Every energy conversion system wastes a portion of its input energy. For biomass to electricity conversion systems, 50% or more of the energy input can be lost – even up to 90% for some small-scale and alternative technologies. However, the energy rejected from a conversion system can often be used productively for industrial or residential heating purposes in place of burning fuels separately for that purpose. When this is done the overall efficiency can jump to 75-80%. Most systems must reduce their electricity production somewhat to make cogeneration feasible.
Thermal applications are the most efficient conversion technology for turning woody biomass into energy and should be considered in the development of a national Renewable Portfolio Standard (RPS). Thermal applications for woody biomass can be up to 90% efficient, compared to 20% for electricity and 50-70% for bio-fuels. Thermal systems can be applied at multiple scales, and are often more economically viable, particularly in rural and remote areas, than electrical generation.
By not including thermal energy, one of the most efficient uses of woody biomass energy is put at a disadvantage to generating electricity and processing liquid bio-fuels. This runs counter to the goals of displacing fossil fuels, promoting energy efficiency, and minimizing carbon emissions.