A report by BioEnergy Consult said even though biomass' share of energy production remains relatively low compared with other sources of renewable energy, it has been developing at a rapid pace. It will take on an increasingly significant role in China's energy mix with plans to increase the proportion of biomass to 15 percent of the total renewal energy sector and the total installed capacity of biomass power generation to 30 gigawatts by 2030.

It suggests that future research specific to technology assessment, in addition to data collection and supply chain management of potential resources, is necessary to continue to understand how biomass can become a game-changer in China's energy future.

Zhang said efforts are also needed to set up a unified industry standard in terms of emissions when burning biomass, a mechanism of biomass collection, storage and transportation, and regulations for biomass fuel processing factories, which are currently lacking in the industry and thus hindering its development.

"Supportive policies, like offering subsidies to both power generators and farmers who sell straw and crops for bioenergy generation, are also needed from the government for the industry's development in its current phase," Lin said.

This year, a total of 2.5 billion yuan ($388.8 million) in the government subsidies were offered to businesses in the biomass industry, up 66.7 percent year-on-year. Experts said it sends a strong signal that the government has stepped up efforts to promote the industry's development.

An analyst at the Sinopec Economics and Development Research Institute said that as part of the government's ongoing efforts to peak carbon emissions by 2030 and achieve carbon neutrality by 2060, the newly announced biomass development plan illustrates China's determination to further boost the high-quality development of the biomass power sector during the 14th Five-Year Plan period.

"The government's plans to boost the biomass energy sector will further tap the potential… especially in China's rural areas, which have abundant biomass energy, and provide strong support for biomass power generation," said Luo Zuoxian, head of intelligence and research at the institute.

The NEA has called for support from local governments for biomass energy projects, with heating being a priority, to fully take advantage of the large amount of raw materials like crops and animal waste.

"Heating in rural areas with cleaner sources will contribute significantly to the country's carbon dioxide reduction," said Luo.

To build a new electrical power system, it's necessary to step up power generation from renewables including wind, solar, hydro, geothermal, nuclear and biomass, Luo added.

Provinces like Jilin, Shandong and Guangdong are increasing efforts to support the industry's development. In Shandong, an agriculture production hub, government officials plan to apply for subsidies for 50 biomass power generation projects, with installed capacity reaching 832.75 megawatts.

China's major oil companies have been stepping up forays into the biomass sector, including China National Petroleum Corp, China Petroleum& Chemical Corp and China National Offshore Oil Corp, all of whom have outlined biomass initiatives in order to help achieve carbon neutrality and increase their installed clean-energy power capacity.

A report by the Biomass Energy Industry Promotion Association estimates that the industry will see investment of about 1.2 trillion yuan from various sources from 2021 to 2025, which could help it handle about 350 million tons of organic waste and offer job opportunities for around 1 million people.

"More business opportunities will be observed as both the government and companies accelerate efforts to turn trash to treasure. Biomass energy will play an increasingly important role in China's transition toward cleaner energy," Zhang said.