The American South has become a key energy source for Europe, which uses wood pellets from U.S. forests in its power plants.

The demand has created business for companies such as Enviva, the so-called pellet giant of the U.S., according to a report (pdf) from the Natural Resources Defense Council. Enviva has operations in Mississippi and Florida and more planned in South Carolina and North Carolina. Other industry leaders include Franklin Pellets, Wood Fuel Developers and Georgia Biomass, which operates the world’s largest pellet factory.

Pellet manufacturing is concentrated in eight states: Alabama, Florida, Georgia, Louisiana, Mississippi, North Carolina, South Carolina, and Virginia. “Wood pellet manufacturing in the region is expected to continue skyrocketing, with production estimates as high as 70 million metric tons by 2020,” the report states.

The United Kingdom, the Netherlands, and Belgium are the biggest importers of the pellets, which are used in place of coal to satisfy pollution standards in European power plants.

They have fueled a rapidly growing market for wood pellets. U.S. exports of this commodity totaled 1.6 million tons in 2012, but then doubled by the following year, to 3.2 million tons in 2013.

Although pellet makers claim their product is cleaner than coal, there’s some question about that. The European Union policy that allows pellets to stand in for coal is based on the assumption that biomass energy is carbon neutral because the wood burned to generate electricity is replaced by living trees that absorb carbon dioxide.

Although that is true, it happens only over many years. Burning biomass releases up to twice as much CO2 as coal and up to four times as natural gas, and it takes a long time for a new tree to absorb the carbon produced when the old tree is burned.

-Steve Straehley, Matt Bewig, Noel Brinkerhoff

To Learn More:

In the U.S. Southeast, Natural Forests are Being Felled to Send Fuel Overseas (Natural Resources Defense Council) (pdf)

Why are Georgia and North Carolina Selling their Forests to Create Energy in Europe and the UK? (by Matt Bewig, AllGov)