For decades, the sawdust, bark, logging slash, and mill offcuts generated by BC’s forestry sector were treated as a cost—burned in beehive burners, chipped for low-margin hog fuel, or left to decompose on cut blocks. That calculus is changing. A combination of federal policy, cleantech capital, and maturing conversion technology is reframing BC’s forest biomass—estimated at 20 to 25 million bone-dry tonnes generated annually—as one of the province’s most underutilised industrial assets.

The opportunity is structural. BC’s primary forestry sector has shed thousands of jobs over the past two decades through mill closures, automation, and the mountain pine beetle’s devastation of interior timber stocks. The bioeconomy pivot creates a second act: new revenue streams for tenure holders, manufacturing jobs in communities that absorbed the sector’s contraction, and investment targets for cleantech venture capital accumulating in Vancouver.

The policy engine

Canada’s Clean Fuels Regulations, in force since 2022, are the primary economic driver. The regulations create a compliance credit market that makes sustainable aviation fuel (SAF) and renewable diesel commercially viable. Producers earn credits for displacing fossil fuels, which can be sold to obligated parties. For biomass-to-fuel projects, the math is increasingly favourable.

The federal government’s 2024 budget introduced a 30% investment tax credit for clean technology manufacturing, directly applicable to bio-based materials production. For capital-intensive conversion facilities, this credit materially improves project economics and shortens payback periods.

Who is moving

Commercial activity spans three categories. In sustainable aviation fuel, several BC-connected ventures are advancing projects using forestry residuals as feedstock. SAF commands a price premium over conventional jet fuel—BloombergNEF analysis has tracked SAF spot prices at two to four times the cost of conventional jet fuel. Airlines facing scope 3 emissions pressure and incoming SAF blending mandates are increasingly signing offtake agreements that justify the capital outlay.

In bio-based materials, companies are developing products that displace petrochemical inputs in adhesives, resins, and packaging. Genome BC’s research pipeline includes projects focused on extracting high-value lignin and cellulose fractions from wood waste—fractions currently in demand from materials manufacturers in Europe and Asia.

Biochemicals represent the third vector. Forestry residuals can be converted into platform chemicals—such as acetic acid, ethanol, and furfural—that serve as building blocks for industrial applications. While margins are lower than SAF, the conversion technology is more mature and capital requirements are more accessible for early-stage companies.

Foresight Canada, the Burnaby-based cleantech accelerator, supports companies in this space by connecting BC forestry biomass supply with technology developers and downstream offtake partners.

Reality check

The opportunity is genuine, but the hype risk is real. Most projects in development are pre-commercial or at pilot scale. Converting forestry residuals into SAF or biochemicals at industrial volumes requires solving feedstock logistics—slash and mill waste are geographically dispersed, moisture-variable, and expensive to aggregate—alongside conversion technology challenges. While 20 to 25 million tonnes are generated, the economically recoverable volume is lower due to terrain and transport costs. The Forest Products Association of Canada’s bioeconomy investment tracker documents significant announced capital, but several high-profile biomass-to-fuel projects in North America have faced cost overruns or timeline slippage.

Feedstock competition is another variable. As biomass gains value, tension will grow between its use as a fuel input, a materials feedstock, and existing uses such as pulp fibre and bioenergy. Tenure holders and First Nations with forest rights will have increasing negotiating leverage, which adds complexity to supply chain planning.

Vancouver’s financing role

Vancouver has established itself as a hub for climate-focused venture and project finance, with several funds targeting the bioeconomy. The city’s proximity to the feedstock base, its university research infrastructure at UBC and SFU, and its existing relationships with Asian markets give it structural advantages as a financing centre for the sector.

For BC’s forestry-dependent communities, the bioeconomy is a plausible answer to the question of what comes after the mill. The answer arriving now is partial and contingent on policy continuity. The feedstock was always there; the economics have finally caught up.