In response to climate change, many countries, especially in Europe, have turned to biomass as a source of renewable energy. Even though biomass power plants emit more CO2 per megawatt-hour than fossil-fired plants, burning biomass is often treated in regulations as having zero CO2 emissions due to assumptions about its origin – that it is ‘waste’ that would decompose anyway, or that it is derived from trees or plants that will grow back and resequester carbon.
While many biomass plants worldwide burn residues from sawmills and black liquor from the paper industry, lucrative renewable energy subsidies have driven an increase in new wood-burning power plants. Forest harvesting to meet this new fuel demand presents a direct threat to both forests and international climate goals, contravening the directive of a recent report by the Intergovernmental Panel on Climate Change (IPCC)1 that stresses we must significantly increase carbon “sinks” in order to limit dangerous climate change, in addition to dramatically reducing emission.
Biomass and Enviva Investor Due Diligence
On Wednesday, February 27, 2019, As You Sow and a group of 27 SRI institutions, investors, and advisors filed a petition with the Securities and Exchange Commission (SEC) requesting the SEC to issue guidance under regulation S-K regarding how companies should disclose information about emissions of greenhouse gases from manufacturing and use of biomass-based fuels and products.
On Monday, March 4, 2019, a coalition of plaintiffs composed of individuals and non-governmental organizations (NGOs) from different countries filed suit with the European General Court challenging the European Union (EU)’s treatment of forest biomass as a renewable fuel in the EU’s 2018 revised Renewable Energy Directive (RED II).