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"Biomass is the organic matter in trees, agricultural crops and other living plant material. It is made up of carbohydrates — organic compounds that are formed in growing plantlife.
.... Biomass is solar energy stored in organic matter. As trees and plants grow, the process of photosynthesis uses energy from the sun to convert carbon dioxide into carbohydrates (sugars, starches and cellulose). Carbohydrates are the organic compounds that make up biomass. When plants die, the process of decay releases the energy stored in carbohydrates and discharges carbon dioxide back into the atmosphere. Biomass is a renewable energy source because the growth of new plants and trees replenishes the supply.
.... The use of biomass for energy causes no net increase in carbon dioxide emissions to the atmosphere. As trees and plants grow, they remove carbon from the atmosphere through photosynthesis. If the amount of new biomass growth balances the biomass used for energy, bioenergy is carbon dioxide "neutral." That is, the use of biomass for energy does not increase carbon dioxide emissions and does not contribute to the risk of global climate change. In addition, using biomass to produce energy is often a way to dispose of waste materials that otherwise would create environmental risks.
...Wood products industries burn wood chips, bark and wood waste to supply heat for industrial processes. Some mills use biomass fuel to generate electricity for on-site uses. Pulp mills burn the residual fiber and lignin components of spent pulping liquor to recover and recycle pulping chemicals and to generate steam. Pellets and fuel logs ... supply heat to homes." http://www.oregon.gov/ENERGY/RENEW/Biomass/BiomassHome.shtml
Biofuels refers generally to liquid fuels made from biomass. See the Energy Future Coalition's "Quick Facts on Biofuels".
Image from http://www.bioenergy.org/images/woodcycle.jpg .
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