliament thought that harvesting residues have reached the ecological threshold. Indeed, the wood production capacity of European forests has been well utilized. As one indicator, the estimated ratio of harvesting volume against incremental volume showed a steady increase from 2009, reaching 85.2% in 2015. 

Moreover, the JRC report estimated that about 50% of woody bioenergy consumption in the EU in 2015 was secondary woody biomass, with PWB providing 37%, and 14% being of unknown origin. It goes on to report that 53% of PWB (19.6% of total woody biomass) was harvesting residues, and the remaining 47% was log shaped (17.4% of total). However, it should be noted that at least half of all roundwood came from coppice forests in Mediterranean Europe. Moreover, a certain amount of wood with a roundwood shape collected after salvage logging for storms, wildfires, and insect attacks, was burned, and its energy was recovered. Other low-quality logs, such as thinned wood and curved ones, might have been used for fuel. 

Nevertheless, there was a growing suspicion that high-value logs have been used for fuel, which leads to increasing volumes of harvested forest, with images showing a huge amount of stemwood stacked at power plants and pellet mills.²

Stopping subsidies for forest biomass power only production

Another critical point with REDIII would be that it requires member states to stop providing subsidies for plants that produce only electricity (not cogeneration) after December 2026 in principle. The original draft proposed an exemption for power plants operating in regions falling under a Territorial Just Transition Plan or plants of BECCS (Biomass CO2 Capture and Storage). In addition, plants in which modifications towards cogeneration are not possible due to the absence of infrastructure and demand conditions will be exempt from this rule.

The bioenergy industry strongly opposes this amendment that only forest biomass cannot receive public support among other renewables although it is recognized as being a renewable source of energy.³ However, bioenergy may be chosen even without subsidies due to the recent spikes in prices of fossil fuels and higher prices of emitted carbon. Since March 2022, the price of coal in Europe has seen historic highs of above 400 EURO/t. Indeed, the price of woody biomass has also seen increases, albeit still falling below that of coal, at over 300 EURO/t. However, considering the recent high price of EU-ETS with 80 EURO/t-CO2, coal prices can expect to see further increases of 190 EURO/t , which implies that wood pellets may have economic competitiveness even without subsidies.

EU attempts to use forest biomass more effectively; Japan needs to keep a close watch

The discussion on forest biomass in the EU includes important implications, which calls for an integrated review of energy and forest policy in Japan. For this reason, the discussion in the EU should be watched carefully until the amendment text is finalized, while considering the following points.

Firstly, the EU doesn’t reject bioenergy use itself but is trying to use it more effectively. As previously noted, bioenergy accounts for 60% of renewable energy in the EU, with 20% coming from forest biomass. Furthermore, it is anticipated that the consumption of bioenergy will double  by 2050 in the analysis conducted for FiT for 55.⁴ Moreover, REPower EU, which was revealed in May 2022 after the Russian invasion of Ukraine, plans to increase biomethane production to 17 billion m3 gas equivalent, considering the deployment of energy crops.

Secondary woody biomass, such as process residues from sawmills, will continue to be promoted among woody biomass. Seeing the boom of wooden buildings in Europe, including high-rise wooden structures, it can be expected that more secondary biomass will be available due to the demand for sawn wood products. Also, it can be interpreted that PWB use options of significance for EU's decarbonization, such as energy production with higher efficiency (i.e., cogeneration), or Just Transition Plan in coal mining regions, and BECCS realizing negative emissions are clearly still considered as effective measures.

It should also be noted that more and more woody biomass, like split-log, chips, and pellets, is used for residential heat production as a substitute for natural gas from Russia, while RED regulates large-scale commercial plants. Thus, MEP Markus Pieper, who was the reporter to submit the amended REDIII to the parliament, said that “We do need wood-based biomass as a source of energy if we  genuinely are to undertake this energy transition”. 

Secondly, this is needed to be examined together with the EU's New Forest Strategy for 2030, which was also voted on at the plenary. The UK, which is the largest wood pellet importer, has already left the EU. Biomass imports from Russia and Belarus are banned, and it is obvious that the main topic of the discussion is how to optimize forest use in the EU while ensuring environmental benefits. 

As previously noted, it is not easy to increase the amount of harvesting as the forest utilization ratio in the EU is high, with the harvesting of 70 to 80 % biomass growth. Thus, the new Forest Strategy aims to improve the quantity and quality of EU forests by increasing forest coverage and improving the resilience of forests. We can also see a move to seek other revenue streams outside of timber production, for example examining the creation of payment schemes for ecosystem services.

On the other hand, as only one-third of Japanese forest growth has been utilized and less than 30% of logging residues are extracted, policy has been dedicated to promoting domestic wood supply and utilization, including thinned wood. It should be noted that unutilized thinned wood has been specifically promoted under the FiT scheme because thinning is considered as an imperative management practice to keep the forest in a healthy condition. 

Thirdly, it is revealing to see some considerations being made to balance the current situation. Some exemptions have been prepared for the phasing out of electricity-only plants using forest biomass. In addition, the GHG reduction requirement was relaxed: the retrospective proposal of the first draft that all plants that started operation before 2025 should be eligible was changed so that only plants coming online after 2021 are subject to the GHG regulations. Moreover, the scale subject to the rule was mitigated from the originally proposed 5MW to 7.5MW. These thoughts are informative for the current discussion on developing GHG regulations in Japan.

<Related Links>
[Statistics Explains] Solid Biomass Consumption in Japan (October 2021)
[Position Paper] Sustainability of Wood Bioenergy in Japan: Implementation of System for Ensuring GHG Reduction (September 2020)