Bethesda, Md., United States:
Enviva Inc. (NYSE: EVA) (“Enviva,” “our,” “we,” or the “Company”) welcomes today’s news that the European Union’s trilogue negotiations concluded with an agreement on the Renewable Energy Directive III (“REDIII” or the “Directive”) and is pleased to hear that woody biomass will continue to be recognized as a renewable energy source in the EU.
Although the final text of the agreement has yet to be released publicly, the Company also understands that, encouragingly, the agreement does not impose restrictions on “primary woody biomass,” which will be counted as 100 percent renewable and zero-rated in the EU Emissions Trading System (EU ETS), provided sustainability criteria are fulfilled. As the world’s leading producer of sustainably sourced woody biomass, Enviva is confident that it will be able to meet all updated sustainability criteria, thereby enabling its customers to continue to make an important contribution to achieving global climate goals.
Today’s agreement is also expected to include: assurances that electricity-only plants already receiving subsidies will continue to do so, meaning Enviva’s existing off-take contracts are not expected to be impacted; continuing availability of financial support to electricity-only installations where Bioenergy Energy Carbon Capture and Storage (BECCS) is used (this is a pivotal technology for reaching Net Zero and a key focus for many of Europe’s power generators); and the availability of financial support for all other end uses of woody biomass, which should provide further tailwinds to Enviva’s continued growth in combined heat and power, hard-to-abate sectors, and biofuels.
“Today’s REDIII agreement is the last major step towards the end of an 18-month process that is now drawing to a favorable conclusion for the environment,” said Thomas Meth, President and CEO of Enviva. “While there will be some conjecture over the coming weeks, based on information that we have received thus far, I am fully confident that the final text will enable our business to continue to support the EU’s journey to Net Zero and will strengthen the platform for Enviva’s growth, especially in light of current high carbon prices. Reputable scientific organizations, including The Intergovernmental Panel on Climate Change (IPCC), show that bioenergy is integral to achieving global climate goals, and I am delighted to hear that this was acknowledged and reflected in the REDIII agreement,” concluded Meth.
Enviva anticipates that the agreed final text of the Directive will not be available for a number of weeks and looks forward to sharing further information with its stakeholders in due course. The next step is for this agreement to be formally endorsed by the Council and Parliament before entering into law.
