It is almost axiomatic within the renewables community that the combustion of biomass is carbon neutral. That is to say that virtually all carbon released by burning will ultimately be offset by the absorption of carbon by new growth, provided the agricultural scheme deployed is renewable and sustainable. This assumption regarding the carbon neutrality of wood combustion is even being pushed in current Congressional legislation. While burning some biomass feedstocks might be carbon neutral, real questions arise when the fuel is wood, especially in the form of wood pellets. A growing body of evidence concludes that the use of wood pellets can be highly detrimental to the environment and, in actual fact, emits as much or more carbon than fossil fuel.
It is true that the carbon released by combustion sooner or later is reabsorbed by sustainable forests. The problem is timing. The Paris accords had as its objective the promotion of measures that would keep global temperature rise to 1.5o C by 2030. Realistically 2.5o C is probably the best achievable. But either way, what is most crucial is reducing carbon over the next 15 or 20 years. A recent report by the National Resources Defense Council (NRDC) takes an in-depth look at this issue and. 
Burning wood pellets emits about 1.5 times the carbon per unit of energy than coal and 3 to 4 times the carbon per unit energy of natural gas. And it does so all at once. This creates what’s called a carbon debt that gets repaid be reabsorption over time. That time frame is quite long depending on the proportion of whole trees used to make the pellets. The NRDC study cited above showed the following results.
The higher the portion of whole trees used (Figure 1) increases the time frame of paying off the carbon debt. In the case of 70% trees burned today, the debt does not start to be paid off until 2065. If only 20% trees are used (Figure 3), where the source is primarily wood waste and forest debris, the carbon emissions are less, but the payoff times are the same. (The NRDC study looked at bottom land hardwood forests in the southeastern US for this data.)
“Premium” wood pellets tend to be solely from whole trees, both soft and hardwood.
These “payoff” times are well beyond the critical period when carbon reductions are necessary. So while it is fair to say that wood pellet combustion is theoretically carbon neutral, the question is how long you are willing to wait for the carbon debt generated with combustion is “repaid” through subsequent sequestration.
During this critical time frame of the next 15 to 20 years, wood pellets from a high proportion of whole trees emit more carbon than any fossil fuel. In lesser proportions, wood pellets are no better than coal or natural gas. Simply not using whole trees is an option, however other studies have noted that available forest residuals alone cannot meet current biomass demand.
As you might expect, this is a matter of considerable controversy and has become a hot political topic in 2016. The current Senate energy bill (S. 2012) includes a provision that directs the Environmental Protection Agency (EPA) to classify woody biomass as a carbon neutral. Doing so would allow biomass to be an allowable alternative to coal under the administration’s Clean Power Plan. Pending House and Senate Interior Appropriations bills include similar direction to the EPA. Frankly it appears that, once again, business interests are attempting to ignore or override the scientific evidence. The Obama Administration, in a July Statement of Administration Policy regarding one of the House Appropriations bills (H.R. 5538), offered the following statement:
“Classification of Forest Biomass Fuels as Carbon-Neutral. ….The Administration strongly objects to language under the heading “Administrative Provisions—Environmental Protection Agency” in the bill, which would compel EPA to disregard the scientific recommendations of its own Science Advisory Board and other technical studies.”
There are ancillary effects to classifying biomass as an acceptable fossil alternative. If biomass were not allowed as part of the solution, a greater amount of truly clean sources would be required to meet the Clean Power Plan goals. Using woody biomass for electricity generation suppresses the use of these sources.
Given the substantial financial and lobbying resources of the industries involved in this sector it seems unlikely that science will prevail.
But that’s the story for woody biomass sourced from trees. Biomass from other sources can certainly be renewable, sustainable and be carbon neutral within reasonable time frames.
 NRDC Issue Brief “Think Wood Pellets are Green? Think Again.” May 2015 https://www.nrdc.org/sites/default/files/bioenergy-modelling-IB.pdf