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An Overview of Bioenergy
Bioenergy refers to energy derived from biomass (plants and animals), a renewable resource. Biomass conversion typically generates energy in the form of fuels, electricity, or heat. Plants and animals cycle atmospheric carbon dioxide (CO2) through growth and decay (biogenic carbon cycle) over relatively short timeframes. Sustainable management and regrowth of biomass is key to maintaining renewability and carbon neutrality.
Bioenergy plays an important role in Canada’s energy system, diversifying energy sources and contributing to decarbonization efforts across transportation, heating, electricity generation, and industrial processes. In 2023, bioenergy accounted for around 6% of Canada’s total end-use energy—about 624 petajoules (PJ).
This section outlines the three main types of bioenergy used in Canada—liquid, gaseous, and solid—highlighting recent usage trends, production developments, and future capacity.
- Liquid Biofuels: These are biomass-derived liquid fuels that can be conventional fossil fuel alternatives, used primarily in transportation and some industrial processes. In Canada, the main types include ethanolFootnote 1, biodiesel, and renewable diesel. Ethanol and biodiesel are typically blended with gasoline and diesel (respectively) to reduce greenhouse gas emissions. Ethanol and biodiesel are chemically different from gasoline and diesel, whereas renewable diesel is chemically identical to diesel and can be used either for blending or on its own.
- Gaseous Biofuels: These are gases produced from the breakdown of biomass. Canada’s gaseous biofuels are mainly biogas (a mixture of methane and CO2)Footnote 2. Biogas can be upgraded to meet pipeline quality standards in the form of renewable natural gas (RNG). These gases are typically used for electricity generation, heating, as industrial fuel, or as vehicle fuel.
- Solid Biofuels: These are solid fuels derived from biomass, used primarily for heat and electricity production. Key sources in Canada include firewood, wood pellets, solids in pulping liquor, and wood residues. These fuels are commonly used in residential heating, industrial heating and cogeneration, and electricity generation.
Figure 1: Bioenergy Usage in Canada in 2023
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Source: Comprehensive Energy Use Database | Natural Resources Canada, Statistics Canada Tables 25-10-0084-01 and 25-10-0031-01, Canada’s official greenhouse gas inventory, and Canadian Bioheat Database
Data: Bioenergy Usage in Canada in 2023 [XLSX 17 KB]
Text Alternative: This pie chart shows the shares and amount, in petajoules, of bioenergy usage by type in Canada in 2023. Solid biofuels represent 71%. RNG (pipeline) represents 3% and includes RNG produced to be injected into natural gas pipelines. Biogas represents 1% and reflects biogas used for purposes other than producing pipeline RNG. Liquid biofuels: ethanol, renewable diesel, and biodiesel represent 15%, 7%, and 4% respectively.
Liquid Biofuels
Liquid biofuels are mainly used as low-carbon alternatives to conventional transportation fuels. In 2023, a total of 158 PJ of liquid biofuels were used in Canada, which includes 91 PJ of ethanol, 24 PJ of biodiesel and 43 PJ of renewable diesel. 84% of these liquid biofuels were used as transportation fuels. The remaining 16% of liquid biofuels were used in industrial applications.
Between 2010 and 2023, liquid biofuel consumption in Canada roughly tripled. This growth reflects federal and provincial policies—such as the Renewable Fuels Regulations (2011-2022) and the Clean Fuels Regulations (2020-present)—that mandate fuel blending requirements and the reduction of carbon intensity of gasoline and diesel. In addition to ethanol, biodiesel, and renewable diesel, Canada produced its first batch of sustainable aviation fuel (SAF) via co-processing in 2024—101,000 liters—at the Burnaby Refinery in British ColumbiaFootnote 3.
Ethanol
Canada’s ethanol production capacity remained relatively stable in recent years (nameplate capacity of around 1,900 million liters per year). One planned facility in Alberta would add around 300 million liters per year of additional ethanol capacity in the near term.
In 2024, domestic ethanol production reached over 1,800 million liters (including domestic use and exports). In recent years, ethanol facilities in Canada have been operating close to capacity, often more than 90% of capacity. Domestically produced ethanol supplied only 43% of domestic demand and the remainder was met through imports from the US. Export-oriented ethanol facilities contribute modest volumes to foreign markets. Small quantities of co-processed renewable gasoline and bionaptha (renewable naptha) blended with gasoline are included under ethanol statistics.
Figure 2: Liquid Biofuel Nameplate Production Capacity in Canada
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Source: Based on project-level data from project websites and the United States Department of Agriculture Foreign Agricultural Service, Biofuels Annual 2024
Data: Liquid Biofuel Nameplate Production Capacity in Canada [XLSX 18 KB]
Text Alternative: The area graph shows the production capacity of ethanol, biodiesel, and renewable diesel stacked from 2010 to 2030 in Canada. After 2024, the chart shows planned expansions. Ethanol remains steady with limited expansion planned after 2024. Biodiesel production capacity steadily increased until plateauing in 2019, remaining relatively constant afterwards. First renewable diesel production capacity is seen in 2020, and it increases significantly through 2026.
Diesel Alternatives (Biodiesel and Renewable Diesel)
Biodiesel production capacity rose in Canada from 258 million liters in 2010 to 704 million liters by 2019 (Figure 2), a three-fold increase, and has remained relatively constant since then (current capacity around 700 million liters). No major new biodiesel projects are currently planned or under development, so capacity is expected to remain near current levels in the near term.
Small volumes of renewable diesel were processed at the Burnaby Refinery in British Colombia (B.C.) beginning in 2020, and Tidewater Renewables started commercial renewable diesel production in late 2023 in B.C. Braya Renewable Fuels' refinery in Newfoundland and Labrador—Canada’s second largest renewable diesel facility—began production in 2024. However, it entered an economic shutdown in January 2025 (mainly due to expiration of United Sates (U.S.) blenders tax credit), and remains on standby as of September 2025, awaiting market recoveryFootnote 4.
Several new renewable diesel projects are planned to come online between 2025 and 2027, potentially tripling Canada’s renewable diesel capacity. No major projects are currently planned after 2027. Two additional planned renewable diesel projects—a renewable diesel expansion at the Co-op Refinery Complex in Saskatchewan, and a new facility at the Burnaby Refinery—were paused or cancelled in 2024-2025.
In 2024, Canada produced an estimated 460 million liters of biodiesel and 687 million liters of renewable diesel. Historically, biodiesel plants have operated well below capacity (often around 50%) in Canada, mainly due to competing tax credits and overall higher margins for diesel alternatives imported from the U.S. Net imports (imports minus exports) accounted for about 47% of Canada’s diesel-alternatives demand, reflecting ongoing trade in both biodiesel and renewable diesel.
Figure 3: Liquid Biofuels Production, Imports and Exports
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Source: Biofuels in Canada 2024 – Navius Research Inc., Renewable Fuel Plant Statistics: Statistics Canada Table 25-10-0082-01, Environment and Climate Change Canada data collected under Renewable Fuel Regulations, and USDA FAS Canada Biofuels Annual 2024
Data: Liquid Biofuels Production, Imports and Exports [XLSX 20 KB]
Text Alternative: The area graph shows the production capacity of ethanol, biodiesel, and renewable diesel stacked from 2010 to 2030 in Canada. After 2024, the chart shows planned expansions. The figure illustrates three stacked area charts for production, imports, and exports of renewable diesel, biodiesel, and fuel ethanol. Ethanol production remained steady between 2010 and 2024. Ethanol imports increased significantly between 2010 and 2024, whereas ethanol exports remained low. Biodiesel production, imports and exports all increased between 2010 and 2024. Renewable diesel imports increased significantly between 2010 and 2024. Renewable diesel production and exports are first seen in 2024.
Gaseous Biofuels
Gaseous biofuels in Canada are mainly biogas. Biogas is either captured from facilities like landfills and agricultural facilities or purposefully produced. Captured biogas can be utilized or flared. Biogas can be used directly for heat, or electricity generation, or can be converted to RNG. In addition to biogas, other gaseous biofuels can be used, such as syngas produced through biomass gasification. The planned Green Impact Partners biofuels facility in Alberta aims to produce RNG from syngas derived from low-grade wheat.
In 2023, Canada utilized around 20 PJ of biogas (primary energy content). Around 4 PJ of this was used for utility-scale electricity generation (generated around 1 PJ of electricity). The industry sector used around 8 PJ of biogas for heating and cogeneration, and the remaining 8 PJ were upgraded into RNG.
Figure 4: Biogas Utilization
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Source: CER-derived values based on Environment and Climate Change Canada’s official greenhouse gas inventory, provincial utilities data, Canadian Biogas Association, and Electric Power Generation, Statistics Canada: Table 25-10-0084-01
Data: Biogas Utilization [XLSX 18 KB]
Text Alternative: This area figure shows biogas utilization between 2010 and 2023. Different utilization categories, RNG production, industrial heating and cogeneration, and utility electricity are stacked. Biogas usage for utility electricity was relatively steady from 2010 to 2023. Biogas used for industrial heating and cogeneration increased from 2010 to 2014 but declined between 2014 to 2016 and remained steady since then. Biogas used for RNG remained low to the year 2014 but increased significantly between 2014 and 2023.
Renewable Natural Gas (RNG)
RNG is a natural gas alternative that can be injected directly into existing natural gas pipelines or used for electricity generation, heating, or as a transportation fuel. RNG production in Canada increased twelve-fold between 2010 and 2024, driven by provincial mandates requiring renewable content in natural gas. B.C. has mandated 15% renewable content in natural gas by 2030Footnote 5, and Quebec targets 10% by 2030 (5% mandated by 2025)Footnote 6. Ontario has offered a voluntary RNG program for consumersFootnote 7. The majority of Alberta’s current RNG production is designatedFootnote 8 to B.C. Over 20 new RNG projects are planned to come online between 2025 and 2027, which would more than double Canada’s 2024 RNG production capacity. Provincial supply may be supplemented by RNG imports from other provinces and the U.S.Footnote 9
Figure 5 illustrates RNG production capacity, and Figure 6 illustrates Canadian RNG production and net imports (the net value between imports and exports of RNG) from the U.S.
Figure 5: Renewable Natural Gas (RNG) Production Capacity
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Source: Based on project level data from, provincial utilities, Canada Gas Association, and project websites.
Data: Renewable Natural Gas (RNG) Production Capacity [XLSX 17 KB]
Text Alternative: The area graph shows the RNG production capacity from 2010 to 2030. After 2024 are planned capacities. RNG production capacity increased significantly in 2015 and then exponentially increases between years 2022 and 2026.
Figure 6: Renewable Natural Gas (RNG) Domestic Production and Trade
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Source: CER-derived values based on Environment and Climate Change Canada’s official greenhouse gas inventory, provincial utilities data, and Canadian Biogas Association
Data: Renewable Natural Gas (RNG) Domestic Production and Trade [XLSX 18 KB]
Text Alternative: The area graph shows RNG domestic production and net imports stacked from 2010 to 2024. Domestic RNG production increased significantly in 2015 and then again between 2022 and 2024. Net imports have increased exponentially between 2022 and 2024.
Solid Biofuels
In 2023, solid biofuels were used to generate 444 PJ of energy for domestic use: 414 PJ for heating and 30 PJ for electricity (both utility scale and cogeneration). In 2023, the total primary energy content of all solid biofuels produced in Canada was around 533 PJFootnote 10. Although solid biofuel use increased from 2010 to 2014, it declined by roughly 18% between 2015 and 2023, mainly due to less solid biofuel use in the residential sector. Key sources of solid biofuels in Canada include:
- Wood residues: Leftover residues from forestry operations and wood-processing industries. Production and availability remained relatively stable from 2010 to 2023.
- Firewood: Harvested wood mainly for heating. Peak production occurred in 2014 but has declined by about 30% since then, largely due to reduced wood-burning in homes and the adoption of other heating technologies.
- Pulping liquor: The residual slurry from pulp-and-paper mills, used as an energy source within the mill or sold to third parties. Pulping liquor production peaked around 2015 and has decreased by 23% since, reflecting a contraction in Canada’s pulp-and-paper sector.
- Wood pellets: Manufactured from wood residues or firewood and densified for export. Wood pellet capacity and production grew more than two-fold between 2012 (1.5 million tonnes) and 2023 (3.5 million tonnes). Canada is a major exporter; in 2023, 83% of domestically produced wood pellets were exported, representing 9% (49 PJ) of total solid biofuel production.
Domestically, solid biofuels are mainly used for heating and cogeneration. In 2023, 69% (367 PJ) of solid biofuels were used in industrial heating and cogeneration, 14% (76 PJ) supported residential heating, less than 1% (3 PJ) went to commercial heating; and 7% (37 PJ) powered utility-scale electricity generation (generating 8 PJ of electricity).
Figure 7: Solid Biofuel Utilization
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Source: CER-derived values based on Statistics Canada Tables: 25-10-0025-01, 25-10-0084-01, 25-10-0031-01. USDA FAS Canada Wood Pellets Annual 2023, Canadian Bioheat Database, and Comprehensive Energy Use Database | Natural Resources Canada
Data: Solid Biofuel Utilization [XLSX 19 KB]
Text Alternative: The area graph shows solid biofuel utilization between 2010 and 2023, for solid fuel exports, utility electricity, residential and commercial heating, and industrial heating and cogeneration. Industrial use trended downward after peaking in 2015, residential and commercial heating remained mostly flat but dipped recently, utility electricity use remained steady, and solid fuel exports increased significantly.
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