Biomass is regularly included in lists of green or renewable energy sources; We believe that this displays a lack of understanding about the carbon intensity of our energy systems. In practice, biomass powerplants not only do not have lower carbon emissions than fossil fuel powerplants but are often responsible for producing more. This is not to say that we are not in favor of policies that would reduce global carbon emissions, but allowing uninformed climate change ideologues to produce our energy policy will inevitably cause more harm than good.

What is Biomass?

In the context of energy production, biomass refers to the burning of plant matter to produce energy. While there are numerous ways to produce energy from biomass, including chemical and thermochemical conversion — which turns the biomass into liquid fuel (ethanol) — the most common means for grid-scale power generation using biomass is through direct combustion (burning it). Most biomass for direct combustion takes the form of wood chips (or pellets), but theoretically, any kind of plant matter could be used. These wood pellets are then either burned in modified power plants that previously burned coal or co-fired with coal. In 2022 biomass accounted for about 5% of the total energy production in the United States (this does not include ethanol used as an additive to gasoline).

The energy density of biomass is considerably less than that of fossil fuels.

In comparison to fossil fuels, one has to burn a lot more biomass to produce the same amount of energy. The problem for biomass starts with emissions; burning a kilogram of biomass produces only a little less carbon dioxide (CO2) than burning a kilogram of coal. However, because of the energy density difference, one needs to burn substantially more biomass relative to coal to generate the same amount of energy. It’s because of this that biomass powerplants emit 150% of the carbon dioxide (CO2) produced by coal-burning powerplants and between 300%-400% produced by natural gas plants.

The History of Biomass

Biomass was the first energy source that humans used, and it has been the primary energy source for most of human history, up until the Industrial Revolution in the mid-1800s, when humanity realized the incredible potential of coal. While the industrialized world adopted coal and later oil and natural gas for energy production, the poorest regions have continued to burn biomass for most of their energy needs (cooking fuel and lighting). This article doesn’t look to cover the over 2 billion people who use biomass as their only energy source, since that is simply a matter of poverty and access; if you provided them with a superior energy source, they would happily adopt it.

Enter the environmentalist movement: developed industrialized nations began to realize that the unabated burning of fossil fuels possibly had something to do with all this air pollution. Biomass was marketed by well-meaning but woefully misinformed people who wanted to reduce carbon emissions. Their reasoning seemed to amount to no more than “How could burning trees be worse for the environment than fossil fuels?” (Sadly, it turned out it was significantly worse).

Second Order Impacts

Many arguments in favor of using biomass for energy generation argue that the trees that go into making the wood pellets are renewable; while this is technically true, by similar logic, one could also argue that fossil fuels are renewable sources as long as your time scale is measured in millions of years. While forests will be able to regrow within a lifetime, cutting down forests for fuel has more significant second-order impacts.

While many proponents of using biomass for grid-scale energy production would argue that environmentally sound forestry practices (not cutting down old-growth forests or only cutting down diseased trees) can be used to cultivate trees for biomass, the reality is different. Most biomass wood pellets are produced by environmentally harmful practices (such as clear-cutting); the fact is that if one is producing biomass on a small scale, sustainable forestry practices can be used to great effect; on an industrial scale (necessary for grid-scale energy production), the demand for biomass far exceeds the supply of sustainably sourced trees. Forests also play an important role as carbon sinks, absorbing CO2 from the atmosphere; in one year, a tree can absorb 48 pounds of CO2 from the atmosphere. Humanity already has a deforestation problem, with forests being cleared for use as cattle farms; there is really no need to exacerbate this trend for the sake of electricity production.


So, we are burning trees to produce energy with a similar or worse carbon intensity to that of fossil fuels, the only difference being that the forests we cut down to produce our biomass actually would provide benefit environmental benefits for years to come if left alive, and by comparison, leaving fossil fuels in the ground would provide humanity no similar benefit.

It is mind-boggling how well-meaning environmentalists have endorsed an energy source that is so obviously harmful to the environment in almost every conceivable way. It displays that climate change has become so ideological and adversarial that no one is actually trying to provide any achievable path to addressing it. Environmentalists have villainized fossil fuels to such a degree that they cannot admit to themselves that their lifestyles would be impossible without them, and the conservatives that disregard the threat of climate change are not willing to admit that while fossil fuels have been an incredible resource responsible for unimaginable increases in our quality of life, there is a real need to reduce our carbon emission with less polluting energy sources. Our advice is to let some more engineers into the policy discussion; they’ll be able to draft achievable climate policy without ideological bias towards a particular energy source.


Opinions expressed herein by the author are not an investment or vote recommendation and are not meant to be relied upon in investment or voting decisions. The author is not acting in an investment adviser capacity. This is not an investment research report. The author's opinions expressed herein address only select aspects of potential investment in securities of the companies mentioned and cannot be a substitute for comprehensive investment analysis. Any analysis presented herein is illustrative in nature, limited in scope, based on an incomplete set of information, and has limitations to its accuracy. The author recommends that potential and existing investors conduct thorough investment research of their own, including detailed review of the companies' SEC or CSA filings, and consult a qualified investment adviser. The information upon which this material is based was obtained from sources believed to be reliable but have not been independently verified. Therefore, the author cannot guarantee its accuracy. Any opinions or estimates constitute the author's best judgment as of the date of publication and are subject to change without notice. Funds the author advises may own shares in the securities discussed and may buy or sell shares without any further notice. This is not a solicitation or recommendation to vote for or against the transaction discussed. The note does not constitute an offer to sell, or a solicitation of an offer to purchase, any securities. Any such offer or solicitation will be made in accordance with applicable securities laws. The note is being provided on a confidential basis solely to those persons to whom this quarterly note may be lawfully provided. It is not to be reproduced or distributed to any other persons (other than professional advisors of the persons receiving these materials). It is intended solely for the use of the persons to whom it has been delivered and may not be used for any other purpose. Any reproduction of the quarterly note in whole or in part, or the disclosure of its contents, without the express prior consent of Berman Capital Group LLC (the “Company”) is prohibited. No representation or warranty (express or implied) is made or can be given with respect to the accuracy or completeness of the information in the quarterly note. Certain information in the monthly note constitutes “forward-looking statements” about potential future results. Those results may not be achieved, due to implementation lag, other timing factors, portfolio management decision-making, economic or market conditions or other unanticipated factors. Nothing contained herein shall be relied upon as a promise or representation whether as to past or future performance or otherwise. The views, opinions, and assumptions expressed in this note are subject to change without notice, may not come to pass and do not represent a recommendation or offer of any particular security, strategy or investment. The note does not purport to contain all of the information that may be required to evaluate the matters discussed therein. It is not intended to be a risk disclosure document. Further, the note is not intended to provide recommendations, and should not be relied upon for tax, accounting, legal or business advice. The persons to whom this document has been delivered are encouraged to ask questions of and receive answers from the general partner of the Company and to obtain any additional information they deem necessary concerning the matters described herein. None of the information contained herein has been filed or will be filed with the Securities and Exchange Commission, any regulator under any state securities laws or any other governmental or self-regulatory authority. No governmental authority has passed or will pass on the merits of this offering or the adequacy of this document. Any representation to the contrary is unlawful.

Download PDF

Subscribe to stay up to date with all our latest news

* indicates required
Popular posts