BETHESDA, Md. (News release) -- Enviva Inc. announced the signing of a new 10-year take-or-pay off-take fuel supply contract with an existing European customer, extendable for up to five years. Enviva expects to supply 800,000 metric tons of industrial-grade wood pellets per year, with deliveries expected to commence during 2027, subject to certain conditions precedent.
"We are pleased to announce a sizeable contract today with one of our power generation customers in Europe. The magnitude of market opportunities with high-quality counterparties across a range of use cases, from renewable energy generation to displacement of fossil fuel-based carbon in hard-to-abate industries, continues to drive a strong pace of contracting for us," said Thomas Meth, President and Chief Executive Officer. "Deliveries under this new contract are expected to begin in about four years, which underscores how serious our European counterparties are in shoring up renewable energy feedstock from secure, sustainable, and trusted sources. We have built solid, long-standing relationships with our customers, who understand our ESG-based business and value the quality, dependability, and sustainability of the products we're delivering worldwide."
Terms and conditions related to this new contract reflect the strong pricing environment for woody biomass and are generally in line with other recently executed long-term contracts. Enviva's contracting environment continues to demonstrate the favorable pricing dynamic of a structurally short market with limited large-scale alternatives for renewable baseload, and dispatchable, power and heat generation, and even fewer substitutes for hard-to-abate sectors.
Enviva's total weighted-average remaining term of take-or-pay off-take contracts is approximately 14 years, with a total contracted revenue backlog of now over $23 billion. This contracted revenue backlog is complemented by a customer sales pipeline exceeding $50 billion, which includes contracts in various stages of negotiation.