Financial downturn at Enviva could mean trouble for biomass energy

By Justin Catanoso
Mongabay
May 25, 2023
Category: Carbon, Climate & Bioenergy
Region: United States

Enviva harvests trees to manufacture millions of tons of wood pellets annually in the U.S. Southeast to supply the biomass energy demands of nations in the EU, U.K., Japan and South Korea. But a host of operational, legal and public relations problems have led to greater-than-expected revenue losses and a drastic fall in stock price. These concerns raise questions as to whether Enviva can double its projected pellet production from 6 million metric tons annually today to 13 million metric tons by 2027 to meet its contract obligations. Enviva says its problems pose only short-term setbacks. While it isn’t possible to connect Enviva’s stock decline, or the company’s downgrading by a top credit ratings agency, with any specific cause, some analysts say that investors may be getting educated as to the financial risk they could face if the EU or other large-scale biomass users eliminate their subsidies to the industry.

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