Due to its location (in a populated area, with several towns and villages within a couple of kilometers), the Pego Power station is likely to pose severe health impacts due to air pollution. Air emissions from wood power and/or heat plants have comparable impacts on human health as coal burning plants. Overall, wood burning for energy is one of the two leading causes of small particulate (PM2.5) emissions in Europe and likely elsewhere, alongside traffic.

Next to that, wood dust exposure of workers and residents is linked to allergic and non-allergic respiratory and nasal problems, allergic dermatitis and two types of cancer. It is a common concern reported around wood pellet plants and woodchip storage sites. In the UK, Drax Plc is facing criminal prosecution for failing to protect workers from harmful wood dust linked to its conversion from coal to wood pellets.

At full capacity, the converted Pego Power Station would burn up to 2.6 million tonnes of wood pellets a year, equivalent to up to 5.2 million tonnes of green (i.e. freshly cut) wood. By comparison, existing biomass power and heat plants in Portugal burn an estimated 2.8 million tonnes of green wood, with a further 1.8 million tonnes of wood used for pellet production, most of which is exported.

In general, large-scale burning of biomass for energy harms the climate, people, forest and hinders the clean energy transition. This is explained in the Biomass Delusion Statement.

The two main species grown for commercial wood production in Portugal are eucalyptus and pine. Eucalyptus wood has a high chlorine content and is therefore not suitable for burning in a plant such as Pego Power Station. TrustEnergy claims that they will get around that problem by producing torrefied wood pellets on-site made from eucalyptus, which would be chemically more similar to coal. However, as an investigation by Biofuelwatch shows, no company in the world has been able to produce torrefied wood pellets at a commercial scale. 

This means that TrustEnergy would need to burn pellets produced domestically from pine and/or imported wood pellets. In Portugal, pine is already being logged at a much faster rate than it can regrow, with the president of Portugal's wood and furniture industry association declaring that “Portugal’s forest management is ruinous”. Pellet imports would likely come from North America, with the largest pellet-exporting region being the south-eastern USA. There, wood for pellets is routinely sourced from the clearcutting of highly biodiverse coastal hardwood forests.