The German government has now published a forecast that wood pellet fuel will be the cheapest compared to all other energy sources such as biomethane, district heating, natural gas and heat pumps for the next 12 years.

BMWK energy price forecast for new heating law - Government sees wood pellets as cheapest fuel in future.

The German government has now published a forecast of the costs of various energy sources for the next 12 years. Over this period, wood pellets, with an average price of 8.58 cents/kilowatt hour (kWh), come off by far the cheapest compared to all other energy sources listed, such as biomethane, district heating, natural gas and heat pumps.

"For the domestic energy source, which is produced on the basis of a widely available domestic residual wood volume, the result is not surprising," emphasises DEPV Managing Director Martin Bentele. "Even though the price of pellets rose sharply in the short term due to the energy price distortions caused by the war of aggression on Ukraine last year, it generally remains subject only to slight seasonal price fluctuations, which are mostly influenced by the construction industry. As a climate-friendly fuel, however, it is independent of CO2 prices and free of speculative influences," says Diplom-Forst-wirt Bentele.

For years, Germany has been the European leader in pellet production and a regular net exporter. In the previous year, around 3.6 million tonnes (t) were produced. The climate-induced need for forest conversion towards more mixed stands in the coming decades will lead to a continued high supply of residual wood as the basis for pellet production. "The German government has confirmed this with its statements on the reliability of the pellet price until 2035," concludes Bentele.

Statements by the Federal Ministry for Economic Affairs and Climate Protection (BMWK):

The assumptions on energy prices used in the economic efficiency calculations and for the presentation of the compliance costs are based on extensive modelling of the energy system and include possible developments of CO2 prices as well as grid charges and other levies and charges.

The underlying assumptions on the costs of energy sources are coherent with the assumptions of the BMWK long-term studies. The underlying CO2 prices also correspond to the assumptions from the BMWK long-term scenarios.

Statements by the Federal Ministry for Economic Affairs and Climate Protection (BMWK):

The assumptions on energy prices used in the economic efficiency calculations and for the presentation of the compliance costs are based on extensive modelling of the energy system and include possible developments of CO2 prices as well as grid charges and other levies and charges.

The underlying assumptions on the costs of energy sources are coherent with the assumptions of the BMWK long-term studies. The underlying CO2 prices also correspond to the assumptions from the BMWK long-term scenarios.


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Source: proplanta.de