The incomplete combustion of fuel wood produces organic particulate matter, carbon monoxide and other organic gases. If high temperature combustion is used, oxides of nitrogen will be produced. At a smaller domestic scale, the health impact of air pollution inside buildings is a significant problem in developing countries, where fuel wood is burnt inefficiently in open fires for domestic cooking and space heating.
There is the potential for the widespread use of wood from natural forests to cause deforestation and localised fuel wood scarcity, with serious ecological and social
ramifications. This is currently occurring in Nepal, Southeast Asia, parts of India, South America and in sub-Saharan Africa. The conversion of forest land into agricultural land and
urban areas is a major cause of deforestation. In addition, in many Asian countries much of the wood fuel used for energy purposes comes from indigenous forest areas.
There is a potential conflict over the use of land and water resources for biomass energy and other uses, such as food and fibre production. However, the use of modern agricultural
production techniques means that there is land available for all uses, even in densely populated regions like Europe.
Some biomass applications are not fully competitive at this stage. In electricity production for example, there is strong competition from new, highly efficient natural gas-fired combined cycle plants. However, the economics of biomass energy production are improving and the growing concern about greenhouse gas emissions is making biomass energy more attractive.
The production and processing of biomass can involve a significant energy input, such as fuel for agricultural vehicles and fertilisers, resulting in a reduced energy balance for the biomass
application. Biomass processes need to minimise the use of energy-intensive and fossil-fuel based inputs and maximise waste conversion and energy recovery.
There are often political and institutional constraints to biomass use, such as energy policies, taxes and subsidies that encourage the use of fossil fuels. Energy prices often do not reflect the environmental benefits of biomass or other renewable energy resources.