PUBLISHER: Fortune Business Insights Pvt. Ltd. | PRODUCT CODE: 2127998
PUBLISHER: Fortune Business Insights Pvt. Ltd. | PRODUCT CODE: 2127998
The global biomass power generation market was valued at USD 101.96 billion in 2025 and is projected to grow from USD 105.80 billion in 2026 to USD 152.68 billion by 2034, registering a CAGR of 4.69% during the forecast period. Asia Pacific dominated the global market with a 39.15% market share in 2025, supported by rapid industrialization, abundant biomass resources, increasing energy demand, and favorable government policies promoting renewable energy.
Biomass power generation involves producing electricity from organic materials such as agricultural residues, forestry waste, municipal solid waste (MSW), and animal waste. These materials are converted into energy through combustion, gasification, anaerobic digestion, or other technologies. Biomass has become an important renewable energy source as governments worldwide focus on reducing greenhouse gas emissions, improving waste management, and strengthening energy security. According to the International Energy Agency (IEA), modern bioenergy currently represents nearly 55% of global renewable energy consumption, highlighting its growing importance in the global energy transition.
Market Size and Forecast
The biomass power generation market reached USD 101.96 billion in 2025 and is expected to increase to USD 105.80 billion in 2026. By 2034, the market is forecast to reach USD 152.68 billion, growing at a steady CAGR of 4.69% from 2026 to 2034.
Asia Pacific generated USD 39.92 billion in market revenue during 2025, maintaining its leadership position due to expanding renewable energy investments and large-scale biomass availability.
Market Drivers
One of the major growth drivers is the increasing global emphasis on waste-to-energy (WtE) projects and circular economy initiatives. Governments are encouraging the conversion of municipal solid waste into electricity to reduce landfill dependency while generating clean energy. Rapid urbanization and rising waste generation have accelerated investments in biomass-based power plants across Europe, Asia Pacific, and the Middle East.
Another important driver is the abundant availability of agricultural and forestry residues. Crop waste such as rice husks, bagasse, straw, wood chips, and sawdust provides a low-cost and sustainable feedstock for electricity generation. Countries including China, India, Brazil, and Canada continue to utilize these resources to improve rural income, reduce open-field burning, and strengthen renewable energy production.
Market Restraints
Despite its advantages, biomass power generation faces increasing competition from lower-cost renewable energy technologies such as solar photovoltaic systems and wind power. These alternatives offer lower electricity generation costs, shorter project development timelines, and reduced operating expenses.
In addition, biomass projects require continuous feedstock collection, transportation, storage, and processing, resulting in relatively higher operational costs. Many projects remain financially dependent on government incentives, renewable energy certificates, and carbon credit programs.
Market Opportunities
Industrial decarbonization through Combined Heat and Power (CHP) systems presents significant growth opportunities for the biomass power generation market. CHP technology enables simultaneous production of electricity and thermal energy from biomass, achieving energy efficiencies exceeding 80%.
Industries including pulp & paper, chemicals, food processing, and cement manufacturing are increasingly adopting biomass CHP systems to reduce fossil fuel consumption, lower carbon emissions, and achieve corporate sustainability goals.
Market Trends
A key trend shaping the market is growing government commitment toward climate action and carbon neutrality. Countries worldwide are introducing renewable portfolio standards, carbon pricing mechanisms, and bioenergy incentives to accelerate biomass power deployment.
In addition, biomass is increasingly integrated into long-term energy transition strategies due to its ability to provide stable, dispatchable renewable power while supporting efficient waste management and circular economy objectives.
Market Segmentation
Based on feedstock, Municipal Solid Waste (MSW) accounted for the largest market share, contributing 31.79% of global revenue due to expanding waste-to-energy infrastructure and rising urban waste generation. Meanwhile, agricultural residues are expected to be the fastest-growing feedstock segment and are projected to account for 31.71% of the market in 2026.
By technology, the combustion segment dominated the market with a 61.02% share in 2026, owing to its proven efficiency, scalability, and lower operational complexity. The gasification segment is expected to record the fastest growth due to its cleaner emissions and higher energy conversion efficiency.
Based on application, the residential segment accounted for the largest market share of 27.13% in 2026, while the commercial segment is anticipated to witness the fastest growth during the forecast period due to increasing adoption of biomass heating and power systems in commercial buildings.
Regional Analysis
Asia Pacific remained the largest regional market with USD 39.92 billion in 2025 and is projected to reach USD 41.60 billion in 2026. China, India, Japan, and Southeast Asian countries continue investing heavily in biomass projects to improve energy security and reduce dependence on fossil fuels.
Europe generated USD 34.77 billion in 2025 and is expected to reach USD 36.07 billion in 2026. Strict climate policies, renewable energy targets, and the European Union Renewable Energy Directive continue to support regional market expansion.
North America accounted for USD 14.26 billion in 2025 and is projected to reach USD 14.68 billion in 2026, driven by government incentives, decentralized renewable energy projects, and increasing landfill diversion initiatives.
Latin America generated USD 7.36 billion in 2025, supported by biomass cogeneration from sugarcane bagasse and agricultural residues, particularly in Brazil and Mexico.
The Middle East & Africa market reached USD 5.64 billion in 2025 and is projected to grow to USD 5.82 billion in 2026, driven by rural electrification projects and expanding waste-to-energy investments.
Competitive Landscape
The biomass power generation market is fragmented, with companies focusing on technological innovation, renewable energy expansion, strategic collaborations, and biomass project development. Major market participants continue investing in carbon capture technologies, biomass CHP systems, and sustainable power generation solutions to strengthen their market position.
Leading companies operating in the market include ENGIE, Xcel Energy Inc., ABB, Siemens, General Electric, Nexans, Schneider Electric, Orsted A/S, Drax Group, ACCIONA, EDF, and Vattenfall.
Recent Industry Developments
Conclusion
The global biomass power generation market is expected to maintain steady growth through 2034, supported by increasing renewable energy adoption, waste-to-energy initiatives, industrial decarbonization, and favorable government policies. Although competition from lower-cost renewable technologies and feedstock supply challenges remain, continuous investments in biomass CHP systems, advanced conversion technologies, and sustainable waste management will create long-term growth opportunities. Asia Pacific is expected to remain the leading regional market owing to its abundant biomass resources, rapid industrial development, and strong government support for clean energy.
Segmentation By Feedstock
By Technology
By Application
By Region