Bioenergy & biofuels

Bioenergy use falls into two main categories: “traditional” and “modern”. Traditional use refers to the combustion of biomass in such forms as wood, animal waste and traditional charcoal. Modern bioenergy technologies include liquid biofuels produced from bagasse and other plants; bio-refineries; biogas produced through anaerobic digestion of residues; wood pellet heating systems; and other technologies.

About three-quarters of the world’s renewable energy use involves bioenergy, with more than half of that consisting of traditional biomass use. According to IRENA's latest data, bioenergy power capacity reached 151 GW globally by 2024, representing about 4.4% of total renewable capacity. Unlike other renewable technologies that have seen significant cost reductions, bioenergy has faced upward cost pressure, with the global weighted-average levelised cost of electricity (LCOE) rising to USD 0.087/kWh in 2024, compared to USD 0.086/kWh in 2010, due to volatile feedstock and logistics costs.

Biomass has significant potential to boost energy supplies in populous nations with rising demand, such as Brazil, India and China. It can be directly burned for heating or power generation, or it can be converted into oil or gas substitutes. Liquid biofuels, a convenient renewable substitute for gasoline, are mostly used in the transport sector.

Brazil is the leader in liquid biofuels and has the largest fleet of flexible-fuel vehicles, which can run on bioethanol – an alcohol mostly made by the fermentation of carbohydrates in sugar or starch crops, such as corn, sugarcane or sweet sorghum.