The use of biomass pellets for energy production dates back to the 1970s. After the energy crisis, alternatives to fossil fuels were sought. At this time, the technology used to produce animal feed pellets has been improved to accommodate denser wood materials. Sweden is one of the pioneers in this industry due to its prominent timber industry, desire to increase energy independence and commitment to environmental conservation.

The Swedish wood pellet production plan was launched in the late 1970s, and it was decided to build a pellet plant in Muğla. The factory started production in November 1982, and problems soon appeared because the cost was much higher than budget. The equipment is to change the oil-fired boiler to the pellet fuel boiler. But the efficiency is low, not just because of the poor quality of the particles. The raw material for the first year is mainly bark. The particle ash content is usually 2.5-17%. The Mugla factory closed in 1986.

A pellet factory was built in Vårgårda in 1984 and closed in 1989. The last owner of the plant is the Volvo Group. In 1987, the first dry material pelletizing plant was built in Kil, which was designed with an annual output of 3,000 tons. This factory is still in operation and is the oldest commercial factory in Sweden.

In the early 1990s, the Swedish government came up with a proposal for a tax on fossil fuels. At this time it also limits carbon dioxide emissions. In the short term, burning fossil fuels becomes unprofitable, and biofuels enter to fill the energy gap. This was a turning point and marked the beginning of rapid growth in the use of wood pellets.

Similar clean energy plans have emerged elsewhere in Europe. As a result, Europe has become a leader in the consumption of biomass pellets. The pellets can be delivered by truck and stored directly in the storage area of ​​the residence, similar to the way gasoline is fed into a gas station. In addition to residential heating, more and more European power plants use biomass pellets to generate electricity, as well as other industrial applications.

The wood pellet fuel industry appeared in the mid-1980s, with the promotion of residential wood pellet stoves. This equipment is able to reduce particulate matter emissions, far below the new requirements of the U.S. Environmental Protection Agency (EPA) for emissions from wood stoves, and provides consumers with automated and convenient wood heating methods. The sales of pellet stoves increased rapidly in the early 1990s and peaked in 1994. Later, due to the emergence of natural gas stoves, the growth gradually became flat. Pellet fuel sales follow the demand curve of residential pellet stoves. During this period, residential uses accounted for about 95%, and the rest were industrial uses.

In 1984, two pellet plants were operated in the Pacific Northwest of the United States. Most pellet plants are owned by small companies. However, recently many large pellets have been built to meet the rising demand in Europe, and Europe has become the main pellet export destination for Canada and the United States.

The raw material used is usually wood chips. Wood shavings and wood chips are less used. This industry is composed of many independent factories whose sole business is pellet production. These factories are also part of other wood processing companies. These independent companies buy raw materials on the open market and are often larger producers.

The wood pellet industry was slowly developed from one factory to another. Many factories need a 6-18 month adjustment period. The long start-up phase is due to a variety of factors, including: raw material changes, improper design and engineering, the use of worn-out or inappropriately sized equipment and inexperienced managers and part of the production workers. Nevertheless, as the industry gradually matures and conditions continue to improve, companies generally do research and investigations in advance before entering the industry. Equipment/engineering companies provide better overall factory design and installation, improve equipment, and rely on other pellet manufacturers. Provide information and assistance.

In addition to large-scale pellet production plants, there are also some self-employed, especially in rural areas where everyone uses small machinery to produce pellets. This is a self-sufficient way to meet the needs of users in the surrounding area, and it is also a way to obtain economic benefits from the existing waste.