Electrification in China’s industrial sector has rapidly transitioned toward low-carbonization in recent years with the ascent of photovoltaics, energy storage, wind power, and microgrids. However, decarbonization of industrial heating has progressed comparatively slower.
Industrial heating constitutes the cornerstone of energy consumption in China’s industrial sector, making it the world’s largest heating market. According to data from the National Bureau of Statistics of China, domestic industrial heating consumption reached 1.82 billion tons of standard coal in 2021, accounting for 59.75% of total energy consumption in the industry. This figure is significantly higher than the proportion of industrial electricity consumption (40.25%).
Industrial heating primarily involves industrial steam preparation, achieved by heating water above its boiling point to produce steam. Most of China’s industries, including manufacturing, petrochemicals, food and pharmaceuticals, papermaking, and textiles, necessitate large amounts of industrial steam.
Currently, most industrial enterprises in China still rely on coal and natural gas as fuel for heating and steam supply. Although the latter is a clean energy source, it is not low-carbon. Under China’s dual-carbon targets, these heating methods face immense pressure to reduce carbon emissions. Therefore, the imperative for the green and low-carbon transformation of heating systems is evident.
Against this backdrop, biomass energy, characterized by close to zero carbon emissions, emerges as an effective option for industrial decarbonization, prompting more industrial enterprises and parks to adopt biomass heating.
Hong Hao, vice chairman of the World Bioenergy Association (WBA) and vice president of the All-China Federation of Industry and Commerce (ACFIC), told 36Kr that the biomass heating industry in China has matured and aligned with international standards. Notable case studies in Jilin, Shandong, Hebei, Hubei, and Guangdong, among other locations, have gained recognition among both domestic and foreign state-owned enterprises.
In December 2023, Beijing issued a report outlining its perspective on implementations to promote the development of new energy heating. The country aims to encourage the application of new energy heating technologies, including the utilization of biomass, across various scenarios.
The market reception of biomass heating has been bolstered not only by domestic policies but also by its low-carbon nature. CO2 released during biomass combustion is roughly equivalent to the CO2 absorbed during its growth through photosynthesis, resulting in nearly zero carbon emissions attributable to biomass heating. Only a small amount of carbon is emitted during transportation and processing. Consequently, replacing fossil fuels with biomass as an energy source has become a major trend in overseas markets, according to 36Kr.
Public data reveals that biomass heating currently constitutes 86.6% of renewable energy heating in the European Union. In 2018, the EU reduced 296 million tons of carbon dioxide emissions through the development of its biomass heating capabilities, accounting for nearly 10% of the EU’s total emissions.
In terms of cost, biomass heating offers certain economic advantages compared to coal heating. According to Hong, biomass fuel prices are slightly higher than coal prices but lower than natural gas prices. Simultaneously, biomass is the only renewable fuel among the three options, emitting minimal CO2, with pollutant emissions meeting natural gas standards, thereby achieving both economic and carbon reduction benefits.
In cities where energy consumption control is stringent, centralized heating is vital for industrial parks. Securing approval for new coal-fired power projects is challenging, while high natural gas prices render it increasingly unaffordable. Hence, biomass heating emerges as the next best option.
Zeng Shaojun, secretary-general of the ACFIC, told 36Kr that substituting natural gas for coal alone won’t suffice in solving the problem of carbon emissions. According to Zeng, industrial parks in southern China have approached the organization seeking solutions, aiming to address their heating issues through biomass utilization.
It’s worth noting that biomass heating and biomass power generation constitute two distinct businesses. Biomass power generation projects are not universally economically viable yet and still rely on government subsidies for survival, whereas biomass heating projects have already achieved economic viability and can operate profitably without government subsidies.
For a long time, biomass energy has not occupied a prominent position in China’s energy structure, owing to various reasons, including a lack of public awareness and acceptance. Many believe that direct combustion of biomass can cause significant pollution.
According to Shi Yuanchun, an academician of the Chinese Academy of Sciences and the Chinese Academy of Engineering, and former president of the China Agricultural University, public misconceptions about the biomass industry persist in China due to insufficient understanding. Efforts are needed to foster a consensus between industry and society.
Du Xiangwan, academician of the Chinese Academy of Engineering and former vice president of the institution, also advocated for enhancing the strategic position of biomass in China’s energy transformation. Du highlighted the economic, climate, social, and environmental benefits of leveraging biomass energy, suggesting that it should be elevated to the same status as wind, solar, and geothermal energy in energy-related development strategies.
According to data from the International Energy Agency (IEA), biomass energy is the world’s largest renewable energy source, accounting for as much as 50%. This figure is equivalent to the sum of other renewable energy sources, including wind, solar, geothermal, and hydro. Paolo Frank, director of the IEA’s renewable energy division, described modern biomass energy as an “overlooked giant.”
In the EU, biomass energy reportedly constitutes as much as 65% of the region’s renewable energy structure, contributing 43% to carbon emission reduction, ranking first by proportion.
There remains tremendous untapped potential for the development of China’s biomass energy industry. Reasonably and fully utilizing biomass energy will be crucial for China to reduce fossil energy consumption, improve energy utilization structure, and decrease greenhouse gas emissions.
Concerning the low-carbon transformation of industrial heating, with the introduction of EU carbon tariffs and the dual control system governing carbon emissions in China’s key industries, pressure to reduce carbon emissions in the industrial sector has surged. Consequently, the demand for low-carbon industrial heating is rapidly increasing. Biomass heating presents new development opportunities and is anticipated to undergo faster development, playing an increasingly significant role in industrial energy supply.
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This article was written by Wang Fangyu for 36Kr.