Britain's biomass industry will miss targets necessary to meet renewable energy goals by 50% unless "blockages in the system" are removed by the government. In a letter to the new energy and climate change secretary, Ed Miliband, representatives from the wood industry say urgent action is required to put biomass back on track.

"For the government to meet its targets for generating 20% of its energy from renewable sources by 2020, the UK needs to fully harness the potential for generating energy, heat and power through biomass," writes Craig White, chairman of Wood for Gold, a pressure group for the timber sector.

"The government is assuming that 50% of that 20% target will be provided by biomass, including clean and sustainable waste wood. But blockages in the system mean that only 4.1% is currently provided by biomass and that the current rate of growth is insufficient to enable the government to meet its 2020 target. Indeed it is likely to miss it by around 50%."

Wood for Gold, which includes the Timber Trade Federation, Confederation of Forest Industries and the British Woodworking Federation, argues that large amounts of potential fuel are being buried, creating methane, one of the most potent greenhouse gases.

"Of an estimated 7.5m tonnes of domestic wood waste, much from construction and demolition, some 80% goes to landfill. Only some 4% becomes sustainable energy from biomass," adds White, who says the UK needs only about 2.7m tonnes a year of wood to meet the biomass 2020 target.

Wood for Gold is keen to see the 2012 Olympics used to showcase biomass with a large plant providing heat and power to the site in east London. There are only very small biomass plants burning wood or plant-based matter, as well as the large coal-fired station at Drax, which is experimenting with burning some non-carbon fuel.

Last week Drax, the owner of Britain's most carbon-intensive power station, said it was turning greener with a £2bn plan to build the country's first large-scale biomass plants. But it is clear the bulk of the fuel for these plants will be imported, at least in the short term.

The three facilities - in Hull, Immingham and probably Drax itself - will have the capacity to produce 900MW of electricity - enough to supply 3% of the country's total.