Bioenergy to Denmark

(Last updated: 16 Dec 2008)

Trends and opportunities

The market

Biofuels for transport

After rapid expansion the past few years biofuels had slower growth in 2007 due to higher cereal costs. There has also been recent debate on to what extent ethanol production reduces CO² emissions and if the rise in food prices is caused by the use of ethanol for fuel. There was still growth in the sector – Spain, for example, more than doubled it’s biofuel consumption in 2007.

Major biofuel markets in Europe (tonnes of oil)
Country	Bioethanol	Biodiesel	Other	Total
Germany	293,078	2,957,463	752,207	4,002,748
France	272,937	1,161,277	0	1,434,215
Austria	21,883	367,140	0	389,023
Spain	112,640	260,580	0	373,220
UK	78,030	270,660	0	348,690
Sweden	181,649	99,602	0	281,251

Wood pellet industry

The wood pellet market in Europe is growing rapidly. In 2006, consumption was estimated at just under five million tonnes and is expected to grow to over 12 million tonnes by 2010. Currently the fastest growing sector is home heating, although there is also a strong demand for wood pellets for power stations.

Sweden is the largest market for pellets though Denmark and the Netherlands are the largest current importers in the world. The increased demand and higher prices for wood pellets has meant that import of pellets from overseas is currently feasible.

Major pellet markets in Europe (tonnes of pellets)
Country	Production	Consumption
Sweden	1,400,000	1,700,000
Austria	600,000	400,000
Germany	500,000	500,000
Denmark	200,000	950,000
Netherlands	100,000	1,500,000

Second generation biofuels

Europe is developing a range of technologies to improve the cost-effectiveness of bio-fuels particularly focused on decreasing costs of ethanol and bio-diesel production.

Research and investment

There are opportunities for research and collaboration, particularly with the development of second generation biofuels. The number of research and demonstration projects on wood, cereals, straw, animal waste and waste from food producing industries as input to the energy sector, is on the rise.

Opportunities

Pellet manufacture – the strong demand for wood pellets for energy has increased prices so that the export of wood pellets from Australia is currently viable.

Bio fuel production – Europe is an early adopter of new bio-energy technologies. Export is likely through licensing of technology or the establishment of local production facilities.

(Source: State of Renewable Energies in Europe, 7ed. Report - EurObserv'ER 2007)

Marketing your products and services

Market entry

Western Europe is a complex and competitive environment with many local competitors. Australian suppliers should consider the following:

• European companies are rather conservative when purchasing product and service and often reluctant to buy from companies with no proven track record or in-country support.
• Many companies plan to establish a direct presence in Europe. This can be important commercially, as it is seen as a sign of commitment to the market. The use of case studies involving internationally recognised organisations helps to increase confidence and demonstrate the relevance of the product.
• Commitment to support and long-term presence in the market must be demonstrated. In many cases this will include establishing a direct presence or strategic alliance in Western Europe. European companies prefer to have local support rather than online support from other countries. 
• There are several specialist trade shows in Western Europe. This is good way to get an understanding of the market and to benchmark your own products/technologies by exhibiting at a trade show or at least visiting the main fairs. Upcoming trade shows include:
  
  • 
    World Bioenergy & Clean Energy and Fuels – Stockholm, Sweden 14-18 September 2009
    Once off event ‘special edition’ to capitalise on the Copenhagen Climate Conference
    
    
  • Inter Pellets – Stuttgart, Germany, October 2009
    Europe’s largest pellet trade event.
    
    
  • World Bioenergy – Jonkoping, Sweden, 25-27 May 2010
    Leading international trade fair for the bio-fuel sector

A first approach should clearly state the benefits of the technology to the customer in terms of cost reduction, efficiency and/or return on investment. Approaches should be tailored for each company or sector and ideally in the local language.

Distribution channels

Distribution channels in the Europe are highly developed, and the most effective route to the market depends on the product in question.

Tariffs, regulations and customs

The European Union has a harmonised trade system. Common Customs Tariff (CCT) is applicable to goods from non-EU countries, including Australia.  Most duties are ad valorem (%), based on the GATT Valuation Code (approximate CIF value).

Before shipping any goods to Europe, you should obtain a written customs duty ruling from the local customs service. These rulings are called Binding Tariff Information (BTI).  Getting a BTI is free and will prevent any conflict over customs or excise duty.

EU regulation, including quality assurance and industry standards is quite comprehensive and complex. Industry standards will vary depending on the product/service offered.

Links and industry contacts

Biofuel-related resources

Europe’s Energy Portal – www.energy.eu
European Bio Energy Association – www.aebiom.org

Contact details

The Australian Trade Commission (Austrade) is the Australian Government’s trade and investment development agency, operating as a statutory agency within the Foreign Affairs and Trade portfolio.

Austrade assists Australian businesses contribute to national prosperity by succeeding in trade and investment, internationally, and promoting and supporting productive foreign investment into Australia.

Austrade:

• Delivers services that assist Australian businesses initiate, sustain and grow trade and outward investment.
• Promotes Australia as an inward investment destination and, with the States and Territories, supports the inflow of productive foreign direct investment.
• Administers the Export Market Development Grants scheme.
• Undertakes initiatives designed to improve community awareness of, and commitment to, international trade and investment.
• Provides advice to the Australian Government on its trade and investment development activities.
• Delivers consular, passport and other government services in designated overseas locations.

A list of Austrade offices (in alphabetical order of country) is available.

More information

For further information please contact Austrade on 13 28 78 or email info@austrade.gov.au