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This policy brief, based on a NORD-STAR working paper, examines how bioenergy market development may affect different actors’ ability to adapt to a changing climate – and how climate change itself may affect bioenergy markets.
Bioenergy markets have expanded rapidly in the last decade, both in volume and in geographic scope, and global commodity markets are emerging for wood pellets and bioethanol in particular. In the European Union, bioenergy is already the most important renewable energy source, and by 2020, its share of the energy mix is expected to more than double from 2005 levels, to 12%.
Bioenergy is a key component of climate change mitigation policies in the Nordic region, particularly in Denmark, Finland and Sweden. Bioenergy use in all three countries relies on extensive trade, primarily within Northern Europe and the Baltic Sea Region, but also with other European countries, the U.S., Canada and Brazil. Given that bioenergy crop production and forestry are expected to be affected by climate change, it is crucial to be aware of potential risks and prepare for them.
Policy-makers can help increase the resilience and sustainability of bioenergy use by diversifying their supply to reduce their exposure to climate risks in any one region – which would also ease pressures on suppliers when scarce resources are needed locally. As warmer winters reduce energy demand in the Nordic region, the biomass freed up could be exported or used in industry.
Download the policy brief (PDF, 1.1MB)
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