The North East’s growing biomass sector has the potential to be contributing more than £70m a year to the regional economy by 2015, according to a new report.
The research, carried out by Northwoods as part of the region’s NEWHeat project and backed by One NorthEast and the Forestry Commission, suggests that in 7 years time and with continued strong support, the value of the sector could have increased by more than 70% from the current annual figure of just over £40m, and created more than 2,000 new jobs.
Exploring the potential of the emerging biomass industry, given the size of North East England’s rural areas, woodlands and forests, is part of the focus on new and renewable energy outlined in the Regional Economic Strategy.
The role of biomass in helping to reduce the carbon emissions emitted by burning fossil fuels is increasingly being recognised by central, regional and local government, private businesses and environmental groups, with many beginning to look to biomass for a cost-effective method of heating.
The report’s author and Project Director of Northwoods, David Clubb,said: “Whilst other renewables – particularly the wind industry – have undertaken studies to find out how much their sectors are worth to the UK economy, there has been very little research to demonstrate the great value to the UK from biomass.
“It is important that the value of the sector to the region is laid out in straightforward economic terms, in order that the right policy and strategy can be developed to support its continued growth.”
The research comes as a number of projects continue their work to support the growth of the sector. These include NEWHeat, which is funded by One NorthEast to build demand for wood-fuel heating technology from businesses. The UK’s first dedicated wood fuel expo, Ignition 09, will take place at The Sage Gateshead next year with support from One NorthEast and Rural Development Initiatives.
Recently, the Agency also approved the investment of £1.2m of EU and Defra funding from the Rural Development Programme for England, to help small land-based and forestry enterprises develop the infrastructure and skills they need to move into the biomass industry, build supply chains and meet demand as it continues to grow.
In addition, the Forestry Commission and Northwoods are working with the private forestry sector to increase the amount of wood it produces.
This research is thought to be the first of its kind in the UK, with no other region known to have explored the potential economic value of biomass in this way. It is already being used in the development of national policy.
One NorthEast’s Director for Business and Industry, Ian Williams, said: “This research shows how biomass is a young, growing market, as we move to a low-carbon economy and with organisations and consumers looking for alternative methods of heat and power as energy prices continue to rise.
“This research gives us, for the first time, a robust picture of the size of this potential opportunity, and will guide future planning to build the market and supply chains in the region, adding value across other processes and enabling businesses to build their skills and meet industry standards.
“At a time when finding ways to supplement income and move into new markets is particularly important for small businesses, biomass will provide opportunities for some – especially in rural areas.”
Brendan Callaghan, Forestry Commission Regional Director for North East England said: “The Forestry Commission welcomes the findings of this report and strongly supports One NorthEast’s recent investments to help grow the sector. The findings confirm what many in the forest industry have known for some time – that there is considerable potential to increase the use of wood fuel to help boost the economy and meet the region’s renewable energy targets. The North East already produces more wood from its forests and has a larger wood processing industry than any other part of England, and new local markets for wood fuel will provide a further boost to the economy in rural areas and help fund the sustainable management of woodlands.
“It is important the woodlands are managed to help maintain their environmental, social and economic values. As well as producing timber, managed woodlands provide both higher quality natural habitats and more enjoyable places to visit than woodlands that are not managed. New wood fuel markets have the potential to be a major source of funding for management in small and otherwise uneconomic woodlands. As the market and supply chain develops, we expect to see increasing quantities of wood fuel being traded and more woodlands being actively managed.”
The research also highlights:
That at least 4,000 tonnes of wood is already being harvested in the North East each year for use in small biomass boilers, with a value of around £220,000
That around 60,000 tonnes of wood is being harvested in the North East each year for use in large boilers, with a value of £1.2m each year
That investments in the small-to-medium scale biomass sector through projects such as NEWHeat are among those likely to provide the strongest economic drivers for future growth.
The full report can be viewed at http://www.ruraldevelopment.org.uk/files/rdi/BiomassValue_northeast_1.pdf
