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Woody biomass from the southeast United States is expected to play an important role in meeting European Union (EU) renewable energy targets. In crafting policies to guide bioenergy development and in guiding investment decisions to meet established policy goals, a firm understanding of the interaction between policy targets and forest biomass markets is necessary, as is the effect that this interaction will have on environmental and economic objectives. This analysis, featured in the journal Global Change Biology-Bioenergy, increases understanding of these interactions by modeling the response of southern U.S. forest markets to new pellet demand in the presence of sustainability sourcing or harvest criteria. Based on modeled scenarios, it finds that wood pellets from the Southeast United States could be used to meet sustainability guidelines set by the EU to achieve its larger renewable energy and greenhouse gas emissions goals.