Market analysis wood pellets in Germany

To give a clear overview of the possibilities in the wood pellet market is a SWOT-Analysis used. This analysis presents the Strengths, Weaknesses, Opportunities and Threats of the wood pellet market in general (not for a specific company!).

Confrontation-matrix

In this matrix are the benefits and the issues around the wood pellet market displayed against each other. This gives a clear overview and a good summery as well about the `Wood Pellets´ market! Strengths

1) Sustainable
2) Renewable
3) Worldwide available
4 ) New and higher employment
5 ) Accessibility. Germany is located in the center of Europe, which is a strength point and offers good possibilities for trading. Germany is very good accessible by water, via seas and channels due to the Netherlands as well.

Weaknesses

1) High competition against other energy resources.
2) The technology around the production of bioenergy needs more and new inputs to win more energy and make it more favorable and get higher outputs. 3) High investment costs in the beginning, to install a combustion furnace at home or in the industry.

Opportunities

A)Wood fuels provides opportunities for new companies to develop B) Producing and the using of wood fuels locally will minimize transport costs C) Wood fuels releases lower quantities of atmospheric pollutants D) It is possible to offset the carbon emissions from burning against the carbon uptake of the trees during the growth of the wood. E) According to the EU´s policy and the Kyoto-protocol, wood fuels fits very well with the targets

3,4,5 -> A
The wood pellet industry offers a great opportunity to develop new companies, and for new and more extensive employment. This counts for all places in the world because wood pellets can produce almost everywhere. For Europe(Germany) it is an great opportunity in special because of the current economic recession and a lack of jobs. 1,2 -> B,C,D,E

The sustainability and renewability of wood pellets fits well with all the European targets due to the Kyoto-protocol. Wood fuels releases lower quantities of atmospheric pollutants compared to fossil fuels. And wood resources are almost all over the world accessible.

1,2 -> A,E
New technologies are necessary to make wood pellets more profitable compared to other energy resources. But it is a challange for companies to develop in new technologies, which is good for the energy market, employment, and most important the environment!

3 -> E

Because of the high investment costs in the beginning for installing a heating system, many people and/or companies choose for other (cheaper) opportunities. But according to the increasing environment issues, it is for the European Union an option to subsidy and promote wood pellet energy.

Threats

A) Extensive market with lots of competition, there are many different energy resources available. B) To create bioenergy/wood pellets, lots of energy is necessary for the production.
1,2 -> A, B

Sustainability and renewability are increasingly more important because of the global warming and environment issues. This offers a good opportunity for bioenergy. The use of wood pellets could be more and more interesting instead of fossil fuels.

1,2,3 -> A,B
According to the disadvantages of bioenergy, there are new technologies needed in energy market to make bioenergy more profitable compared to fossil fuels.