Tax credits will help the industry compete more effectively with other renewable energy sources
New York, NY (PRWEB) October 18, 2014
The Biomass Power industry has grown at a healthy rate in the five years to 2014. The industry's expansion has been propelled in part by several federal renewable energy tax credits that encouraged the use of biomass power. Furthermore, the majority of states have enacted renewable portfolio standards (RPSs), which require local utilities to generate electricity from renewable power as a percentage of their total energy portfolio. Increased campaigning for green technology also influenced industry performance by sparking interest in technologies that replace pollutant-generating energy sources, such as coal and gas. As a result of these trends, industry revenue is expected to increase at an annualized rate over the five years to 2014.
According to IBISWorld Industry Analyst Lucas Isakowitz, “The increase in biomass energy projects during the past five years reflects a triumph for government assistance in the industry, as biomass normally meets difficulty competing against traditional energy-generation commodities, such as natural gas and oil.” The assistance, provided in the form of federal tax credits and RPSs, boosted biomass-electricity generation. However, federal production tax credits for biomass power expired at the end of 2013 and have not be reinstated. Furthermore, many states have found that emissions from biomass power generation actually exceed those of coal power generation, which will likely diminish RPSs that directly benefit biomass power over the next five years. Reduced government assistance poses a serious threat to the growing industry.
Nevertheless, the continued existence of RPSs, as well as new biomass energy technology, is expected to continue allowing industry players to compete with other energy-generation technologies in the next five years. “Additionally, the continued economic recovery over the next five years will spur growth in manufacturing and industrial production sectors, increasing the level of electricity consumption and translating to higher demand for biomass power,” says Isakowitz. Given these conditions, industry revenue is forecast to increase at an annualized rate over the next five years.
For more information, visit IBISWorld’s Biomass Power in the US industry report page.
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IBISWorld industry Report Key Topics
Enterprises in this industry operate electricity-generating facilities using biomass (e.g. agricultural byproducts, landfill gas and biogenic municipal waste). Establishments primarily engaged in operating trash disposal incinerators that also generate electricity are classified in the Waste Treatment and Disposal Services industry (IBISWorld 56221).
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