NORTHAMPTON, NORTH CAROLINA — Here’s a multibillion-dollar question that could help determine the fate of the global climate: If a tree falls in a forest—and then it’s driven to a mill, where it’s chopped and chipped and compressed into wood pellets, which are then driven to a port and shipped across the ocean to be burned for electricity in European power plants—does it warm the planet?

Most scientists and environmentalists say yes: By definition, clear-cutting trees and combusting their carbon emits greenhouse gases that heat up the earth. But policymakers in the U.S. Congress and governments around the world have declared that no, burning wood for power isn’t a climate threat—it’s actually a green climate solution. In Europe, “biomass power,” as it’s technically called, is now counted and subsidized as zero-emissions renewable energy. As a result, European utilities now import tons of wood from U.S. forests every year—and Europe’s supposedly eco-friendly economy now generates more energy from burning wood than from wind and solar combined.

Biomass power is a fast-growing $50 billion global industry, and it’s not clear whether the […]