A spring-board for your exports

EU Handbook
Biogas Markets

Cross Border Bioenergy supports the

bioenergy industry in going international
to diversity its sales markets
Interested in the Cross Border Bioenergy Project?

This project is designed to help SMEs to evaluate markets in Europe

and support their decision-making process to invest in them.
Join the Cross Border Bioenergy network and benefit from exclusive
information on European markets. There are absolutely no cost
associated with the use of the network.

www.CrossBorderBioenergy.eu

The Cross Border Bioenergy project is supported by the Intelligent Energy Eurrope
programme (IEE/09/933/S12.558306)

The sole responsibility for the content of this publication lies with the authors. It does not necessarily reflect
the opinion of the European Union. Neither the EACI nor European Commission are responsible for any use
that may be made of information contained therein.
 EU Handbook -
Biogas Markets
Prepared by the Cross Border Bioenergy Working Group
on Biogas technologies
October 2012

Project Coordinator
European Biomass Association (AEBIOM)
Mr. Jean-Marc Jossart
Email: jossart@aebiom.org
Phone: +32 24 00 10 61
Website: www.aebiom.org

Project Partners
Austrian Biomass Association (ABA) Danish Bioenergy Association (DI Bioenergi)
Mr. Christoph Rosenberger Mrs. Kristine van het Erve Grunnet
Email: rosenberger@biomasseverband.at Email: keg@di.dk
Phone: +43 (0) 1533 07 97 25 Phone: +45 (0)33 77 33 69
Website: www.biomasseverband.at Website: www.energi.di.dk

Bioenergy Association of Finland (FINBIO) German BioEnergy Association (BBE)

Mrs. Mia Savolainen Mr. Thomas Siegmund
Email: mia.savolainen@finbio.fi Email: siegmund@bioenergie.de
Phone: +358 40 7182026 Phone: +49 (0) 228 81 00 223
Website: www.finbio.fi Website: www.bioenergie.de

Hungarian Biomass Competence Center Italian Agroforestry Energy Association

(HBCC) (AIEL)
Mr. Imre Németh; Email: obekk[at]invitel.hu Mrs. Annalisa Paniz; Email: paniz.aiel@cia.it
Phone: + 36 (0) 28 420-291 Phone: +39 (0) 49 88 30 722
Website: www.bioenergia-obekk.hu Website: www.aiel.cia.it

Latvian Bioenergy Association (LATBIONRG) Slovak Bioenergy Association (SKBIOM)

Mr. Didzis Palejs Mr. Josef Viglasky
Email: didzis.palejs@latbionrg.lv Email: viglasky@vsld.tuzvo.sk
Phone: +371 (0) 675 22 399 Phone: +421 (0)45 5206 875
Website: www.latbionrg.lv Website: www.skbiom.sk

Swedish Bioenergy Association (SVEBIO)

Mrs. Lena Dahlman
Email: lena.dahlman@svebio.se
Phone: +46 (0) 8 441 70 83
Website: www.aebiom.org

Consulting Partners
eclareon Consultants
Mr. Christian Grundner
Email: cg@eclareon.com
Phone: +49 (0)30 246 286 93
Website: www.aebiom.org

Imperial College for Science, Medicine and

Technology (ICEPT)
Mr. Arturo Castillo-Castillo; Email: a.castillo@imperial.ac.uk,
Phone: +44 (0)20 7594 7312
Website: www3.imperial.ac.uk
 Table of Content
Glossary 4

1. Introduction to the Market 5

1.1. Aim and Methodology of the Cross Border Market Handbook. . . 5

1.2. Introduction to Biogas . . . . . . . . . . . . . . . . . . . . 6

2. Comparison of European Countries 8

2.1. Cross Border Scores of EU countries. . . . . . . . . . . . . . 8

2.2. Basic Country Data. . . . . . . . . . . . . . . . . . . . . 10

2.3. Energy Policy. . . . . . . . . . . . . . . . . . . . . . . . 12

2.4. Feedstock Potential. . . . . . . . . . . . . . . . . . . . . 16

2.5. Business Cases. . . . . . . . . . . . . . . . . . . . . . . 19

2.6. Market Environment . . . . . . . . . . . . . . . . . . . . 24

2.7. Regulation. . . . . . . . . . . . . . . . . . . . . . . . . 28

2.8. Project Financing. . . . . . . . . . . . . . . . . . . . . . 30

2.9. Readiness for Uptake. . . . . . . . . . . . . . . . . . . . 31

3. Country Attractiveness - In Depth Analyses 33

3.1. Austria. . . . . . . . . . . . . . . . . . . . . . . . . . . 33

3.2. Germany. . . . . . . . . . . . . . . . . . . . . . . . . . 46

3.3. Italy. . . . . . . . . . . . . . . . . . . . . . . . . . . . 66

3.4. H
ungary. . . . . . . . . . . . . . . . . . . . . . . . . . 83

3.5. Denmark. . . . . . . . . . . . . . . . . . . . . . . . . . 97

3.6. Sweden . . . . . . . . . . . . . . . . . . . . . . . . . . 108

3.7. Latvia . . . . . . . . . . . . . . . . . . . . . . . . . . 119

3.8. Finland. . . . . . . . . . . . . . . . . . . . . . . . . . 129

4. Annex 139
 Glossary

BDEW- Bundesverband der Energie- und system in January 2013

Wasserwirtschaft NEFCO - Nordic Environment Finance
BM - Biomethane Corporation
CDM – Clean Development nREAP - National Renewable Energy
Mechanism Action Plan
CHP – Combined Heat and Power ÖNACE - Austrian classification of
CNG - Compressed Natural Gas economic activities of companies

DBFZ - Deutsches PAN - National Action Plan for Renewable

Biomasseforschungszentrum Energies

DC - Direct Current PJ - Petajoule

DEA - Danish Energy Agency PSO - Public Service Obligation

dena - Deuscthe Energie Agentur Redubar - EU project of Intelligent

DERA - Danish Energy Regulatory Agency
DIA - ‘Declaration of Activity Start’ in
Italian biogas plant approval processes
Energy
RES - Renewable Energy Sources
RS - Renewable Sources

DKK - Danish currency: Krone Saeima - Parliament of Latvia

Market Handbook Biogas

EEG - Erneuerbare Energien Gesetz SEK - Swedish Currency: Krona

EIB – European Investment Bank TPES - Total Primary Energy Supply

EMU - European Monetary Union GC - VVM - Evaluation procedure of how a

Green Certificates project affects the environment

GHG - Greenhouse Gas

HBA - Hungarian Biotechnology
Association
IFC -International Finance Corporation
4 KÁT system - current Hungarian support
program for energy from RS
LBA - Latvian Biogas Association
LIAA - Investment and Development
Agency of Latvia
METÁR system- Hungarian support
program for energy from RS, which is
supposed to replace the current KÁt
1. Introduction to the Market

1.1. Aim and Methodology of the upcoming events.

Cross Border Market Handbook To achieve these goals, the consortium
of the Cross Border Bioenergy project
The general objective of the Cross
undertook a detailed study of the five
Border Bioenergy project is to help SMEs
different bioenergy markets in Europe.
to evaluate bioenergy markets in Europe
Under participation and contribution of
with regards to cross-border investments,
many international bioenergy companies
thereby making SMEs less dependent on
and stakeholders, the consortium
fluctuating domestic market conditions
identified about 50 relevant criteria and
and strengthening the whole bioenergy
summarized them in 8 main categories.
industry. Five different bioenergy market
The 8 categories cover the important
sectors are considered: biogas, small
factors influencing the bioenergy
scale heating, district heating, CHP and
sectors, namely:
biofuels for transportation. The project
will contribute to member states’ efforts • Basic country data
to reach their targets set in the RES • Energy policy
directive, to benchmark national RES
action plans, and possibly to implement • Feedstocks
flexibility projects as mentioned in the • Business case
RES directive. • Market environment

Market Handbook Biogas

With this project bioenergy companies • Regulation
will get a ‘navigator’ on potential markets
in Europe, and get necessary tools to • Project financing
develop a market entry strategy. The • Readiness for uptake
GIS-Tool helps bioenergy companies
The identified criteria have been
in comparing European markets and,
concretized by more than 300 indicators,
based on this comparison, in defining
which are weighted according to their
possible target markets. Following this
respective importance. By doing so,
first step, the market handbooks offer
scores for each indicator, criterion and
more detailed information about single
category as well as an overall sector
countries and regions in Europe and 5
score were generated. To ensure
furthermore, describe and explain the
scientific reliability the Imperial College
situation in the different bioenergy
London was obliged with working out a
markets in Europe. The B2B-plattform
sound methodology defining the scoring
supports direct action by facilitating
and weighting mechanisms. A method
contacts and networking between
was worked out to process these criteria
bioenergy stakeholders and companies.
and find appropriate indicators, and a
In this section of the website, concrete
comprehensive template was produced.
offers and inquiries can be posted and
a calendar informs about interesting The results that are presented in this

handbook and on the website are based
on official statistics, national action
plans, support schemes and on direct
information gathered from bioenergy
experts from the single countries in
interviews and enquiries undertaken
especially for this project. As many
different reliable sources have been
Market Handbook Biogas
included in the research process, the
results offer a comprehensive picture of
the bioenergy markets in Europe.
The full list of categories, criteria
and indicators chosen for the biogas
sector is available in the biogas sector
handbook, provided for download at
www.crossborderbioenergy.eu under
the rubric ‘publications’. The annex
furthermore provides a table containing
6 the leading questions on the basis of
which the market handbook was built up
on.
1.2. Introduction to Biogas
Biogas is seen to be one of the key
technologies both to reach EU member
states targets for renewable energies
in 2020 and to meet their requirements
within the European organic waste
management directive. Regulatory
restrictions on waste management and
the introduction of dedicated support
schemes for renewable energies made
the biogas sector a booming market in
many European countries. Governments
have set up incentive systems for
paying for electricity (feed-in tariffs,
green certificates, tenders). In a
number of countries, the biogas market
is stimulated by additional payments
for the use of energy crops. They aim
to promote the increase in renewable
energy production, while the policy also
enables farm holdings to reduce their
energy dependency and diversify their
incomes in the event of falling cereal,
milk or meat prices. Other countries
question the environmental soundness
of using energy crops such as maize
for methanisation, preferring to convert
already existing waste feedstock.1
1 EurObserv’ER, http://www.eurobserv-er.org/pdf/
baro200b.pdf
77
Market handbook
Sector Handbook biogas
Biogas
 2. Comparison of European Countries

2.1. Cross Border Scores of EU countries

Top Ten Country Scores - Biogas (November 2011)

The Top Ten Country Score gives an overview of the ten most attractive countries
Market Handbook Biogas

in the biogas sector. All indicators are included in this overall score, which can be a
first indicator of attractiveness.
Source: all tables and figures that are not cited otherwise are based on datat from
the CBB project: http://www.crossborderbioenergy.eu (November 2011)

Top Ten Country Scores - Biomethane (November 2011)

8 8

The Top Ten Country Score gives an overview of the ten most attractive countries
in the biomethane sector. All indicators are included in this overall score, which
can be a first indicator of attractiveness.
‚Overall attractiveness of European Countries
for biogas‘

The map displays the overall attractiveness

of the EU 27-member states‘ biogas markets.
The darker the green, the higher the attrac-
tiveness.

Market Handbook Biogas

9
 2.2. Basic Country Data
The analysis of the countries‘ basic data is based on the analysis of the geographical
and climatic conditions, demography and logistical infrastructure. The figure below
shows the CBB basic data score for all European Countries.

‚Scoring of the basic data of EU countries with regards to biogas projects‘

Market Handbook Biogas

Biogas is a renewable energy source All EU countries have a biogas sector

(RES) that is technically fully established,
producing heat, steam, electricity and
vehicle fuel. The main utilisation of biogas
is governed by national frameworks,
such as the tax system or feed-in tariffs.
Worldwide, biogas is mainly used for
electricity production. A growing portion
of biogas is used for vehicle fuel. There
is no doubt that the role of biogas in
10 the European energy mix is steadily
growing. Biogas facilities can be ramped
up and down at the touch of a button.
As renewables increasingly make up
a greater share in energy supply, this
function becomes more important
allowing the coverage of peak demands
and the balancing off down periods of
other renewables.
that produces energy, but just ten
countries provide 85% of the total biogas
production in Europe. The level of biogas
production does not always correlate
with the size of the country (see Figure
‘Main European Producers’).
Biogas in Europe is produced in large
scale digesters found preliminary in
industrial countries for sewage sludge
treatment and stabilisation purposes,
as well as in small scale digesters on
individual farms. Biogas is also produced
during anaerobic degradation in landfills
which is then referred to as landfill gas.
Many of the larger scale digesters
are using the newest technologies.
Biogas is a real success in Germany
where the number of biogas plants
reached more than 7200 in 2011. Other Netherlands experience very positive
best practice countries like Austria, market developments which encourage
Denmark, Sweden, Switzerland and the other countries to follow the example.

Figure ‘Main European Producers’: Biogas production in the most important European
producer countries in ktoe in 2009

Market Handbook Biogas

Source: European Biogas Association – EBA

‚Scoring of the density of gas transmission and distribution networks (km/km2)‘

11
 2.3. Energy Policy
The European Policy category analyzes how ambitious the NREAPs, the appropriate
measures proposed by country and the political will to develop the RES-sector are.
On the basis of these results, the Cross Border Bioenergy consortium scores the
EU countries as depictede in the graph below.
‚Scoring of the energy policies in the biogas sector‘

There is a significant potential for the In Germany the share of RES in the
Market Handbook Biogas

development of RES in the EU, and the
use of biogas to produce renewable
electricity and heat can substantially
contribute to the increase of the share of
RES in the EU energy mix. RES used for
electricity production received relatively
more attention in Europe to those
used for heating and cooling purposes.
This is surprising since the demand for
heat consumes the largest share of the
primary energy supply.
12 The EU has set the following objectives
for its member states until the year
2020: to reduce greenhouse gases (GHG)
by 20 % compared to the year 2005, to
increase the share of renewable energy
by 20 % and to increase the efficiency
by 20 %. These targets are binding but
divided individually among the member
states.
electricity market reached 20.1 % in
2011. Biogas already provides more
than 5% of the total electricity demand.
If the development of the recent years
continues, an increased share of RES
in the entire electricity market up to
35% is possible by 2020. The German
government aims at reaching a share
of RES on final energy consumption of
approximately 20% in 2020, thereof
35% in the electricity sector and rising to
80% in 2050. Due to its characteristics of
storable feedstock and a flexible energy
supply, bioenergy will play a key role
in this strategy. Amongst the different
bioenergy technologies, the amount of
electricity produced by biogas plants
(including sewage and landfill gas) is
planned to be increased from 13.9 TWh
in 2010 to 23.4 TWh in 2020, requiring
an increase of capacity from 2.5 GW to
3.8 GW in the same period.1
Due to these requirements Austria is
bound to reduce its GHG emissions in the
sectors covered by the ETS, by at least
21 % and in those sectors not covered by
the ETS by at least 16 %. Furthermore,
it has to increase the share of RES of its
total energy consumption to 34 % – the
share in the transport sector should be
at least 10%.
In Italy, electricity generated from
RES is mainly promoted through a
quota system (certificati verdi). The
quota system obliges all producers and
importers of electricity to generate a
certain quota of electricity from RS or
purchase a certain amount of green
1 Federal Ministry for the Environment, Nature
Conservation and Nuclear Safety, http://www.bmu.
de/files/pdfs/allgemein/application/pdf/nationaler_
aktionsplan_ee.pdf
‚Country scoring NREAP biogas‘
certificates. As an alternative, small
systems and expensive technologies like
photovoltaic generation may participate
in various kinds of price schemes, which
may be more cost-efficient than the
participation in the certificate system.
The Italian nREAP is denominated
‘Piano di azione nazionale per le energie
rinnovabili dell’Italia’ (PAN, National
Action Plan for Renewable Energies). For
2020, the target for biogas set by nREAP
is 0,51 Mtoe (see more below – Chapter
‘Biogas in Italy’).
Hungary is subject to a binding target
of supplying 13 % of its total energy
demand from RES by 2020. According to
the Renewable Energy Strategy for 2007-
2020 with which the target is supposed
to be reached, the use of RES must be
increased from 55 PJ in 2006 to 186.4 PJ
Market Handbook Biogas
by 2020. However, in Hungary’s National
‚Country scoring NREAP biomethane‘
13
 ‚Targets for biogas for heat and electricity‘

‚Proposed measures for CHP electricity in the NREAP‘ (Score between 0 and 10 beased
on expert interviews)
Market Handbook Biogas

14
Energy Efficiency Action Plan, approved
in December 2010, the government has
set an even more ambitious target of
14.65 %. The 2010 target of 3.6 % was
actually achieved in 2007, mainly due to
the increase of biomass utilisation. By
2020, the potential biogas production is
expected to reach 32 MW, which would
reflect 5 % of the total renewable energy
generated in Hungary.
In the UK the biomass sector plays a
strategic role: Electricity production
from RES in the UK is regulated with
a combination of feed-in tariff and
volume control. The volume control is a
kind of quota obligation with a trade of
certificates.2
The Swedish government aims at
reaching a share of RES in final energy

Market Handbook Biogas

consumption of approximately 50% in
2020, and a balance of zero net CO2
emissions by 2050. With the introduction
of the carbon tax in 1991, Sweden
installed a strong policy instrument
that has led to a large market gain
for cheaper domestic bioenergy. The
Kingdom of Sweden promotes renewable
energy through various incentives,
the most important of them being the
quota system, which is based on a
certificate trading system. Furthermore, 15
tax regulation mechanisms and a grant
scheme have been introduced. The
biogas sector, however, is not supported
in an adequate way compared to other
RES.

2 www.res-legal.de
 2.4. Feedstock Potential
This category analyzes the biomass potential for the development of biogas projects.
The graph below shows the scores for all EU countries.

‚Scoring of the municipal and commercial bio-waste potential‘ (Tons/year)

Market Handbook Biogas

The overall potential of biomass for

‚Feedstock potential for the production of
energy in Europe is much bigger than its
biomethane‘
present use, but this potential still has
to be developed at the local, regional,
national and international level. Biogas
is produced during an anaerobic
digestion of organic substrates. It can
be produced from most types of organic
raw material, except for lignin, which is
not anaerobically degradable. The most
common substrates for biogas production
16 in Europe are agricultural products
(energy crops) and by-products, such
as manure, followed by various kinds
of biowaste, including sewage sludge,
source separated municipal waste,
and organic fractions of household and
industrial waste. Trends show that the
use of raw materials for the production of
biogas will change more and more from
agricultural biomass to waste materials ‚Feedstock potential for the production of
(see Figure ‘Outlook Bioenergy’). biogas‘
The theoretical potential of the primary
energy production from biogas in 2020 is
166 million toe.3 As can be seen from the
Table ‘Biogas Production’, biogas sources
vary distinctively among the members of
the EU. Germany, Austria and Denmark
produce the largest share of their biogas
in agricultural plants using energy crops,
agricultural by-products and manure,
whereas the UK, Italy, France and Spain
predominantly use landfill gas. This
source might not increase further in
the medium and longer term as the EU
directive on landfill waste foresees a
gradual reduction of the land filling of
biodegradable municipal waste (by 2016
to 35% of the level in 1995).

Market Handbook Biogas

3 Source: AEBIOM

Figure ‘Outlook Bioenergy’: Outlook for bioenergy sources in Mtoe

17

Source: AEBIOM
 Table ‘Biogas Production’: Primary biogas production in the EU 2006 and 2007 in ktoe.
Market Handbook Biogas

18

Source: AEBIOM/EurObserver ER 2008

2.5. Business Cases
The business case analyzes the price levels, subsidy guarantees and support
schemes that affect the viability of bioenergy technology applications. In the Figure
‘Business Case’, the scores of all EU countries in this category are shown.

‚The scoring of the business case with regards to biogas‘

Market Handbook Biogas

‚The scoring of the business case for biomethane projects‘

19
 The future of the development of biomass
depends to a large extent on the incentives
created by the EU member states. The
potential of bioenergy technologies to
further penetrate the electricity and heat
market depends on:
• The sustainability of biomass sources
• The competitiveness of energy or other
products based on biomass
• The rate of progress of biomass tech-
nology
The case of biogas generally shows
that feed-in tariffs and other incentive
schemes can be very effective to
contribute to huge market growth in the
biogas sector. In Germany, however,
biogas and biomethane - depending in
which markets biogas is used - still rely
on support to be competitive with natural
Market Handbook Biogas
‚Map of fossil fuel prices across EU countries‘
20
gas, coal, fossil oil and nuclear energy
although prices for fossil based energy
have increased significantly within the
last decade. Prices for biogas electricity
vary significantly due to different plant
sizes, feedstock used, and technologies
applied. In general, feed-in tariffs of the
EEG reflect total production costs, from
which spot market prices for conventional
electricity has to be subtracted to get
the extra costs of biogas-electricity.
Feed-in tariffs for biogas range between
6 ct/kWh to 25 ct/kWh in 2012.
Average extra costs of all bio-based
electricity (solid biomass + biogas) in
2011 was 12.79 ct/kWh according to
BDEW while the spot market price for
electricity ranged somewhere between
5 and 5.5 ct/kWh. To enable a profitable
operation of bioenergy and biogas plants
nonetheless, the German government
‚Map of operations support‘
introduced the Renewable Energies
Law EEG in 2000, which guarantees a
fixed tariff for produced electricity fed
into the electricity grid. The tariffs are
differentiated by technology, capacity
and feedstock used and paid for a 20-
year period. From 2013 on, each year
tariffs for new biogas plants are lowered
by 2% to incite technology improvement
and efficiency. Since 2012, biogas plants
up to 150 kWel capacity are eligible to
receive a tariff of 14.3 ct/kWh, 12.3 ct/
kWh for a capacity of up to 500 kWel, 11
ct/kWh for a capacity of up to 5 MWel,
and 6 ct/kWh for a capacity of up to 20
MWel.
Table ‘Support Schemes’: Support schemes for biogas in EU countries in 2012
Source: www.res-legal.de
In general, the Austrian feed-in law also
offers excellent framework conditions by
providing investment security with its 15
to 20-years payment period guaranteed
for the tariffs, prioritized grid access
and a purchase obligation of the grid
operator. The feed-in tariffs for biogas in
2012 (compare Table ‘Support Schemes’)
are the same as in the previous year.
Appliances up to 250 kW receive 18.5 ct/
kWh, appliances between 250 and 500
kW are paid 16.5 ct/kWh, and bigger
biogas appliances get 13 ct/kWh. If heat
is also used, additional 2 ct/kWh are
paid. The usage of waste reduces the
tariffs by 20 %. Appliances up to 250 kW
Market Handbook Biogas
21
 ‚Legally guaranteed price for electricity from biogas plants of 500 kW capacity in 2010‘
(€cent/kWh)
must use a minimum of 30 % manure.
Market Handbook Biogas
An utilisation ratio of at least 60 % is
required to get a subsidised tariff. Under
these conditions new appliances are only
cost-effective when the raw material
supply is excellent and the produced
heat is used.
The investment costs of biogas plants
in Italy can range from 250 to 700 €/
Nmc per anaerobic digester, or between
2500-7500 € per kWe installed. A typical
22 investment will be amortized in about 4-8
years. The subsidies for the operation
of biogas plants are based on a feed-
in-tariff instrument for biogas plants
with CHP units up to 0.999 MWe. The
tariff has not been set by the PAN but
it has been fixed by the national Italian
Law no. 99/2009. The great incentives
for electricity production from biogas
(feed-in-tariff = 0.28 €/kWhe lasting for
15 years) has induced many farmers to
invest in CHP plants with biogas. With
regards to the incentive schemes, the
bottleneck is represented by the money
to be paid for stimulating all RES. The
overall budget for electricity production
is based on the electric tariff which is
paid by all Italian electricity consumers
(private households, industries, public
structures, etc.) to the electricity service
company (ENEL). The economic crisis and
the increasing demand for the subsidies in
place for all RES (including photovoltaic,
solar, wind, hydro, biomass, etc.) put the
entire system under pressure pushing
policy makers to decrease the level of
subsidies and to find other systems for
developing RES.
‚Legally guaranteed price for electricity from biogas plants of >500 kW capacity in 2010‘
(€cent/kWh)

Market Handbook Biogas

23
 2.6. Market Environment
The chart below shows the EU countries´scores based on the analysis of the energy
market dimensions in these countries. Here, the consortium of the Cross Border
Bioenergy project analyzed the energy market, transferable technologies, as well
as logistics and access to the customer base through established networks.

‚Scoring of EU-countries‘ market environments for biogas‘

Market Handbook Biogas

Biogas can be used in more or less all
the applications that are developed for
natural gas. For some of the applications
it may have to be upgraded. Injection
of biogas into the natural gas grid will
result in an improved security of supply.
This is important due to Europe’s
increasing dependence on imported
natural gas. Only two thirds of European
gas consumption is covered by gas from
24
the EU. The benefits of gas as fuel have
resulted in increased use. Natural gas
accounts for 23% of Europe´s energy
consumption in 2010.
More than 90% of Europe´s biogas plants
operate CHP plants to produce heat and
electricity. The most common technology
for power generation is internal
combustion. Engines are available in
sizes from a few kilowatts up to several
megawatts. Modern engines have good
electric efficiencies up to 48% at sizes
of 250 kW or more. Micro-turbines
in the range of 25kW to 150 kW have
been successfully introduced in biogas
applications. They have lower electric
efficiencies (26% to 34%), however,
they are marked by low maintenance
cost and low emissions.
The size of a biogas plant has to be adapted
to the individual situation, especially
to the availability of input material in
close proximity to the facility. Units of
agricultural biogas plants normally reach
sizes of 100-150 kWel. Larger plants are
economic if the input material is readily
available in close range, for example
cattle breeding, fields of dedicated
biogas crops or waste water treatment
facilities. Especially economies of scale
play an important role for upgrading the
raw biogas to natural gas standards.
The generation of biogas is growing
as never before – new strong markets
emerge especially in Eastern Europe.
More and more countries create the
necessary general frameworks for a fast
growth of the national biogas industries.
The prototype for this restructuring is the
German EEG. The system of fixed feed-
in tariffs for electricity from renewable
energies is gradually establishing
throughout Europe.
In Germany there are more than 7800
installed biogas plants. They produce
more than 3300 MWel. Most of the
plants are located in rural areas or in
regions with high agricultural potential
like Bavaria, Lower Saxony, Baden-
‚Map of the energy sector in the EU‘
Württemberg and Schleswig-Holstein. In
2011, 80 biogas plants fed biogas into the
grid.4 More than 4.2 million households
are provided with electricity produced
from biogas. More than 3% of the whole
German electricity consumption is
produced with biogas.
By the end of 2009, electricity generation
systems based on solid biomass with a
capacity of 313.4 MW, biogas plants with
a capacity of 77 MW, systems based on
liquid biomass with a capacity of 9.6
MW, and plants working with landfill-
and sewage gas with a capacity of 21.2
MW were established in Austria. These
plants generated 2,566 GWh in total.
The electricity was fed into the grid and
subsidised by the Renewable Energy
Act. Additionally 1,100 GWh of electricity
from black liquor and 600 GWh from
Market Handbook Biogas
sewage sludge, carcass meal and other
renewable waste were generated without
subsidisation. In total, 4,300 GWh of
electricity were generated from biomass
sources.
The potential of biogas in Italy has been
estimated at 20 TWh/year corresponding
to the installed capacity of about 2.700
MWel. In May 2011, 521 biogas plants, of
which 130 are under construction, were
inventoried with a total power installation 25
of around 350 MWel. These plants are
mainly located in northern Italy.
In Hungary natural gas, of which 80%
are being imported, has the biggest
share in the energy consumption mix
(44%). Hence, the substitution of natural
gas by domestically produced biogas
has become a particularly pressing
4 German Biogas Association: www.biogas.org
 ‚Growth rate of biogas in the heat market over the last 4 years‘
Market Handbook Biogas
issue. The Hungarian National Renewable
Energy Strategy (nREAP), therefore ,
places special emphasis on promoting
biogas production and use. Hungary
is among those EU countries that have
a considerable biogas potential. Biogas
production and the utilization of this
potential is still a task for the future.
Before 2003 Hungary did not have a
single agricultural biogas plant. Biogas
26
production and its utilization for the
production of electrical energy had mainly
to do with sewage treatment plants until
recently. During the last years, however,
a strong increase in biogas production
has been recorded.
In Denmark in 2010, biogas contributed
4,278 TJ to the production of renewable
energy, representing 3 % of the total
renewable energy production. So far,
the production is spread out to 20 large
common biogas plants and 50-60 farms
operating biogas plants. The common
biogas plants have the capacity to treat
100-600 tons of manure and other kinds
of biomass per day. The biggest common
biogas plant treats manure from 50-100
livestock herds in the area. Farms with
biogas have capabilities within a range
of 10-100 tons of manure per day.
In Sweden Bioenergy is the country’s
largest energy source and around
140 TWh thereof are used annually.
Bioenergy surpassed oil as the major
energy source in 2009, and bioenergy
usage is bigger than that of hydro and
nuclear power combined. The majority is
used by industry, followed by domestic
small-scale heating and district heating
systems. In 2010, 229 biogas production
units were installed in Sweden. Of these,
135 were sewage plants, 5 industrial
plants, 18 combined fermentation plants
(organic waste and manure) owned by
municipalities, 57 collection sites for
remnant gas from closed landfills, and 14
farm instalments. The largest plants are
made up of industrial and sewage plants,
whilst landfill and farm instalments
constitute the smaller plants. The largest
biogas production can be found in the large
cities, indicating the large dependence on
organic waste and sewage plants.

Market Handbook Biogas

‚Overview of the expected additional gas demand until 2020‘

27
 2.7. Regulation
This category refers to additional mandates, rules and authorisation procedures
that impact the stability and practicality of operations in the bioenergy industry,
such as efficiency standards or pollution limits. This category was only analyzed in
those countries that participated in the Cross Border Bioenergy project consortium:
Austria, Germany, Denmark, Hungary,Latvia, Finland, Italy, Sweden and Slovakia.
Estonia, Lithuania, Slovenia and Romania were also analyzed but in less detail.
‚Scoring of the regulations in the biogas sector‘
Market Handbook Biogas

The financial support for biogas ‚Map displaying the adequateness of appro-
and biomethane used in CHP is val procedures‘
complemented with regulations for grid
access, grid transmission and sharing of
grid connection costs. For the electricity
grid, rules are defined within the feed-
in laws itself. Furthermore, there are
different regulations in every country that
28 engineers have to take into consideration.
There are different limiting values for
noise emissions, emissions into the air,
and various public authorities on the
local, regional and national level who
pass certain instructions.
In Germany there are the following laws
which have to be followed: for instance
GasNZV, GasNEV, ARegV, Strom NEV
etc. In these regulations, grid operators
are obliged to feed RES-electricity,
respectively biomethane, into their grid,
to extend their grid if required, and to
transmit RES electricity with priority
through the grid. Costs for the connection
of the biogas plant to the nearest feasible
connecting point have to be covered by
the biogas plant operator.
In Austria there are a variety of rules
and laws for CHP-plants operating
with biomass. Some of the most
important regulations are declared
in the ‘Green Electricity Law Austria
2012’, the ‘KWK-Gesetz’ (CHP law),
and the ‘Emissionsschutzgesetz für
Kesselanlagen – EG-K’ (emission law for
boiler plants in Austria).

Market Handbook Biogas

29
 2.8. Project Financing
This category addresses elements of export feasibility, such as a good credit market
in the country, good conditions as a target for export as reflected in the Euler-
Hermes Rating for instance. The graph below shows the scores for all EU countries.
‚Scoring of the project financing sector in the biogas and biomethane sector‘

As the result of the financial crisis 3. Impact of bank regulations on asset-

from mid 2008 onwards, multilateral liability mismatches.
Market Handbook Biogas

banks, such as the EIB have filled a

void on the project finance market and ‚Standard and Poor‘s Ratings in the EU‘
have increased their involvement in
supporting RES projects significantly. As
an example, the EIB’s loans to the RES
sector reached over €4 billion in 2009.
Capital availability in the renewable
sector from the banks is influenced by a
number of factors:
1. Capacity of banks to lend long-term
30 to the renewable energy sector;
2. Ability of banks to recycle that loan
capital through secondary loan markets
to other long term institutional lenders,
such as pension funds, insurance funds
or other capital markets (through
financial mechanisms through project
loan securitizations etc.);
2.9. Readiness for Uptake
This category was only analyzed for the countries partners of the CBB project. It
includes the availability of support these countries have, such as industry associations
and it also reflects the reality of the potential customer base in terms of awareness,
willingness to adopt the technology, as well as information about the maturity of
the market.

‚Scoring of the readiness for uptake of biogas and biomethane‘

Market Handbook Biogas

The readiness for uptake for the biogas
sector in Europe is considered to be good,
though new projects need to be planned
and implemented in a considerate way
under participation of local inhabitants
and stakeholders.
Currently under preparation, the Biofuels
Technology Platform in coordination with
other Biomass Associations, the EU’s
Bioenergy Industrial Initiative is one such
tool to secure the long term objectives
running in close cooperation with the EU
Commission and industry stakeholders.
Technological development will be
important for the future of the industry,
but in the meantime, ways to commercial
success must be found by using existing
technologies.
Renewable energies in general are
warmly welcomed by society, and as
bioenergy is the largest energy source
in Europe, the market is well aware of
the importance of bioenergy. 31
The accelerated development of RES
in Europe is accepted by a huge
majority. However, when it comes to
biogas, opposition on local bases has
intensified in recent times. Several
biogas projects had to be stopped due
to local initiatives and heavy opposition.
Nevertheless, such incidences remain
 to be exemptions rather than common ‚Map displaying the public acceptance of bio-
practice. The main arguments against gas and biomethane projects‘
biogas are: Firstly, there are concerns on
increased truck traffic for the feedstock
supply on improper local roads, meaning
a higher risk for inhabitants and a
higher stress for roads which may not
be suited for high weights. Secondly,
as the biogas production is the result
of biological decomposition processes
in the fermenter, residents are worried
about odour annoyances. Thirdly, as
biogas production in Europe is often
based on energy crops, inhabitants and
environmental NGOs are opposed to the
increased cultivation of corn for energy
purposes due to environmental reasons
(lower bio-diversity, impact on landscape
picture, many areas with high-growing
plants) as well as due to concerns about
Market Handbook Biogas

utilizing food-suitable crops for energy

purposes.

32
3. Country Attractiveness - In Depth Analyses
3.1. Austria

Austrian Biomass Association (ABA)

Christoph Rosenberger
Franz Josefs-Kai 13
A-1010 Wien
Tel.: +43-1-533 07 97 25
Email: rosenberger@biomasseverband.at

3.1.1. Country Score

Country Score Upper Austria - Biogas (November 2011)

In the general sco-
ring for sector, Aus-
tria - Upper Austria
is rated place 55 out
of total 81. The un-
derlying categories
that influence this
result are displayed

Market Handbook Biogas

in the bar chart.

Country Score Upper Austria - Biomethane (November 2011)

In the general sco-
ring for sector, Aus-
tria - Upper Austria
is rated place 53 out
of total 81. The un- 33
derlying categories
that influence this
result are displayed
in the bar chart.
 3.1.2. Basic Data1
Austria is a democratic republic. All of
the political institutions established by
the constitution are elected in three
elections: Citizens vote the Federal
President, the National Council and the
Provincial Parliaments.
The country consists of nine federal
states (see Figure ‘Map Austria’). The
capital and largest city is Vienna. Austria
has a land area of 83.879 km2 (573 km
between the western and easternmost
points of Austria, the longest north-
south stretch totals 294 km) and is,
thus, somewhat smaller than Portugal
and Hungary and somewhat larger
than the Czech Republic. Located in the
southern part of Central Europe, the
Market Handbook Biogas
1 Statistics Austria: Austria – data, figures, facts,
Vienna, 2011; http://www.statistik.at/web_en/pub-
lications_services/austria_data_figures_facts/index.
html
Graph ‘Map Austria’: Austria as a federal state
34
Source: Statistics Austria: Austria – data, figures, facts, Vienna, 2011
republic shares borders with Germany
and the Czech Republic in the north,
the Slovak Republic and Hungary in the
east, Slovenia and Italy in the south,
and Switzerland and Liechtenstein in the
west.
8.4 million Austrian inhabitants were
counted at the beginning of 2011. By
2050, the figure should reach ca. 9.4
million, according to the projection. The
municipality with the largest population
is Vienna, which had 1.7 million residents
at the beginning of 2011. A fifth of
Austria’s population thus lives in the
federal capital. Next come the provincial
capitals Graz (262.000 residents), Linz
(189.000 residents), Salzburg (148.000
residents), and Innsbruck (120.000
residents).
Austria’s weather is characterized by
a transitional climate. Consequently,
an oceanic climate with moist westerly
winds predominates in western Austria,
and as one moves eastward, the climate
becomes increasingly continental with
decreasing precipitation, hot summers,
and cold winters. In addition, the local
climate is strongly influenced by the
altitude, local topography, and exposure
to the prevailing westerly weather
conditions.
Useful links:
• ÖNACE – Austrian classification of eco-
nomic activities of companies
• Statistics Austria
3.1.3. Energy Policy
As a contracting party of the Kyoto
Protocol, the EU is obliged to reduce the
GHG emissions in the period from 2008
to 2012 by 8 % compared to Kyoto base
year of 1990. Austria has to reduce its
emissions by 13 % according to the EU
internal burden-sharing. In the year 2009,
GHG emissions in Austria reached 80.1
million tons - 11.3 million tons more than
the allowed averages for the period 2008 to
2012. In consideration of the EU Emissions
Trading System (EU ETS), the projects
under the Joint Implementation and the
CDM, and the balance from afforestation
and deforestation, the deviation from the
target sums up to about 5 million tons
of CO2-equivalents. So the over-all gap
from the years 2008 and 2009 results in
11.9 million tons of CO2-equivalents. To
keep the over-all gap as small as possible
the implementation of effective domestic
measures is necessary.
In oder to meet the EU requirements,
Austria is bound to:
• reduce its GHG emissions in the sec-
tors covered by the ETS, by at least 21
% and in those sectors not covered by
the ETS by at least 16 %,
• increase the share of renewable ener-
gy sources of the total energy consump-
tion to 34 % – the share in the transport
sector should be at least 10 %
• reduce the energy consumption by 20
% compared to the prognosticated level
of the year 2020 by improving the ener-
gy efficiency.
The following Table ‘Consumption
Bionenergy’ shows the development
and the expectations of bioenergy
consumption in Austria from 2005 to
2020.
Market Handbook Biogas
The Green Electricity Act in Austria
provides the main framework for the
electricity generation from biomass and
biogas. It is assumed that both, the
electricity generation from solid biomass
and from biogas can be extended by 100
MW, if the Green Electricity Act creates
appropriate boundary conditions that
allow an economic system operation.
With these systems additional 1,300 GWh
of green electricity could be generated.
35
The most important measures for a
further expansion of green power are:
• Longer-term predictability of frame-
work conditions is required. In the inte-
rests of long-term development, stable
framework conditions should be created.
• The power generation from solid bio-
mass should focus on the decentrali-

Market Handbook Biogas
36
sation of plants. Hence, plants with a
capacity of less than 500 kW are re-
commended, because efficient regional
supply concepts are more reasonable
than nationwide mega-projects. Dome-
stic companies are working intensively
Table ‚Consumption
Bioenergy‘: Consump-
tion of Bioenergy in
Austria – Develop-
ment & Potential from
2005 to 2020
Source: Statistics
Austria, Energy Balan-
ces 1970-2009, Poten-
tial Analysis, Austrian
Biomass Association
to develop new technologies for low
capacity-systems. Only if these compa-
nies can establish their products on the
domestic market, they are able to use
the enormous export opportunities. Ad-
ditionally, especially small-scale facilities
in existing biomass heating plants and
industrial plants offer a great potential
to switch from only heat generation to
combined heat and power.
• For the green electricity generati-
on from solid biomass new sources like
short-rotation wood, corn cobs and other
agricultural residues should be used to
complement the raw material range.
• When raw material for biogas plants
is produced, it is important to avoid a
competition for agricultural land with
the food and feed production, since food
production has the highest priority. Both
- food and bioenergy production – are
possible when well planned. A conside-
rable potential for a further expansion of
biogas usage arises from higher yields
through the use of fertilizers as well as
the use of grassland biomass and catch
crops. Small systems based on those
raw materials, should be considered in
the Green Electricity Act. This manage-
ment measure would also lead to decre-
asing carbon emission in the rural areas.
In larger biogas plants the gas produc-
tion should focus on fuel production or it
should be fed into the gas grid.
In the future the cascading use of
resources is important. Accruing residual
products should be used in biogas plants
to generate energy.
3.1.4. Feedstock
The forest cover is particularly high
in Austria: Almost half (47.6 %) of the
Federal area is covered by forest. This
reflects 3.99 million ha or 39.926 km2
of the Austrian Republic.2 National
agriculture and forestry not only
forms the backbone of a viable rural
community, but also reflects the cultural
tradition of the nation. Structural
changes to the economy have obviously
had an impact on agriculture and
forestry: As in most other EU member
states, a steady downward trend in the
number of operations is accompanied by
a simultaneous increase in the average
size of the operations. The total output
of agriculture and forestry accounted
for € 8 billion in 2010. The Table ‘Land
Use’ shows the distribution of the land
Market Handbook Biogas
use in Austria, subdivided to the federal
states. The agricultural sector plays
an indispensable role. Among other
things, this includes ensuring nutritional
produce, preserving the cultural
landscape, landscape management and
maintaining its function as an energy
source. The ability to compete within
the EU is achieved through sustainable
agriculture, and through an increasing
specialization of agricultural and forestry 37
operations. The coupling of agriculture
and forestry with the tourist industry,
and the increasing cultivation of energy
crops to promote sustainable raw
materials, guarantees the conservation
of an economically healthy, productive,
farmer-oriented agriculture and forestry
2 Federal Research and Training Centre for Forests,
Natural Hazards and Landscape; http://bfw.ac.at
 Table ‚Land Use‘: Percentage of land use1) in Austria 2010

Source: Federal institution of Statistics Austria: Facts & Figures – Annual edition 2011;
1) Land use per usage type according to Kataster of the Federal Office for Metrology
and Surveying; 2) Built-up areas, gardens, vineyards and other areas

in a functional rural community.3 This corresponds to 7.2% of the arable

land and 1.4 % of the grassland. In
Market Handbook Biogas

In addition to raw materials from forests

and timber processing industries,
domestic wastes and agricultural
feedstocks will gain more importance
as bioenergy input material in Austria.
These raw materials can be used for the
production of solid biomass, biogas and
biofuels. In 2009 in Austria about 46,500
ha of arable land and grassland were
used for the production of biomass, while
energy crops on arable land dominated
38 strongly (46,000 ha). This corresponds to
3.4 % of the total arable land in Austria.
Until 2020, the cultivation of energy
crops as main crop could be extended
to 122,000 ha, roughly 80 % on arable
land and 20 % on grassland.
3 Statistics Austria: Austria – data, figures, facts,
Vienna, 2011; http://www.statistik.at/web_en/pub-
lications_services/austria_data_figures_facts/index.
html
addition catch crops can be produced
on 23,000 ha and harvesting residues
can be taken from 150,000 ha. The
increased use of biomass wastes and
residues from agriculture like dung also
provide additional energy potential.
In 2009 about 25,000 ha of arable land
and grassland were used to produce raw
materials especially for biogas plants,
mainly energy crops such as corn silage.
The use of catch crops and grassland
for energetic purposes was estimated
at 1,000 ha. It is estimated that the
energy crop production on arable land
will increase (e.g. silage maize, millet) to
around 45,000 ha by 2020. The produced
energy amount in form of biogas could
increase from 4.3 PJ in 2009 to 7.9 PJ in
2020. If in 2020 4 % of the corn cropland
(about 23.000 ha) is used for catch crops
cultivation for the biogas production, 1.3
PJ of primary energy could be produced.
Through the use of 1 % of grassland
(18,500 ha) additional 1.5 PJ of primary
energy could be gained in form of biogas.
From agricultural residues about 0.4 PJ
of primary energy in form of biogas was
produced in 2009. This corresponds to
the use of 3 % of the total accumulated
amount of agricultural residues.
Increasing the use of agricultural manure
by 35 % would contribute to 4.3 PJ in
form of biogas. The biogas production
based on agricultural raw materials could
thus be increased from 4.7 PJ in 2009
to 15 PJ in 2020. In addition the biogas
production could be increased from 1.7
PJ to 1.2 PJ through a more intensive use
of organic waste. This category includes
organic waste from households, garden
and park waste, market waste, kitchen,
canteen and food waste, animal waste
and dairy waste. Total biogas production
could rise from 5.9 PJ (164 million cubic
meters of biogas equivalent) in 2009 to
16.7 PJ (464 million cubic meters of biogas
equivalent) in 2020, without competing
with the food and feed production.4
3.1.5. Business Case
In general, the Austrian feed-in law
offers excellent framework conditions by
providing investment security with its 15
to 20-years payment period guaranteed
for the tariffs, the prioritized grid access
and the purchase obligation of the grid
operator.
4 „Heat, Electricity, Fuels – Bioenergy 2020“; Aust-
rian Biomass Association, 2011; http://www.biomas-
severband.at/servicedownload/publikationen
The feed-in tariffs for biogas in 2012
(compare Table ‘Feed-In-Tariff’) are the
same as in the year before. Appliances
up to 250 kW receive 18.5 Cent/kWh,
appliances between 250 and 500 kW are
paid 16.5 Cent/kWh, and bigger biogas
appliances get 13 Cent/kWh. If heat is
also used, additional 2 Cent/kWh are
paid. The usage of waste reduces the
tariffs by 20 %. Appliances up to 250 kW
must use a minimum of 30 % manure.
An utilisation ratio of at least 60 % is
required to get a subsidised tariff. Under
these conditions new appliances are
only economical when the raw material
supply is excellent and the produced
heat is used.
3.1.6. Market Environment
Market Handbook Biogas
By the end of 2009, electricity generation
systems based on solid biomass with a
capacity of 313.4 MW, biogas plants with
a capacity of 77 MW, systems based on
liquid biomass with a capacity of 9.6
MW and plants working with landfill-
and sewage gas with a capacity of 21.2
MW were established in Austria. These
plants generated 2,566 GWh in total.
The electricity was fed into the grid and
subsidised by the Renewable Energy Act.
Additionally, 1,100 GWh of electricity 39
from black liquor and 600 GWh from
sewage sludge, carcass meal and
other renewable waste were generated
without subsidisation. In total, 4,300
GWh electricity were generated from
biomass sources.
The consumption of bioenergy increased
by 30 % from 140 PJ in 2005 to 182 PJ
 Table ‚Feed-In-Tariff‘: Feed-in tariffs for new green electricity facilities in Austria 2012
Market Handbook Biogas

Source: Energy-Control Austria, January 2012; http://e-control.at/de/market_players/re-

newables/feed-in-tariffs

in 2009 (Figure ‘Development Energy of biofuels and a share of 9 % of green

Consumption’). The heating market is
the main sales market for biomass with
40 a share of 79 %, followed by the biofuel
market with 12.4 % and the green
electricity market with a share of 8.6 %.
Assuming that the full resource-potential
will be exploited, the final consumption
of bioenergy could rise about 31 % up to
237 PJ. With estimated 76 % the heating
market will still be the primary sector
using biomass in 2020. A share of 15 %
electricity from biomass and biogas are
assumed.
The Figure ‘Development Biomass Heat’
shows that the production of heat from
biomass sources increased by about 12
% from 128.5 PJ in 2005 to 143.5 PJ in
2009, while in 2009 about 83 % of the
produced heat came from small scale
heating and 17 % from district heating.
During this period, the district heat from
biomass sources nearly doubled from
 Figure ‚Development Energy Consumption‘: Development of final energy consumption
of biomass in Austria from 2005 to 2009 and forecast potentials for 2020

Market Handbook Biogas

Figure ‚Development Biomass Heat‘: Development of production of heat from biomass in
Austria from 2005 to 2009 and forecast potentials for 2020

Source: „Heat, Electricity, Fuels – Bioenergy 2020“; Austrian Biomass Association, 2011;
http://www.biomasseverband.at/servicedownload/publikationen

41

Source: „Heat, Electricity, Fuels – Bioenergy 2020“; Austrian Biomass Association, 2011;
http://www.biomasseverband.at/servicedownload/publikationen
 Table ‚Forecast Potential‘: Forecast potential for production of heat from biomass in Austria
from 2009 to 2020

Energy Source PJ %
Wood-based 25.6 68.6
Black Liqour 1.5 4.0
Biogas 5.4 14.5
Other Solid Biomass 4.8 12.9
Sum 37.3 100.00

12.7 PJ to 24.5 PJ. The heat production level of efficiency. With the fuel amount
from small scale heating increased saved through the replacement of old
slightly from 115.8 PJ to 119.1 PJ. appliances, further 45,000 households
The development potential of heat from can be heated.
biomass sources is estimated to increase Green energy from liquid and solid
by 37.3 PJ until 2020 (Table ‘Forecast biomass and biogas increased by 67 %
Potential’) and can hence reach 181 PJ from 9.3 PJ in 2005 to 15.5 PJ in 2009.
Market Handbook Biogas

in total. The most important resource In this time period green electricity from
for a further expansion is wood with 69 solid biomass including black liquor rose
%, followed by biogas with 15 % and from 7.9 PJ to 13, while green electricity
other biomass combustibles with 13 %. from biogas increased from 1.1 PJ to 2.3
It is expected, that about 60 % of the PJ.
development potential lies in small scale When using the total potential, green
heating. The remaining 40 % will be electricity from solid and fluid biomass
covered by district heating, micro-grids and biogas could increase by about
and industrial waste heat from CHP- 34 % to 20.7 PJ by 2020 (see Figure
appliances. To reach this goal, heating ‘Development and Forecast Potentials’).
appliances with a thermal capacity of Around 55 % of the potential comes from
42 about 5,050 MW must be installed.
solid biomass and 45 % from biogas. To
Additional 500,000 households with use the full potential, CHP-appliances
an estimated heat consumption of 10 operating with solid biomass and biogas,
kW/ household could be switched from each producing 100 MW in total, need to
fossil to biomass heating. Moreover old be build.
biomass heating appliances need to
be replaced. About 140,000 outdated
heating appliances based on wood
should be replaced to reach a higher
 Figure ‚Development and Forcast Potentials‘: Development of green energy from liquid and
solid biomass and biogas in Austria from 2005 to 2009 and forecast potentials for 2020

Source: „Heat, Electricity, Fuels – Bioenergy 2020“; Austrian Biomass Association, 2011;
http://www.biomasseverband.at/servicedownload/publikationen

Market Handbook Biogas

3.1.7. Regulation
In 2011, it has already been 10 years that
the Austrian electricity market has been
liberalised. The liberalisation had been a
consequence of the Austrian accession
to the EU and its first energy package.
In Austria there are a variety of rules
and laws for CHP-plants operating with
biomass. Some of the most important
regulations are declared in the following.
The federal ‘Green Electricity Law
Austria 2012’ (Ökostromgesetz 2012)
regulates the financial support through
the feed-in tariffs, the grid access,
the acknowledgement of plants, the
obligations for applicants and plant
operators, the investment subsidies
etc. Since 2003, the ‘Green Electricity
Law Austria’ regulates homogeneous
subsidies and support schemes for the
whole of Austria.
The federal law ‘KWK-Gesetz’ (CHP
law) governs the nationwide uniform
distribution of funding the generation of
green electricity in CHP systems. The
funding is available for two purposes.
Funding for a part of the expenses for
the operation of existing and modernized
43
cogeneration installations for public
district heating, and funding as a form of
investment grants for new CHP plants.
For air and noise emissions there are
binding thresholds defined within the
federal ’Emissionsschutzgesetz für
Kesselanlagen – EG-K’ (emission law for
boiler plants in Austria).
There are numerous regulations in
 Austria that affect the operation of
heating systems based on biomass. The
most important ones are listed below.
Both norms ‘Emissionsschutzgesetz für
Kesselanlagen – EG-K’ and ‘Luftreinhalte-
VO für Kesselanlagen (LRV-K)’ are
regulating the approval, the operation,
the air emissions and the monitoring of
steam and gas generators.
The ‘Feuerungsanlagenverordnung
(FAV)’ applys to subjects to approval
and already approved appliances with a
capacity of more than 50 kW.
The ‘Abfallverbrennungsverordnung
(AVV)’ regulates combustion techniques,
emission limits and operation conditions.
The ‘Immissionsschutzgesetz-Luft (IG-
L)’ comprises limits and targets for
several pollutants.
Market Handbook Biogas
The target of the
‘Emissionshöchstmengengesetzes Luft
(EG-L)’ is the regulation of air pollutants
(NOx, SO2, NMVOC und NH3) through
the determination of national emission
limits.
Regulations and useful links:
• Green electricity law Austria 2012
(Ökostromgesetz 2012)
44
• E-Control Austria
• OeMAG – Abwicklungsstelle für Öko-
strom AG (processing and administrati-
on centre for green electricity in Ausria)
• CHP-law Austria (KWK-Gesetz Austria)
• Emissionsschutzgesetz für Kesselan-
lagen - EG-K (emission law for boiler
plants)
• Luftreinhalte-VO für Kesselanlagen
(LRV-K)
• Feuerungsanlagenverordnung (FAV)
• Abfallverbrennungsverordnung (AVV)
• Immissionsschutzgesetz-Luft (IG-L)
• Emissionshöchstmengengesetzes Luft
(EG-L)
3.1.8. Project Financing
According to outcomes from recognized
rating agencies, like Standard & Poor´s 5
and Moody´s6, Austrian markets can be
considered as safe from the perspective
of country risk. Also the reliability
and credit worthiness of the Austrian
economy is rated with best scores.
In the COFACE country risk rating,
Austria positions itself on the 5th place
of whole Europe after Luxembourg,
Norway, Sweden and Switzerland.7
According to the Corruption Perception
Index for the level of transparency
Austria took the 16th position of the
whole world.8
The IFC (International Finance
Corporation) ranks Economies on their
ease of doing business. Austria achieved
the 32nd place of 183 reviewed countries
in the ‘Ease of Doing Business’-ranking,
and can therefore be considered to be
5 Standard & Poor´s, http://www.standardand-
poors.com/home/en/eu
6 Moodys´s, http://www.moodys.com/
7 http://www.coface.com/CofacePortal/
COM_en_EN/pages/home/risks_home/count-
ry_risks/rating_table?geoarea-country=COUN_
AREA_04&crating=&brating
8 Corruption perceptions index 2011, http://cpi.
transparency.org/cpi2011/results/#CountryResults
quite well, although the rank of ’Starting a
Business’ is relatively low in consequence
of the very high administrative and
regulative requirements.9
As Austria is member of the Eurozone,
currency exchange risk for investors
coming from other member countries
of the Eurozone, is low. The average
inflation rate is with 1.8 % for the period
2005 to 2010 one of the lowest within
Europe, the European average for the
same period is 2.3%.10
The easiness of getting a credit by banks
is very much dependent on individual
project designs as the bank will assess
reliability of the chosen technology,
feedstock supply security and price
risks. The development of appropriate
measures or strategies for the use of
bioenergy is very specific. The optimal
solution for the specific situation must
consider ecological and economical
aspects as well as social aspects.
A specific project financing institution
in Austria is RENERGIE. It offers
support in financing and operation
of energy generation facilities using
renewable sources, develops projects
for renewable power and heat and
realizes the appropriate production
plants. The projects are implemented by
equity investments in selected European
markets.11
9 IFC World Bank Group – International Finance
Corporation World Bank Group, http://www.doing-
business.org/rankings
10 Wirtschaftskammern Österreich, http://wko.at/
statistik/eu/europa-inflationsraten.pdf
11 RENERGIE: Raiffeisen Managementgesellschaft
für erneuerbare Energie GmbH, http://www.rener-
gie.at/en
3.1.9. Readiness for Uptake
The expectancy and readiness for uptake
in Austria seems to be good. However,
new projects need to be planned and
implemented in a considerate and well
adapted way under the participation of
local inhabitants and stakeholders.
Renewable energy sources have a
special status in Austria. In recent
years big efforts were made to promote
green energy. As a result, 30.8 % of
the Austrian energy consumption came
from renewable sources in 2010. The
measures are diverse, there are, on the
one hand initiatives sensitizing the public
to energy issues (e. g. ‘klima:aktiv’), and
on the other hand, several subsidies as
well as suitable framework conditions
to promote renewable energies were
Market Handbook Biogas
created.12
The total turnover of investments in
renewable energy technologies reached
5.229 billion Euro in 2010, whichwas a
5.1 % increase to the previous year. The
production and service of renewable
energy appliances, offered employment
for 37.649 people in 2010 – 5,1 %
more than in 2009. The importance of
renewable energies for the national
economy is, however far bigger than just 45
the turnover and employment effects.
The ability to generate energy from
domestic sources reduces the need of
12 Source: Erneuerbare Energie in Zahlen – Die
Entwicklung erneuerbarer Energie in Österreich im
Jahr 2010; Bundesministerium für Land- und Forst-
wirtschaft, Umwelt und Wasserwirtschaft, Abteilung
Umweltökonomie und Energie; http://www.lebens-
ministerium.at/umwelt/energie-erneuerbar/ERneu-
erbare_Zahlen.html
 fossil fuel imports. Hence the national
economy will be less prone to crisis.
In a longer term the economy will gain
sustainability.13

13 Source: Erneuerbare Energie in Zahlen – Die Ent-

wicklung erneuerbarer Energie in Österreich im Jahr
2010; Bundesministerium für Land- und Forstwirt-
schaft, Umwelt und Wasserwirtschaft, Abteilung
Market Handbook Biogas

46
3.2. Germany

German Bioenergy Association (BBE)

Thomas Siegmund
Godesberger Allee 142-148
D-53175 Bonn
Tel.: +49-228 81 002-22
Email: siegmund@bioenergie.de

3.2.1. Country Score

Country Score Bavaria - Biogas (November 2011)

In the general scoring
for sector, Germany -
Bavaria is rated place
19 out of total 81. The
underlying categories
that influence this re-
sult are displayed in
the bar chart.

Market Handbook Biogas

Country Score Bavaria - Biomethane (November 2011)

In the general scoring

for sector, Germany -
Bavaria is rated place
22 out of total 81. The 47
underlying categories
that influence this re-
sult are displayed in the
bar chart.
 3.2.2. Basic Data
Germany, officially the Federal Republic
of Germany, is a federal parliamentary
republic in Europe, consisting of
sixteen federal states (see Graph ‘Map
Germany’). The capital and largest city
is Berlin. Germany covers an area of
357,104 km² and is therewith one of the
largest countries in Europe, located in a
temperate climate zone with an average
of -0.5 degree Celsius in January and 17
degree Celsius in July in average.1
Purchasing power to allow higher prices
for green electricity can generally be
seen as positive. While the GDP real
growth rate stagnated slightly with -0.1%
between 2008 and 2010, GDP in 2010
was still € 118 per capita, which makes
Germany one of the strongest economies
Market Handbook Biogas
in Europe with solvent inhabitants . The
population density of 229 inhabitants/
1 Federal Statistical Office, www.destatis.de
Graph ‚Map Germany‘: Federal
States of Germany
48
km² on average is considered to be
attractive, providing sufficient sales
potential even on regional scale, although
the population density in eastern and
northern parts of Germany is lower
compared to western and southern
regions.
Useful links:
Facts and Figures:
• Federal Statistical Office
• GTAI - Germany Trade & Invest
• German Farmers Union
• German Association of Energy and
Water Industries
• Reegle
2.2.3. Energy Policy
The German government aims at reaching
a share of renewable energy sources of
20% in the final energy consumption, and
of 35% in the electricity sector by 2020.
The RES-share in Germany’s final energy
consumption is supposed to rise to up to
80% in 2050. Due to its characteristics
as a storable feedstock and a flexible
energy supply, bioenergy will play a
key role in this strategy. Amongst the
different bioenergy technologies, the
amount of electricity produced by biogas
plants (including sewage and landfill gas)
is planned to be raised from 13.9 TWh in
2010 to 23.4 TWh in 2020, requiring an
increase of installed capacity from 2.5
GW to 3.8 GW in the same period.2
2 Federal Ministry for the Environment, Nature
Conservation and Nuclear Safety, http://www.bmu.
de/files/pdfs/allgemein/application/pdf/nationaler_
aktionsplan_ee.pdf
In addition to the proposed targets
and measures for biogas electricity,
the German government also aims at
feeding 6 billion Nm³ biomethane into
the natural gas grid in 2020, which
requires investments into 1,200 to 1,800
biomethane upgrading plants with an
average capacity of 4 to 6 MWh. This
corresponds to an annual increase of
120 – 150 plants.3
The political will to develop the biogas
sector can be seen as quite favourable,
as the benefits of biogas are recognized
and biogas is seen as a key technology
to increase the market share of RES
in general. Biogas can provide both
base load and peak load electricity,
which makes it a valuable option to
balance fluctuating RES energies, like
wind power and PV. The proposed
measures to reach these targets, both,
theoretically described in the nREAP
but also practically experienced, are
considered to range from very good to
sufficient, however, there is still room
for improvements.
With the feed-in law in Germany the
government introduced an excellent
support scheme with fixed feed-in tariffs
for different feedstocks and capacities,
long-term payment periods and
guaranteed grid access and regulated
grid connection rules. The feed-in law is
amended on a regular basis, to adjust the
tariffs to actual market developments
and needs. Since 2009, also incentives
for biomethane upgrading, if used for
electricity generation, are set within the
3 Dena – Biogaspartner, http://www.biogaspartner.
de/index.php?id=10105&L=1\\%27
EEG. The amendment of the EEG in 2011
introduced additional options to invest
into biogas storage facilities and to
integrate biogas into the energy market.
With rising success of the biogas sector in
the electricity market, different concepts
and strategies were introduced, ranging
from small scale biogas on-site production
plants fed with agricultural residues from
the farm, to large scale, industrial biogas
and biomethane plants utilizing energy
crops from larger catchment areas. At
policy-making-level, this led to different
viewpoints concerning which strategy
was best to follow. Eventually, this
resulted in constant public discussions
on changing tariffs and regulations –
and therewith to rising uncertainty and
decreasing confidence in the stability of
policy frameworks on the investor-side.
Market Handbook Biogas
In the heat market biogas does not play
a role so far, although some utilities and
energy traders started to provide special
tariffs for natural gas with a low blend of
biomethane (5-10%). Biogas for heat is
not directly supported, but is eligible to
be used for fulfilment of the renewable
heat obligation for new houses. However,
the renewable heat obligation law does
not have a measurable impact on the
market so far.4 49
Until today, biomethane is also not
very common in the transport sector.
Biomethane can be used to fulfil the
biofuel quota obligation5 of the mineral oil
4 Federal Ministry for the Environment, Nature
Conservation and Nuclear Safety, http://www.erneu-
erbare-energien.de/erneuerbare_energien/gesetze/
eeg/doc/47585.php
5 Biofuels Quota Act, http://www.gesetze-im-inter-
net.de/bimschg/index.html
 industry, but it cannot yet compete with
B100 and bioethanol fuels, even though
it remains exempted from the energy
tax until 2015. If used as transport
fuel, biomethane, further on, has to
meet the sustainability requirements
of the biofuels sustainability ordinance
‘BioKraft-NachV’.6
Useful Links:
Institutions:
• RES Strategy, EEG and EEWärmeG =>
Federal Ministry for the Environment,
Nature Conservation and Nuclear Safety
• Biofuels Strategy => Federal Ministry
of Food, Agriculture and Consumer Pro-
tection
• Biofuels Sustainability Ordinance =>
Federal Office for Agriculture and Food
Market Handbook Biogas
• Bioenergy F&E and Marketing => Fe-
deral Agency for Renewable Ressources
Associations:
• BBE - German Bioenergy Association
• FvB - German Biogas Association
• Biogas Council
6 Biofuels Sustainability Ordinance, http://www.
gesetze-im-internet.de/biokraft-nachv/index.html
50
3.2.4. Feedstock
The infrastructure for both, producing
and disseminating and utilizing biogas is
excellent. In Germany a dense road and
rail network exists, allowing efficient
feedstock deliveries to the biogas plants
during the whole year. A sophisticated
and well-established separation and
collecting system for bio-waste enables
the development of a huge bio-waste
potential. At ‘the other end of the pipe’
with approximately 1.7 million km length
(66% low voltage, 28% medium voltage
and 6% high voltage lines), a dense and
country-wide electricity grid is available
for electricity feed-in, though in some
remote areas with a high density of
RES electricity facilities, capacities
for additional electricity feed-in can
be limited. The German government
therefore, aims at extending grid
capacity in the short-term. Also a
natural gas grid for biomethane feed-in
is available with a total length of more
than 443,000 km (thereof 27% low
pressure, 41% medium pressure and
32% high pressure pipelines).7
2.3% of Germany’s surface is used for
agriculture offering a great theoretical
potential for agricultural feedstock supply
for the biogas sector. Considering a total
population of 81 million inhabitants,
Germany has 2,300 m² available farm
land (including grassland), resp. 1,460 m²
arable farm land (without grassland) per
capita.8 In addition, with approximately
7 German Association of Energy and Water Indus-
tries, http://www.bdew.de/internet.nsf/id/DE_Ener-
giedaten
8 German Farmers Union, www.situationsbericht.de
40 million private households9 and a
strong biomass processing industry,
energy crops and bio-wastes in Germany
offer a considerable potential for biogas
and biomethane production.
Therefore, the feedstock potential from
manure, energy crops and bio-wastes
for biogas in Germany is high. The
dominating energy carriers for biogas,
however, are manure and energy crops.
In 2010, manure was with 46% the
most utilized feedstock input in terms
of mass, but only delivered 11% of the
total energy output from biogas, due
to the low energy content of manure.10
In Germany, the share of manure in
the digester is higher, the smaller the
biogas plant is: in biogas plants with
an installed electric capacity of <70 kW
the share of manure was 70% in 2010,
while in biogas plants >500 kW installed
electric capacity it was less than 30%,
according to the EEG monitoring report
2011 of DBFZ.
Still, manure is an attractive energy
carrier. The EEG 2012 focuses on the
utilization of manure in biogas plants
and provides attractive feed-in tariffs
especially for manure inciting small,
farm-sited biogas plants. In view of
the agricultural structure, the manure
potential is unequally distributed, as
there are areas with a high share of
livestock farming and areas with more
crop cultivating farms. The highest
9 Bundeszentrale für politische Bildung, http://
www.bpb.de/wissen/GLSOS3,0,0,Bev%F6lkerung_
und_Haushalte.html
10 DBFZ, http://www.dbfz.de/web/fileadmin/user_
upload/Userupload_Neu/Stromerzeugung_aus_Bio-
masse_Zwischenbericht_Maerz_2011.pdf
share of farms, which have at least
150 cattle in stables (hence, providing
sufficient manure to operate a small
biogas plant of 30 kW capacity), can be
found in Lower Saxony (> 3,500 farms),
Schleswig-Holstein (>2,000 farms),
North Rhine-Westphalia (>1,500 farms)
and Bavaria (>1,100 farms), while the
lowest potential – neglecting the cities
of Berlin, Hamburg and Bremen – can be
found in Rhineland-Palatinate, Saarland,
Saxony and Saxony-Anhalt.
Considering the theoretical biogas yields
of all livestock (cattle, pigs and poultry),
the highest potentials lie in the same
regions of Lower Saxony (88 million m³
theoretical biogas yields), Bavaria (83
million m³), North Rhine-Westphalia
(57 million m³) and Schleswig-Holstein
(30 million m³), accordingly. Normalized
Market Handbook Biogas
by land area, the order only changes
slightly, starting with Schleswig-Holstein
(1,900 m³/km²), Lower Saxony (1,800
m³/km²), North Rhine-Westphalia (1,600
m³/km²) and Bavaria (1,100 m³/km²).11
However, it must not be forgotten that
biogas plants do not need to be operated
with manure only, but as most common,
by a feedstock mix. Since 2004, the use
of energy crops was incited by the EEG as
well, which led to a mass share of 45% in 51
2010, almost equal to the manure share.
However, due to the much higher energy
content of energy crops in relation to
manure, it makes up almost 80% of
the total biogas production. In general,
11 Federal Statistical Office, http://www.destatis.
de/jetspeed/portal/cms/Sites/destatis/Internet/DE/
Content/Statistiken/LandForstwirtschaft/Landwirt-
schaftszaehlung2010/Ergebnisse,templateId=render
Print.psml#3
 there was a steady increase of energy
crop cultivation on farm land, over the
past years. After a small decline in 2008,
cultivation areas for renewable resources
increased significantly to 2.28 million
ha, this reflected 19% of Germany’s
total arable farm land in 2011. Beneath
a small share for industrial use, 1.96
million ha were used for energy crops.
Figures concerning the land area used
for energy crop cultivation to produce
biogas vary between 0.8 million ha12 and
1.1 million ha.13
Overlooking the agricultural structure
in Germany, in most regions (federal
states) the available farm land exceeds
the theoretically needed area of 0.2
ha per inhabitant to produce sufficient
food, which indicates a theoretical
potential for non-food crop production.
Market Handbook Biogas
Except for forest-rich regions of Hesse,
Saarland and North Rhine-Westphalia
and the cities of Berlin, Hamburg and
Bremen where there is less than 0.2 ha/
inhabitant available, the available farm
land per inhabitant ranges from 0.21
ha/inhabitant in Rhineland-Palatinate
to 0.84 ha/inhabitant in Mecklenburg-
Western Pomerania. This view of course
considers neither the kind of crops grown
in a region, nor any trade activities on
52 regional, national and global scale and
should hence only be used as a rather
theoretical indicator.14
12 FNR, http://mediathek.fnr.de/grafiken/daten-
und-fakten/anbauflache-fur-nachwachsende-rohstof-
fe-2011-4.html
13 DBFZ, http://www.dbfz.de/web/fileadmin/user_
upload/Userupload_Neu/Stromerzeugung_aus_Bio-
masse_Zwischenbericht_Maerz_2011.pdf
14 Federal Statistical Office, www.destatis.de
Regions with the largest area of farm land
(grassland and arable land) in total, are
Bavaria (3.5 million ha), Lower Saxony
(2.9 million ha), North Rhine-Westphalia
(1.7 million ha), Brandenburg (1.5 million
ha) and Mecklenburg-Western Pomerania
(1.5 million ha).
Based on improved production efficiency,
advanced growing and processing
technologies and developments in plant
breeding, crop yields were raised by 1
to 1.5% each year. If this development
continues in the future, approximately
150,000 to 200,000 ha of farm land could
be used additionally per year, without
restricting food production.15 By doing
so, the available farm land for energy
crop production could be doubled from
2 million ha to approximately 4 million
ha without affecting food supply.16
The most common energy crop in 2010
was corn with 76% mass share of all
used energy crops, followed by grass
silage (11%), wheat (whole plant, 7%)
and wheat grain (4%). Sugar beet plays
with only 1% a minor role so far, but is
seen to be an upcoming and promising
energy carrier in the future.17 Same
is true for cup-plant (Lat.: Silphium
Perfoliatum), which is so far grown on
200 ha for research only, but is promising
mass and biogas yields comparable to
those of corn.
15 Situationsbericht 2011/12 – Trends und Fakten
zur Landwirtschaft, www.situationsbericht.de
16 German Bioenergy Association, www.bioenergie.
de
17 DBFZ, http://www.dbfz.de/web/fileadmin/user_
upload/Userupload_Neu/Stromerzeugung_aus_Bio-
masse_Zwischenbericht_Maerz_2011.pdf
Bio-wastes (7% mass share and 7% of
the biogas yields) and residues from
industry and agriculture (2% in both
mass share and biogas yields) play a
minor role in the German biogas market
so far.18 Total available potential is stated
to be 12.2 million tons /year.19
Useful Links:
Facts and Figures:
• Federal Statistical Office
• German Farmers Union
• Federal Agency for renewable resour-
ces
• German Biomass Research Centre
• EUROSTAT
Associations:
• FvB - German Biogas Association
• Biogas Union
3.2.5. Business Case
Although prices for fossil energy carriers
in the heat, transportation and electricity
market rose steadily within the last
decade, break-even of bioenergy is not
yet reached, because production costs of
bioenergy increased as well due to rising
feedstock prices. The AMI price index
for the 13 most relevant agricultural
feedstock produced in Germany ranges
on a high level and increased steadily
from 98 points in October 2009 to 138
points in October 2011 (reference year is
18 DBFZ, http://www.dbfz.de/web/fileadmin/user_
upload/Userupload_Neu/Stromerzeugung_aus_Bio-
masse_Zwischenbericht_Maerz_2011.pdf
19 EUROSTAT, http://ec.europa.eu
2006 with 99.9 points).20
Also fossil fuels, of which a significant
share needs to be imported, experienced
a jump in prices, especially since 2003.
Compared to the reference year 1991
(index = 100) the price index for imported
crude oil rose to 376 points in 2008
which reflects an increase by 276% in
this period. Between January 2009 and
April 2010 prices rose by 90%, which is
a strong increase for this short period of
time. The price development of coal is
comparable to this, showing an increase
from 100 points in 1991 to 248 points in
2008, with fewer fluctuations however.
The main driver was an increased coal
demand in the BRIC countries and the US.
The higher fuel procurement costs are
reflected in increased electricity prices
for households, too, which rose from €
Market Handbook Biogas
40.67 per month for a German reference
household (3.500 kWh/year) in 2000 to
€ 67.7 per month in 2009. The highest
share of the increase in electricity prices
comes from generation, transportation
and sales with 61%. Increased costs
of RES stemming from the EEG-feed-
in-tariffs, which are allocated to all
electricity consumers, only contribute
11% to this increase.21
Although prices for fossil based energy 53
grew significantly within the last decade,
biogas and biomethane in Germany still
require support-systems to be
20 AMI, http://www.ami-informiert.de/ami-maerkte/
ami-weitere-maerkte/ami-maerkte-agrarwirtschaft/
meldungen/meldungen-single-ansicht/article/ami-
rohstoff-index-bleibt-fest-gestimmt-1.html
21 Federal Environment Agency, http://www.um-
weltbundesamt-daten-zur-umwelt.de/umweltdaten/
public/theme.do?nodeIdent=3605
 competitive with natural gas, coal, fossil
oil and nuclear energy – depending on
the market, biogas is used in. In view of
energy crops, there is a close correlation
between energy- and agricultural prices,
or between purchasing power of the food
sector and the demand of the bioenergy
industry, which is dependent on crude
oil prices. With high crude oil prices, the
utilization of wheat, oil seeds or sugar
plants can be cheaper than fossil fuels
in terms of oil equivalents. This is why
high energy prices trigger prices for
agricultural products and therefore lead
to increased biomass fuel procurement
costs for bioenergy plants.22
Prices for biogas electricity vary
significantly due to different plant
sizes, feedstock used, and technologies
applied. In general, the feed-in tariffs
Market Handbook Biogas
of the EEG reflect total production
costs, from which spot market prices
for conventional electricity must be
subtracted to calculate the extra costs
of biogas-electricity. Feed-in tariffs
for biogas ranged between 6 ct/kWh
to 25 ct/kWh in 2012. Average extra
costs of all bio-based electricity (solid
biomass + biogas) in 2011 was 12.79
ct/kWh according to BDEW23 while the
spot market price for electricity ranged
54 between 5 and 5.5 ct/kWh.24
To enable a profitable operation of
22 DBV, German Farmers Union, www.situationsbe-
richt.de
23 BDEW,German Association of Energy and Water
Industries, http://bdew.de/internet.nsf/id/3564E9
59A01B9E66C125796B003CFCCE/$file/BDEW%20
Energie-Info_EE%20und%20das%20EEG%20
%282011%29_23012012.pdf
24 EEX, www.eex.com
bioenergy and biogas plants in spite of
this, German government introduced
the EEG in 2000, which guarantees a
fixed tariff for produced electricity fed
into the electricity grid. It was amended
three times already to adjust tariffs and
regulations to market developments. The
tariffs are differentiated by technology,
capacity and feedstock used and will be
paid for a 20-year period. From 2013
on, tariffs for new biogas plants will
be lowered by 2% every year, to incite
technology and efficiency improvement.
Since 2012, plants up to 150 kWel
capacity are eligible to receive a tariff
of 14.3 ct/kWh, of 12.3 ct/kWh for a
capacity of up to 500 kWel, of 11 ct/kWh
for a capacity of up to 5 MWel and of 6
ct/kWh for a capacity of up to 20 MWel.
In addition to this basic remuneration,
a feedstock bonus is granted ranging
between 4 and 8 ct/kWh. Eligible
feedstocks for this bonus are categorized
into two classes and again differentiated
by capacity. A list of eligible feedstock for
each class can be received at the German
Biogas Association.25 For feedstocks of
class II, the bonus is 8 ct/kWh for all
installed capacities up to 5 MWel. For
feedstocks of class I the bonus is 6 ct/
kWh for a capacity of up to 500 kWel, 5
ct/kWh for up to 750 kWel capacity and
4 ct/kWh for a capacity up to 5 MWel.26
25 FvB, German Biogas Association, http://www.
biogas.org/edcom/webfvb.nsf/id/DE_Einsatzstoffe_
nach_Biomasseverordnung/$file/11-12-20_Einsatz-
stoffe_final.pdf
26 Federal Ministry for the Environment, Nature
Conservation and Nuclear Safety, http://www.erneu-
erbare-energien.de/erneuerbare_energien/gesetze/
eeg/doc/47585.php
A special support is granted to small-
scale biogas plants <75 kWel fed with
manure. Since 2012, they will receive a
feed-in tariff of 25 ct/kWh if they utilize
at least 80% manure. Biogas plants up to
500 kWel using bio-wastes only receive
a tariff of 16 ct/kWh. For capacities up
to 20 MWel, it is still 14 ct/kWh.
For the upgrading of biogas to
biomethane, another bonus of 3 ct/kWh
applies for plants which produce 700
Nm³/h, of 2 ct/kWh for plants with a
capacity of 1,000 Nm³/h and 1 ct/kWh
for biogas plants which upgrade up to
1,400 Nm³ biomethane per hour.
The eligibility of receiving the tariffs is
linked to several requirements, amongst
those, a cap of 60% for corn used as
input material and the need to operate
at least 60% in CHP mode. If this is not
met, the plant operator does not receive
any feed-in tariff for the generated
electricity and it has to be sold at the
spot market instead. In this case, it is
however still supported by the newly
introduced ’market premium model’
within EEG 2012. Same is true for biogas
plants >750 kWel from 2014 on, which
do not get any fixed tariff, but have to
apply the market premium model.
With the introduction of the market
premium model within EEG 2012,
biogas electricity shall be introduced
to the energy market. Once a month, a
biogas operator can choose whether he
wants to receive the fixed feed-in tariff
according to his biogas plant design, or
whether he wants to sell it at the spot
market within the market premium
option. With the market premium model,
the biogas plant operator receives a
payment equal to the feed-in tariff he
would have received instead, deducted
by the spot market price and added by
a management premium (0.3 cent/kWh
in 2012, reduced to 0.225 cent/kWh in
2015).
Another new support design within EEG
2012 is the introduction of a flexibility
premium, which shall incite the operation
of a biogas plant in accordance to daily
electricity demand. It means, that a
biogas plant operator receives €130
per year for each kW capacity that is
installed in addition to the existing plant
for a 10 year period. For instance, if the
capacity was 500 kWel before and the
operator adds another 250 kWel, he
would get (250 kW x €130) x 10 years
Market Handbook Biogas
= €325,000. Instead of running a 500
kW biogas plant at full capacity 24/7,
regardless of real electricity demand,
the operator can now run his plant with
e.g. 50% at times of low power demand
(e.g. 250 kWel) and 100% in times of
peak demand (750 kWel). Of course this
also requires storage facilities for the
produced biogas. In sum, the average
electricity generation per month must
not be higher than the permitted basic 55
output (of 500 kWel). This flexibility
premium only applies to biogas plants
which are supported by the market
premium model.
Besides the operational support for
biogas plants, there are additional
investment subsidies available in form
of grants and long-term, low-interest
loans. Conditions and requirements
 differ from federal state to federal state
and have to be asked for at local banks
or authorities. The KfW-bank provides
beneficial financing conditions as well.
Useful links:
Facts and figures:
• AMI - Agricultural Market Information
Company
• Federal Ministry of Economics and
Technology
• Federal Environment Agency
• German Farmers Union
• Association of German Energy and
Water Industries
• Leipzig Energy Exchange EEX
Support schemes:
Market Handbook Biogas
• Federal Ministry for the Environment,
Nature Conservation and Nuclear Safety
• KfW-Bank
• Federal Ministry of Economics and
Technology
• BINE
• Federal Agency for Renewable Resour-
ces
Associations:
56 • BBE - German Bioenergy Association
• FvB - German Biogas Association
3.2.6. Market Environment
With 5,900 biogas plants in operation
and 2,300 MW installed electric capacity
in 2010, Germany is the most developed
biogas market in the world. The German
Biogas Association estimates that by
end of 2012 up to 7,400 biogas plants
will provide a capacity of 2,900 MW
(see Figure ‘Market Development’).27
Compared to the market conditions in
2006, the number of biogas plants for
CHP as well as the total electric capacity
installed doubled by 2010. There are,
however, periods of low investment
activity at times when the feed-in
systems is being amended.
The average electric capacity of all
installed biogas plants in 2010 was 380
kW, although those plants newly built
in 2010 ranged at 300 kW in average,
which indicates the trend to small and
medium sized systems (see Figure
‘Installed Capacity’).28 This is due to the
incentives of the amended EEG in 2009,
which aimed at fostering the market
development of plants <500 kW. Since
2009, market development shifted to
capacities below 500 kW, while in 2008
still more than 60% of the build systems
ranged above 500 kW. Also today, large
scale biogas plants >500 kW capacity
are still being implemented of course.
27 German Biogas Association, http://
www.biogas.org/edcom/webfvb.nsf/id/DE_
Branchenzahlen/$file/11-11-15_Biogas%20Bran-
chenzahlen%202011.pdf
28 DBFZ, http://www.dbfz.de/web/fileadmin/user_
upload/Userupload_Neu/Stromerzeugung_aus_Bio-
masse_Zwischenbericht_Maerz_2011.pdf
 Graph ‚Market Development‘: Market development of biogas plants in Germany
Source: FvB German Biogas Asssociation 2011
Overlooking the regional allocation,
the federal states of Bavaria (2,030)
Lower Saxony (1,073) and Baden-
Wuerttemberg (709) provided the
highest number of biogas plants in 2010,
while the strongest growth in terms of
new installations was seen in Bavaria
(339 in 2010), Lower Saxony (200) and
Schleswig-Holstein (105) (see Figure
‘Map Biogas Plants’). In view of installed
electric capacity, Lower Saxony leads the
market development with 550 MW (522
kW on average), followed by Bavaria
with 548 MW (270 kW on average) and
Schleswig-Holstein with 152 MW (400
kW on average).
Market Handbook Biogas
The same order applies for the installed
capacity per available farm land, which is
approximately 200 kW/1,000 ha for Lower
Saxony, 160 kW/1,000 ha for Bavaria and
140 kW/1,000 ha for Schleswig-Holstein.
German total average is at approx. 120
57
kW/1,000 ha.
The Figures illustrate the high
concentration of biogas plants in Lower
Saxony and the southern regions of
Germany. With regards to plant size,
there are predominantly small and
medium sized biogas plants installed
in the southern regions (<325 kW on
average), while in the northern and
 Graph ‚Installed Capacity‘: Installed electric capacity per 1,000 ha farm land
Market Handbook Biogas

eastern parts of Germany (Lower 65% of the biogas plants (considered

Saxony, Schleswig-Holstein, Mecklen-
burg-Western Pomerania Brandenburg
and Saxony-Anhalt) medium to large
58 scale installations prevail. This is
mainly due to the different agricultural
structure with rather small and medium
sized farms in the south and medium to
large sized farms in the east and north
of Germany.
Usually the biogas is used in combustion
engines in CHP plants, with gas
engines prevailing in approximately
in a monitoring report of the German
Biomass Research Centre DBFZ), while
24% use pilot injection engines. 10% are
reported to make use of a combination
of both. Generally it can be said, that
gas engines are used in medium to large
sized biogas plants (>250 kW electric
capacity), while pilot injection engines
are most common in facilities below 500
kW electric capacity.
Concerning electricity generation, in
2010 the 5,900 biogas plants produced
 Graph ‚Map Biogas Plants‘: Allocation of biogas plants in Germany
Source: DBFZ 2011
approximately 15.6 TWh electricity,
which corresponds to 2.5% of the
electricity demand in Germany. For 2011
the increase is expected be around 2.5
TWh to 18 TWh in total (3.1% of electricity
demand in Germany). Compared to the
national target of providing 23.4 TWh
electricity from biogas in 2020, 67% of
this target were already met in 2010.
In addition, according to the real power
generation of 15.6 TWh in 2010 it is
assumed that, under consideration of
conversion and heat use efficiencies,
Market Handbook Biogas
approx. 5.8 to 6.7 TWh heat were
provided to external users by biogas
CHP plants, which makes up 29 – 34%
of the national target for biogas heat in 59
2020 (19.7 TWh or 1,692 ktoe).29
Among the 2,300 installed biogas plants
in 2010, about 48 biomethane upgrading
plants were registered with a total
capacity of 338 MW of which 17 started
29 Federal Ministry for the Environment, Nature
Conservation and Nuclear Safety, http://www.bmu.
de/files/pdfs/allgemein/application/pdf/nationaler_
aktionsplan_ee.pdf
 operation in 2010 according to DBFZ.
In 2010, most biomethane upgrading
facilities were situated in Lower Saxony
(10 plants with a total capacity of 4,255
Nm³/h and an average capacity of 426
Nm³/h), Baden-Wuerttemberg (8 plants,
3,040 Nm³/h total capacity, 380 Nm³/h
average capacity), Bavaria (7 plants,
4,755 Nm³/h total capacity, 679 Nm³/h
average capacity) and North-Rhine
Westphalia (7 plants, 3,240 Nm³/h total
capacity, 459 Nm³/h average capacity),
while the highest capacities can be
found in the eastern parts of Germany
in Mecklenburg-Western Pomerania (1
plant, 5,200 Nm³/h total capacity, 5,200
Nm³/h average capacity), Brandenburg
(4 plants, 4,870 Nm³/h total capacity,
1,280 Nm³/h average capacity) and
Saxony-Anhalt (5 plants, 6,755 Nm³/h
Market Handbook Biogas
total capacity, 1,355 Nm³/h average
capacity).
According to the German Energy Agency
(dena), another 29 biomethane upgrading
plants started operation until January
2012, summing up to 77 installations in
total. It is expected, that until the end
of 2012 approximately 133 biomethane
upgrading systems will feed 86,000 Nm³
biomethane per hour into the grid. In
view of planned projects, the amount of
60 biomethane plants in operation could be
increased to 147 in total, then feeding-
in 94,000 Nm³ biomethane per hour.
Projected to the whole year this would
make 7.5 billion kWh biomethane per
year, which equals the heat demand of
375,000 four-persons-households with
an average demand on natural gas
of 20,000 kWh, or to satisfy the fuel
demand of 540,000 natural gas vehicles
with a range of 20,000 km each.30
Compared to the voluntary target of the
German government to feed 60 billion
KWh biomethane into the grid in 2020,
only 12.5% would be reached in 2013.
To reach the 2020-target, approx. 1,200
to 1,800 new biomethane plants with a
total investment volume of €10–12 billion
will be needed.
The vast majority of the biomethane
upgrading facilities was planned and
built as such, only a handful CHP-plants
have been retrofitted so far. The dena,
however, expects that the conversion
of CHP plants to biomethane upgrading
and feed-in facilities will become more
and more important. Until today, only
three biomethane plants are directly
producing for the transport sector, while
the others mainly use their product
for the combined production of heat
and electricity. A part of the produced
biomethane is also sold at the market
as natural gas substitute to be blended
with natural gas to be sold at natural gas
pumps in the transport sector.
The business development of the biogas
industry shows a strong growth in
recent years. While total turnover in
2006 summed up to €1 billion31, it grew
to €5.1 billion in 2010 and is expected to
having reached €6.1 billion in 2011.32 The
30 Dena, http://www.biogaspartner.de/index.
php?id=13256&L=1%27%60%28[{^~
31 AEE, http://www.unendlich-viel-energie.de/up-
loads/media/20_Renews_Spezial_daten_fakten_bio-
gas_nov09_online.pdf
32 German Biogas Association, http://
www.biogas.org/edcom/webfvb.nsf/id/DE_
Branchenzahlen/$file/11-11-15_Biogas%20Bran-
chenzahlen%202011_eng.pdf
German Biogas Association states that
in 2010 there were 39,100 jobs created
in the biogas sector, to be increased to
46,000 jobs in 2011. Several universities
and training and qualification facilities
already provide dedicated study paths for
different job profiles in the biogas sector
to satisfy the rising demand for skilled
staff. In addition, biogas companies
have started to train future employees
‘on the job’.
According to the rapid market develop-
ment and strong business environment,
there is a recognizable competition
amongst turn-key providers of bio-
gas plants and related equipment
suppliers, though there are different
specializations recognizable in terms of
plant size, technology or feedstock used.
The database of the German Biogas
Association at www.biogas.org lists
about 257 technology providers (turn-
key and equipments for different parts
of a biogas system) and 171 companies
doing business in services, investments
and consultancy. 33 companies are
specialized in energy crop growing. After
developing German markets, a growing
number of biogas companies have
started or increased their international
business activities by exporting or
founding international subsidiaries. The
export rate in 2010 was 10%, but is
expected to have grown to 25% in 2011,
which also reflects the high demand on
international markets for mature and
proven biogas technology.
Useful links:
Facts and Figures:
• German Biogas Association FvB
• DBFZ - German BiomassResearch
Centre
• dena - German Energy Agency
Market reports:
• DBFZ: Stromerzeugung aus Biomasse,
Zwischenbericht März 2011
• BMU: Renewable energy in figures
2011
• BBE, Der Bioenergiemarkt in Zahlen
2011
List of projects and companies:
• German Energy Agency, list and goog-
le map of biomethane projects in Ger-
Market Handbook Biogas
many and Europe
• German Biogas Association, compre-
hensive and value-chain-differentiated
list of biogas and biomethane technolo-
gy providers
• German Energy Agency, value-chain-
differentiated list of biomethane techno-
logy providers and project developers
Associations:
• German Biogas Association FvB 61
• BBE - German Bioenergy Association
• Biogas Council
• Biogas Union
• EBA European Biogas Association
• AEBIOM - European Biomass Associa-
tion
 3.2.7. Regulation
The financial support of the feed-in law
(EEG) for biogas and biomethane used
in CHP is complemented with regulations
for grid access, grid transmission and
sharing of grid connection costs. For the
electricity grid, rules are defined within
the feed-in law itself, while biomethane
feeding-in is regulated by several
ordinances, as for instance GasNZV,
GasNEV, ARegV, Strom NEV etc. These
regulations oblige grid operators to
feed RES-electricity and biomethane
into their grid, to extend their grid if
required and to transmit RES electricity
with priority through the grid. Costs for
the connection of the biogas plant to the
nearest feasible connecting point have to
be covered by the biogas plant operator.
Market Handbook Biogas
No regulation in form of a direct quota
obligation is implemented. District heat
based on biogas CHP, however, is eligible
under the renewable heat obligation for
new buildings within EEWärmeG. If the
RES-H quota is fulfilled with biogas,
at least 30% of the heat demand has
to be covered. This could become an
attractive market, as within EEG, biogas
is obliged to operate at least 60% CHP.
In case new biogas plants do not operate
62 with at least 60% CHP, they have to sell
the electricity at the spot market rather
than receiving fixed tariffs, but still it is
supported up to the total amount of the
feed-in tariff they would have received
instead (feed-in tariff – spot market
price +management premium).
The approval of biogas and biomethane
plants by authorities is not considered
to be a barrier. With approximately 3
months on average for biogas plants
<500 kW installed electric capacity,
the approval period –preparing the
documents until the final approval – is
adequate. Same is true with 5 months
on average for biogas plants with >500
kW installed electric capacity. But of
course the approval period can vary
from authority to authority, depending
on their work load, skilled personnel or
local conditions.
For approval, several emission thres-
holds have to be fulfilled; amongst
them are emissions into the air, odour
emissions and noise. Requirements to
reduce emissions into the air depend
on whether the biogas plant needs an
approval according to the 4th Ordinance
for the Implementation of the Federal
Immission Control Act (4th BImSchV) or
not. If a biogas project falls under the
scope of the 4th BImSchV is dependent
on the amount, kind and source of the
utilized feedstock as well as the thermal
capacity of the plant.
If this is the case, the biogas plant
has to actively undertake measures to
guarantee that the emissions into the
air do not exceed given thresholds,
which are CO 1 g/m³, NOx 0.5 g/m³,
dust 0.2 g/m³, SO2 0.3 g/m³ and 0.6
g/m³ for Formaldehyde. If no approval
according to 4th BImSchV is required,
rules of the Technical Instructions on Air
Quality Control (TA Luft) apply, saying,
that total immissions to housings must
not exceed thresholds. So it may be
that a biogas plant does not need to
reduce emissions, if the total impact
for surrounding households does not Useful Links:
exceed the thresholds. Regulations:
Concerning noise emissions there are • Feed-in Law EEG
binding thresholds defined within the
Federal Immission Law BImSchG. For • EEWärmeG
biogas plants, which do not require • GasNZV
an approval according to 4th BImSchV,
• GasNEV
same thresholds can be applied by
authorities. Thresholds vary in relation • ARegV
to land category (see Table ‘Emission • Strom NEV
Thresholds’).
• 4th BImSchV
The Federal Immission Law also
regulates thresholds for odour emissions • Ordinance on the Utilisation of Biowas-
of biogas plants. For biogas plants, which tes
do not require an approval according • TA Luft
to 4th BImSchV, same thresholds can
• TA Lärm
be applied by authorities. Depending
on land category, different thresholds Institutions:
apply: in mixed area, odour must • Federal Ministry for the Environment,
not occur in surrounding houses in

Market Handbook Biogas

Nature Conservation and Nuclear Safety
a minimum distance of 300m more
often than 10% of the annual hours. • Federal Environment Agency
In commercial/industrial areas the • German Energy Agency
threshold is 15% of annual hours. In
Associations:
the outskirt areas, odour immissions of
up to 15 to 22% of annual hours are • FvB - German Biogas Association
allowed, for agricultural housings it may • Biogas Union
be higher.
• Biogas Council

63
Table ‚Emission Thresholds‘: Noise emission thresholds in different areas

Area Industrial Comm- Mixed General Pure Around

ercial residential residential hospitals

Day 70 dB(A) 65 dB(A) 60 dB(A) 55 dB(A) 50 dB(A) 45 dB(A)

Night 70 dB(A) 50 dB(A) 45 dB(A) 40 dB(A) 35 dB(A) 35 dB(A)

Presentation of Doris Einfeldt, http://www.biogas-infoboard.de/pdf/Einfeldt_AH_v3.pdf

 3.2.8. Project Financing
Investments into German markets are
‘safe’ from a country risk perspective,
according to established rating agencies.
Reliability and credit worthiness of the
German economy is rated with best scores
at Standard & Poor’s33 and Moody’s.
In the COFACE country risk rating34
Germany positions itself at the top of the
score same as the Corruption Perception
Index for the level of transparency.35
The ease of doing business is seen to be
quite well in Germany by IFC World Bank,
although starting a business is ranked
relatively low due to high administration
and regulation requirements.36
As Germany is member of the Eurozone,
currency exchange risk within this zone,
that is to say for investors coming from
Market Handbook Biogas
other member countries of the Eurozone,
is low. The average inflation rate of 1.7%
for the period 2005 to 2010 is one of the
lowest within Europe (1.2% in 2010).37
The easiness of getting a credit by
banks is very much dependent on
individual project designs as they assess
reliability of chosen technology as well
as feedstock supply security and price
risks. In general, German feed-in law
64
33 Standard & Poor’s, http://www.standardand-
poors.com/ratings/en/eu/
34 COFACE, http://www.coface.com/CofacePor-
tal/COM_en_EN/pages/home/risks_home/coun-
try_risks/rating_table?geoarea-country=COUN_
AREA_04&crating=&brating
35 Corruption perceptions index 2011, http://cpi.
transparency.org/cpi2011/results/
36 IFC, Doing Business Index, http://www.doing-
business.org/rankings
37 Wirtschaftskammern Österreich, http://wko.at/
statistik/eu/europa-inflationsraten.pdf
enables excellent framework conditions
by providing investment security with
its 20-years payment period for the
tariffs, the prioritized grid access and
the purchase obligation of the grid
operator. Banks in Germany are familiar
with financing biogas plants. If a secured
feedstock supply chain can be presented
for the mid-term, state-of-the-art
technology is applied and a sound heat
use can be proved, banks are willing
to grant credits. However, sharpened
requirements of EEG 2012 (e.g. to use
at least 60% of heat in CHP) heightens
the risk of failing the requirements and
could therewith make it more difficult to
get financing due to higher risks.
Some federal states grant subsidies
for investments in rural areas or the
agricultural sector. In general, public
subsidies can be claimed in addition to
EEG-support at KfW-Bank in terms of
low interest loans for credits with a long
payback period.38 Several private equity
funds are doing business in the German
biogas market too, looking for attractive
investment opportunities.
Useful links:
Rating agencies:
• Standard & Poor’s
• Moody’s
• COFACE
• Corruption Perception Index
• IFC Doing Business
38 KfW, http://www.kfw.de/kfw/de/Inlandsfoerde-
rung/Foerderberater/Erneuerbare_Energien/Biogas/
index.jsp
Project financing institutions:
• KfW-Bank
• German Association of energy agen-
cies
3.2.9. Readiness for Uptake
The readiness for uptake is considered
to be good, though new projects need
to be planned and implemented with
the participation of local inhabitants
and stakeholders. With more than 7,000
biogas plants all over Germany in 2011
the technology is well known to the
public, although only a minor group of
stakeholders is familiar with detailed
functioning, regional impacts and
benefits of biogas plants.
The accelerated development of RES in
Germany is accepted by more than 95% of
the population, thus by a huge majority39,
even in their direct neighbourhood (60-
70%).40 However, when it comes to
biogas, local opposition has intensified
in recent times. Several biogas plans
have reported implementation stops due
to local initiatives and heavy opposition,
even though this is still rather an
exemption than common practice. The
main arguments against biogas are:
Firstly, there are concerns on increased
truck traffic for the feedstock supply on
improper local roads, meaning a higher
risk for inhabitants and a higher stress
for roads which may not be suited for
39 Forsa, http://www.unendlich-viel-energie.de/
uploads/media/FORSA-Akzeptanz_EE_Einauswer-
tung_Bundeslaender_01.pdf
40 Föderal erneuerbar, http://foederal-erneuerbar.
de/startseite
high weights. Secondly, as the biogas
production is the result of biological
decomposition processes in the
fermenter, residents are worried about
odour annoyances. Thirdly, as biogas
production in Germany is based on
energy crops to a wide extent, inhabitants
same as environmental NGOs do not like
to see corn to be cultivated everywhere.
This is based on environmental reasons
(lower bio-diversity, impact on landscape
picture, many areas with high-growing
plants) as well as on concerns on utilizing
food-suitable crops for energy purposes.
It is of utmost importance to carefully
plan new biogas plants and to integrate
local stakeholders and decision makers
into the planning process as early as
possible. Measures for odor emission
reduction should be considered to
Market Handbook Biogas
reduce stress for residents. If possible
and economically feasible, biogas plants
should not rely on energy crops only,
but also use bio-wastes and/or residues.
If only using energy crops, a diversified
mix of energy crops should be applied.
When planning to invest into a biogas
plant, it could be helpful to consult related
associations and support agencies on
how to proceed in the best way. Usually,
there is a lot of know-how and experience 65
available to avoid common mistakes
within the planning process and to get
support in the implementing process. In
Germany, the infrastructure of industry
associations and energy agencies is
excellent, as there are several biogas
associations present with different focus
and regional extension and consulting
energy agencies in every federal state.
 Useful links:
Facts and Figures:
• German Renewable Energies Agency
Information Plaform
• Project ‘Föderal Erneuerbar’
Associations:
• BBE - German Bioenergy Association
• FvB - German Biogas Association
• Biogas Union
• Biogas Council
Institutions:
• Federal Ministry for the Environment,
Nature Conservation and Nuclear Safety
• Federal Agency for Renewable Resour-
ces
Energy Agencies:
Market Handbook Biogas

• Dena - German Energy Agency

• GTAI - Germany Trade & Invest
• German Association of energy agen-
cies

66
3.3. Italy

Associazione Italiana Energie

Agroforestali (AIEL)
Annalisa Paniz
Viale dell’Universita 14
I-35020 Legarno
Tel.: +49-88 30 772
Email: paniz.aiel@cia.it

3.3.1. Country Score

Country Score Central Italy - Biogas (November 2011)

In the general scoring for
sector, Italy - Central is
rated place 12 out of total
81. The underlying cate-
gories that influence this
result are displayed in the
bar chart.

Market Handbook Biogas

Country Score Central Italy - Biomethane (November
2011)
In the general scoring for
sector, Italy - Central is
rated place 12 out of total 67
81. The underlying cate-
gories that influence this
result are displayed in the
bar chart.
 3.3.2. Basic Data
Italy, officially the Italian Republic, is a
unitary parliamentary republic in south-
central Europe. In the north, Italy borders
with France, Switzerland, Austria, and
Slovenia along the Alps. Southern Italy
is made up of the Italian Peninsula,
Sicily, Sardinia –the two largest islands
in the Mediterranean Sea – and many
other smaller islands. Italy is spread over
some 301,338 km2 and is characterized
by a temperate seasonal climate. With
60.6 million inhabitants, Italy is the fifth
most populous country in Europe, and
the 23rd most populous country in the
world. The population density, which
amounts to 201 people per km² (520/
sq. mile), is higher than that of most
Western European countries. However,
the distribution of the population is
Market Handbook Biogas
rather heterogeneous. Whereas areas,
such as the metropolitan areas of Rome
and Naples, or the Po Valley, which alone
accounts for almost half of the national
population, are densely populated, vast
regions, such as the Alps, the Apennine
highlands, the plateaus of Basilicata,
and the island of Sardinia are only very
sparsely populated.
Italy is divided into 20 regions, five of
68 which are having a special autonomous
status that enables them to enact
legislation on various local matters. The
country is furthermore subdivided into
110 provinces and 8,100 municipalities.
Due to the longitudinal extension of
the Italian peninsula, and its largely
mountainous internal conformation,
Italy’s climate is highly diverse. In the
inland of the northern and central regions,
climate classifications range from humid
subtropical to humid continental, as well
as oceanic along the coasts. The climate
of the Po valley region is continental
and therefore characterized by harsh
winters and hot summers. The coastal
areas of Liguria, Tuscany and most parts
of southern Italy have a Mediterranean
climate.
Italy has a relatively small number
of global multinational corporations
in comparison to other economies of
comparable size; however, there is a
large number of small and medium-
sized enterprises, notoriously clustered
in several industrial districts, which
constitute the backbone of the Italian
industry.
In 2009, Italy was the world’s 7th largest
exporter. Italy’s closest trade ties are
within the European Union, where 59%
of its total trade is conducted. Its largest
EU trading partners, in the order of
market share, are Germany (12.9%),
France (11.4%), and Spain (7.4%).
Nowadays, the Italian economy suffers
from numerous problems. After a
strong GDP growth of 5–6% per year
from the 1950s to the early 1970s, and
a progressive slowdown in the 1980s
and 1990s, the last decade’s average
annual growth rates performed rather
poorly at 1.23%, whereas the average
annual growth of the EU was at 2.28%.
The stagnation of economic growth,
and the political efforts to revive it with
massive government spending from the
1980s onwards, eventually produced
a severe rise in public debt. According
to the EU’s statistical office, Eurostat,
Italian public debt rose to 116% of GDP
in 2010, resulting in the second biggest
debt ratio after Greece (with 126.8%).
However, a major difference between
Greece and Italy constitutes the fact
that the biggest share of Italian public
debt is owned by national subjects.
Furthermore, Italian living standards
are marked by a considerable north-
south divide. Whilst the average GDP
per capita in the north exceeds the EU
average by far, many southern regions lie
significantly below this average. Italy has
often been referred to as the sick man
of Europe, characterised by economic
stagnation, political instability and
problems in pursuing reform programs.
More specifically, Italy suffers from
structural weaknesses which are due
to the geographical conformation,
and the lack of raw materials and
energy resources: in 2006, the country
imported more than 86% of its total
energy consumption (99.7% of solid
fuels, 92.5% of oil, 91.2% of natural
gas, and 15% of electricity). The Italian
economy is weakened by its high public
deficit as well as its lack of infrastructural
development, market reforms, and
investment into research. On the Index
of Economic Freedom of 2008, the
country ranked 64th in the world and
29th in Europe - the lowest rating in the
Eurozone.
Italy suffers from an inefficient state
bureaucracy, low property rights
protection, high levels of corruption,
heavy taxation, and public spending that
accounts for about half of the national
GDP. In addition, the most recent data
show that Italy’s spending in R&D in
2006 was equal to 1.14% of GDP which
is significantly lower than the EU average
of 1.84%.
Regarding the national road network,
there were 668,721 km (415,524 mi)
of serviceable roads in Italy in 2002,
including 6,487 km (4,031 mi) of
motorways which are state-owned but
privately operated by Atlantia. In 2005,
about 34,667,000 passenger cars (590
cars per 1,000 people) and 4,015,000
goods vehicles circulated on the national
road network.
In 2003, the national railway network,
which is state-owned and operated
by Ferrovie dello Stato, extended to
Market Handbook Biogas
16,287 km (10,120 mi) of which 69%
are electrified. 4,937 locomotives and
railcars are circulating on this network.
In 2002, the national inland waterways
network comprised 1,477 km (918 mi) of
navigable rivers and channels.
Useful links:
Facts and Figures:
• ISTAT - Italian Statistical Office
69
• EUROSTAT - European Statistical Of-
fice
 3.3.3. Energy Policy
In 2008, Italy’s ratio between gross
renewable production and internal
gross electricity consumption, which
takes the foreign balance into account,
was 16.5%1. Gross production from
RS amounted to 17.5% of total gross
production. Among the different RES,
biogas reached a production level of 1
599.5 GWh in 2008, which constitutes
the equivalent of about 2.75% of gross
production from renewable energies.
About 80% of this production derives
from the recovery of biogas from
municipal waste landfills. The remainder
comes from about 150 biogas plants
located on farms. About 40 of these
agricultural biogas plants are simple low-
cost plants that consist of plastic covers
Market Handbook Biogas
laid over slurry storage tanks.
1 (www.gse.it)
Table ‚RES Production‘: Gross RES electricity production in 2009 and forecasts for 2020
70
Owing to the renewable source incentive
system, the interest in the co-digestion
of slurry with energy crops and agro-
industrial waste has grown throughout
2009 and 2010.
Biogas:
The Italian nREAP is denominated
‘Piano di azione nazionale per le energie
rinnovabili dell’Italia’ (PAN, National
Action Plan for Renewable Energies). For
2020, the target for biogas set by nREAP
is 0,51 Mtoe (see Table ‘RES Production’
and Figure ‘Trend Production’).
The percentages of electricity generated
from biogas in relation to the total
production of electricity from renewable
sources are (related to MW and GWh,
respectively): 1.51% and 2.13% (2005);
1.64% and 3.19% (2010); 1.79% and
3,59% (2011); 1,94% and 3,98% (2012);
2.08% and 4.33% (2013); 2.21% and
 Figure ‚Trend Production‘: Expected trend of gross electricity production deri-
ved from biomass
4,67% (2014); 2.33% and 4.97% (2015);
2.43 and 5.25% (2016); 2.53% and
5.51% (2017); 2.61% and 5.73% (2018);
2.68% and 5.93% (2019); 2.74% and
6.09% (2020).
The PAN establishes several targets for
the use of biogas for heat production.
The target set by nREAP for 2020 is 0.266
Mtoe (see Table ‘RES Heat Consumption’,
Figure ‘Trned Heat Consumption’).
The percentages of heat generated from
biogas compared to the total of heat
generated from RS have been and are
expected to be the following: 1.36%
(2005); 0.68% (2010); 0.79% (2011);
0.89% (2012); 1.04% (2013); 1.20%
(2014); 1.37% (2015); 1.57% (2016);
1.78% (2017); 2.02% (2018); 2.27%
(2019); 2.54% (2020).
Market Handbook Biogas
The only implemented economic
instrument is the feed-in-tariff, which
corresponds to 280 €/MWh over a
period of 15 years. There is still a lack of
a coherent policy framework regulating
the biogas sector. The legislative decree
No. 28/2011 can be considered the only
legislative act that regulates the entire
sector of electricity production from RES
(including Biogas). Nevertheless, basic
decrees for the implementation are not
71
in place yet.
Biomethane:
Targets to use bio-methane (BM) as
a fuel, are included in the targets
which are set for biofuels in general
(such as biogas, vegetable oils, etc.).
These targets include BM, but exclude
biodiesel, bioethanol, hydrogen from RS,
and electricity from RS.
 Table ‚RES Heat Consumption‚: Gross RES heat consumption in 2008 and forecasts for
2020
Market Handbook Biogas

Figure ‚Trend Heat Consumption‘: Expected trend of gross

heat consumption from biomass

72
 Table ‚RES Transport Consumption‘: Gross RES transport consumption in 2008 and
forecasts for 2020
Thus, BM is included into the biofuels
for transport targets, which are the
following: 0 kteo (2005); 5 ktoe (2010);
9 ktoe (2011); 14 ktoe (2012); 18 ktoe
(2013); 23 ktoe (2014); 27 ktoe (2015);
32 ktoe (2016); 36 ktoe (2017); 41 ktoe
(2018); 45 ktoe (2019); 50 ktoe (2020)
(see Table ‘RES Transport Consumption’).
The share of biofuels for transport of the
total of biofuels derived from RS (the
total also includes biodiesel, bioethanol,
hydrogen from RS, electricity from RS)
expressed in percentages have been and
are expected to be the following: 0%
(2005); 0.42% (2010); 0.66% (2011);
0,91% (2012); 1.06% (2013); 1.23%
(2014); 1.32% (2015); 1.45% (2016);
1.51% (2017); 1.61% (2018); 1.65%
(2019); 1.72% (2020).
Market Handbook Biogas
About the measures for BM, the PAN
declares that there is still a lack (and
thus a need) for quality standards for
BM to be injected into the natural gas
grid. Concerning a possible tariff in
order to encourage BM production, the
PAN proposes to either establish a tariff
for the energy injected into the gas grid
as BM, or a tariff linked to the BM energy
utilisation on sites different from those
where BM is produced. The measures 73
are described in more detail but still in
general terms by the Legislative Decree
28/2011 (national transposition of the EC
directive 2009/28/EC on the promotion
of the use of energy from renewable
sources), which delegates the fixation of
tariffs as well as the definition of quality
standards for BM to specific future
Ministerial Decrees.

3.3.4. Feedstock
The main substrates that are used in
Italian biogas plants are animal slurry
and manure (cows and pigs, potential
estimated 130 billion tons/year) as well
as agro industrial residues and energy
crops (mainly maize silage, also sorghum)
Market Handbook Biogas
(see Figure ‘Substrate Biogas’). About
58% of the plants operate in co-digestion
with manure, energy crops, and agro
industrial residues.
Generally, one MW of installed capacity,
when used effectively, requires 250-
300 ha cropland producing maize silage,
which is then to be used in co-digestion
with manure. In the flat areas alongside
the river Po, the harvesting productivity
74 (whole plant) with irrigation supply
facilities can reach 45-50 tons/ha/year
maize. A second harvest in the same
year (e.g. Triticale) can yield about 30-
35 tons/ha/year.
Biogas:
Concerning the availability of feedstock
for biogas production, the potential in the
Po Valley plain, which is characterized by
Figure ‚Substrate Biogas‘: Substrates
used for biogas production
Source: CRPA – May 2011
intensive agriculture, appears to be of
particular importance. Here, the majority
of the Italian livestock producing farms
is located, and the largest number of
biogas plants has been constructed
during the last years (in the ‘70, in the
‘80 and ‘90 and also during the last
‘wave’, characterized by the adoption
of the co-digestion approach and the
German construction technology). In the
Po Valley plain where biogas plants are
mainly fed with animal manure, the biogas
sector could be even more developed
if small biogas plants (CHP from 50 to
150 kWe) were constructed. However,
for this to happen, these plants will have
to become more economic (reduction of
investment costs and a lower share of
electricity self-consumption). In other
geographic locations within Italy (i.e.
Centre and South) the opportunities that
the cultivation of non-conventional crops
(e.g. perennial crops not for food/feed
use) must be investigated more detailed.
One important bottleneck is the local
scarcity of water, which is required for
plant cultivation as well as biogas plant
operations.
Biomethane:
With regards to the feedstock for
biomethane production, the potential
seems to be particular high in the Po
Valley Plain due to the concentration
of intensive agriculture and large-scale
livestock production (i.e. pig farms in
Lombardy, Emilia-Romagna, Veneto and
Piedmont Regions; dairy cattle farms
in Lombardy, Emilia-Romagna and
Veneto Regions; beef farms in Veneto
and Piedmont Regions). Some areas
between the Regions of Veneto and
Emilia Romagna distinguish themselves
by extensive farming, large areas of
crop land per farm, and low levels of
urbanization (in particular Provinces of
Rovigo, Ferrara, Ravenna). Accordingly,
these areas bear a large potential for crop
cultivation devoted to the production
of bioemethane. In other parts of Italy
(i.e. Centre and South) the possibility of
non-conventional crops cultivation (e.g.
perennial crops not for food/feed use)
has to be further investigated.
Useful links:
• CRPA
• CRPA: Il Biometano in Europa e i pos-
sibili incentivi in Italia
• CRPA: Piu’ Biogas integrando i reflui
zootecnici con silomais
• CRPA: Produrre Biogas un’opportunita’
che piace agli agricoltori
• CRPA: Biogas - Metodi di valutazione
del potenziale metanigeno
• CRPA: Biomasse e redditività degli im-
pianti a Biogas
3.3.5. Business Case
The investment costs of biogas plants
can range from 250 to 700 €/Nmc per
anaerobic digester, or between 2500-
7500 € per kWe installed. A typical
investment will be amortized in about
4-8 years.
The subsidies for the operation of biogas
plants are based on a feed-in-tariff
instrument for biogas plants with CHP
units up to 0.999 MWe. The tariff has not
been set by the PAN but it has been fixed
by the national Italian Law no. 99/2009.
The great incentives for electricity
production from biogas (feed-in-tariff =
0.28 €/kWhe lasting for 15 years) has
induced many farmers to invest in CHP
plants with biogas. With regards to the
incentive schemes, the bottleneck is
Market Handbook Biogas
represented by the money to be paid for
stimulating all RES. The overall budget
for electricity production is based on
the electric tariff which is paid by all
Italian electricity consumers (private
households, industries, public structures,
etc.) to the electricity service company
(ENEL). The economic crisis and the
increasing demand for the subsidies in
place for all RES (including photovoltaic,
solar, wind, hydro, biomass, etc.) put the
75
entire system under pressure pushing
policy makers to decrease the level of
subsidies and to find other systems for
developing RES.
The very high level of fossil fuel prices in
Italy are due to:
1) The lack of national fossil fuel
resources
 2) The oligopolistic system that exists
among the relatively few companies
which sell fossil fuels
3) High level of taxes which have
been imposed on fossil fuels due to
very heterogeneous reasons from the
beginning of the last century (among the
first ones: war to Lybia, 1911; among the
most recent ones: public debt, financial
and economic crisis in Italy, 2011/2012).
The very high prices for fossil fuels
increase the economic feasibility of
biomass, which would not be attractive
from an economic point of view if the
taxes were not in place.
The prices for input materials are:
• Silage maize: 50 €/t (costs can be re-
duced to 25 €/t if the biogas plant owner
owns the equipments for cutting, collec-
Market Handbook Biogas
ting, and storing the maize into silos).
• Sweet sorghum silage: 25 €/t
• Triticale silage: 40 €/t
The energy costs can be subdivided
according to the main biogas plant
feedstock and biogas plant size:2
• In-farm and extra-farm energy crops:
200 €/MWh (1 MWel) – 240 €/MWh (0.1
MWel). 3-4 years in terms of the construction
76
• In-farm energy crops: 175 €/MWh (1
MWel) – 250 €/MWh (0.1 MWel). the opportunities for investors remain
• Animal manure: 130 €/MWh (0.6 MWel)
– 200 €/MWh (0.1 MWel).
• Animal manure and silage maize
(30%FM max): 150 €/MWh (0.6 MWel) –
210 €/MWh (0.1 MWel).
2 A. Ragazzoni, 2012
Useful links:
Facts and Figures:
• Energy costs: Contact - Alessandro
Ragazzoni
• Biogas. Normative e biomasse: le con-
dizioni per fare reddito. Alessandro Ra-
gazzoni (2011)
3.3.6. Market Environment
Over the last decade, biogas production
has become a consolidated practice
within the agricultural and animal
breeding sector (pigs and cows), which
until now has mainly produced electricity
to be fed into the public electricity grid.
In terms of numbers of installed plants
and their related capacity, the most
important regions in Italy are Lombardy,
Emilia Romagna, Veneto, Piedmont and
South Tirol, where numerous cattle
sheds are present. At the national level,
there are about 15,000 farms with more
than 100 cows. More than 10,000 are
located in the first four regions listed
above.
The biogas sector has experienced a
strong expansion phase during the last
of new plants which have been built
under the incentive scheme. However,
uncertain due to the ill-defined terms of
the feed-in tariff.
So far, biogas is mainly used for generating
electricity whereas heat production
has been disregarded except for the
heating of the digesters themselves.
In a few cases a small amount of the
heat generated is also used for heating
the farmers’ house and/or the building
dedicated for ‘direct products marketing’
on the farm.
The potential of biogas in Italy has been
estimated at 20 TWh/year corresponding
to the installed capacity of about 2.700
MWe and 6.5 billion Nmc (CRPA.it) biogas
produced respectively. In Italy about
80-85 billion Nmc of fossil methane
(imported from Russia, Libya, Algeria and
near east) is consumed annually (trend
increasing) and the national methane
production is about 8 billion Nmc (trend
decreasing).
In May 2011, 521 biogas plants, of
which 130 are under construction, were
inventoried with a total power installation
of around 350 MWe (Figure ‘Inventory’
and Table ‘Biogas Plants Italy’). These
Figure ‚Inventory‘: Inventoried biogas
plants
Source: CRPA – May 2011
plants are mainly located in northern
Italy. The total energy production is
around 444.3 ktoe.
Despite the fact that there is no
biomethane plant in Italy based on
agricultural substrates, favourable
market conditions, such as the national
fossil methane grid, make biomethane a
promising market even though there is
no plant in operation and no legislative
framework in place for the moment.
BM production is presently hindered by
a lack in Italian legislation concerning
production and use (vehicle fuel or
gas injection into the gas grid) of BM.
Legislation concerning BM development
should encompass:
• BM incentives;
• Repartition of costs among different
Market Handbook Biogas
stakeholders and actors (mainly agricul-
tural biogas producers and gas grid ow-
ners and managers);
• Technical rules that are necessary to
produce and sell BM as a vehicle fuel as
well as the technical rules necessary to
inject BM into the gas grid.
Useful links:
Facts and Figures:
77
• CRPA: State of Biogas in Italy
 Table ‚Biogas Plants Italy‘: Number and type of biogas plants in Italy
N o m i n a l Number and % of biogas plants Increase
power (kWe) April 2007 March 2010 May 2011 2010/2011
Up tp 100 44 28,6% 49 17,9% 54 10,4% 10,2%
101 - 500 28 18,2% 61 22,3% 105 20,2% 72,1%
501 - 1000 19 12,3% 100 36,6% 289 55,5% 189%
> 1000 14 9,1% 19 7% 24 4,6% 26,3%
In boiler 8 5,2% 10 3,7% 11 2,1% 10%
n.a. 41 26,6% 34 12,5% 38 7,3% -
Total 154 100% 273 100% 521 100% 90,8%
Source: CRPA

3.3.7. Regulation • Regional Forest Service of Padua and

Rovigo
The approval process for biogas plants
can be subdivided into two cases: * Province of Padua - Environment
Sector;
• ‘Conferenza dei servizi’ (Unified proce-
dures): all the competent authorities are * Municipality of Vescovana (PD);
Market Handbook Biogas

involved in the same meetings (region or * Environmental Protection Regional

province, municipality, health authority,
fire brigades, etc.)
• ‘Declaration of activity start’ (DIA) to
be presented to the municipality plus all
the single authorizations which are re-
quired.
A practical example of all the Authorities
involved in the Unified procedures,
that can also affect the DIA procedure,
78 consists of the following list:
- Veneto Region:
• Energy Project Unit,
• Geology and Mines Direction,
• “Civil Engineering” Peripheral Unit of
Padua,
• IRA Service of Padua,
Agency – Provincial Department of
Padua;
* Health Local Authority Este - Prevention
Department;
* Regional Distribution Management of
Electricity Society (ENEL);
* Basin Authority of the Adriatic rivers
(VE);
* Land Reclamation Consortium
‘Euganeo’;
* Regional Direction of Cultural Heritage
and Landscape of Veneto Region;
* Superintendence for the Archaeological
Heritage of Veneto Region;
* Superintendence for the Architectural
Heritage and Landscape for the Provinces
of Venice, Belluno, Padua and Treviso;
* Ministry of Communications - Veneto
Territorial Inspectorate - Section III;
* State Property Agency - Veneto
Territorial Agency - Venice Office;
* Ministry of Economic Development
Directorate General for Energy and
Mineral Resources - National Bureau of
Mining, Hydrocarbons and Geothermal
Energy;
Access to the grid is allowed after a
preliminary technical agreement with
TERNA SpA, who owns and manages
the national electrical transmission grid.
After the project approval, the biogas
plant owner must present the project
to the local authority (i.e. region or
province or municipality).
The qualification of plants as plants using
renewable energy sources (‘IAFR’ –
RES-E) is a prerequisite to obtain green
certificates or the all-inclusive feed-in
tariff.
Eligible plants include:
• new, upgraded/repowered, totally/par-
tially renovated and reactivated plants
that have been commissioned after 1
April 1999
• co-firing plants that have been com-
missioned before 1 April 1999 and have
operated as hybrid plants after this date.
Starting in 2009, under the Ministerial
Decree from the 18th of December
2008, plant owners are required to pay
a contribution (based on the average
yearly capacity of their plant) to the costs
incurred by GSE for the qualification
procedure.
The direct quota obligation is managed
by Green Certificates (GCs), which are
tradable instruments that GSE grants
to qualified renewable-energy power
plants (IAFR qualification). They have
been commissioned before 31 December
2012 as per Legislative Decree 28/2011.
The number of certificates issued is
proportional to the electricity generated
by the plant/system and varies depending
on the type of the renewable source used
and of the project (new, reactivated,
upgraded, renovated system/plant).
The GC support scheme is based on the
legislation which requires producers and
importers of non-renewable electricity
to inject a minimum quota of renewable
electricity into the power system every
year.
Market Handbook Biogas
GCs certify the compliance with the
renewable quota obligation: each GC is
conventionally worth 1 MWh of renewable
electricity. GCs are valid for three years:
those issued in respect of electricity
generation in a given year (reference
year) may be used towards compliance
with the obligation also in the following
two years.
To fulfil their obligation, producers
and importers may inject renewable 79
electricity into the grid or purchase an
equivalent number of GCs from green
electricity producers. Producers may
apply for GCs after qualifying their
plants as renewable-energy power
plants/systems (IAFR). Producers whose
plants/systems have a yearly average
nominal capacity that does not exceed
1 MW (0.2 MW for wind power plants/
 systems), excluding solar, can opt for
GCs or the the all-inclusive feed-in tariff.
Upon the first issuing of GCs, GSE opens
an ownership account in the name of
the producer where the issued GCs are
deposited. GSE tracks the movements
of GCs via a dedicated information
system. Holders of ownership accounts
may access the system after obtaining
an appropriate identification code
from GSE. GSE also creates ownership
accounts in the name of producers and/
or importers subject to the obligation
specified in Art. 11 of the Legislative
Decree 79/99 (upon receiving their
self-certification concerning the non-
renewable electricity that they have
generated and/or imported), as well as
in the name of parties wishing to trade
GCs.
Market Handbook Biogas
Holders of ownership accounts can access
their dedicated area of the information
system via the internet in order to check
the status of their accounts and the
movements that have occurred. They
can furthermore use their account to
purchase and/or sell certificates.
Table ‚Emission Thresholds‘: Biogas emissions thresholds
Biogas emission threshold
80 Total Organic Carbon (COT)
CO
NO2
Chlorine Inorganic compounds as gas 10 mg/Nm³
(i.e. HCl)
Hydrogen sulfide
The approval periods for biogas
plants, starting with preparation of the
documents and ending with the final
approval, are relatively long. In the case
of a biogas plant that has up to 1MW
installed electric capacity this process
takes approximately a year.
Biogas plants with a thermal output of
up to 3 MW have to actively undertake
measures to guarantee that their
emissions into the atmosphere do
not exceed given thresholds, which
are summarized in Table ‘Emission
Thresholds’.
Useful links:
Facts and Figures:
• Approval process by authorities
• Qualification of plants
• Green certificates
• Biogas emission threshold
• Regione del Veneto
• Regione del Veneto - ALLEGATOA alla
Dgr n. 2745 del 16 novembre 2010
Norm
150 mg/Nm³ D.Lgs. 152/2006,
800 mg/Nm³ Sezione 3, Parte
500 mg/Nm³ III, Allegato IX alla
parte 5A
0.1 % D.Lgs. 152/2006,
Sezione 6, Parte
II, Allegato X alla
parte 5A
 3.3.8. Project Financing biogas plants are not established at
the national level, but they are fixed
Banks are familiar with financing at the regional level by the means of
bioenergy projects and biogas projects the Regional Development Plan (Piani
in particular. The market perspectives, di Sviluppo Rurale, PSR) according to
the political framework conditions, and the EU Common Agricultural Policy.
the economic parameters are usually Accordingly, the conditions for accessing
well-known to decision-makers. A special these subsidies are particularly severe
focus is put on the reliable, sustainable and only a minority of biogas plants
and long-term availability of feedstock have been able to use these subsidies
supply when decisions about granting for paying part of the investment costs.
credits and loans have to be made.
There is no incentive or rule in order to
The high incentives for electricity increase the whole plant efficiency and
production from biogas (feed-in-tariff = to use the exceeding heat produced by
0.28 €/kWhe), which are the highest in the engine.
Europe, have pushed many farmers to
invest in biogas production. Investments in the Italian market are
considered to be ‘quite safe’ from a
There are several opportunities for country risk perspective. According
financing biogas projects in Italy: to COFACE country risk rating,3 Italy
• private consulting and technology positions itself in the centre span.

Market Handbook Biogas

companies specialized in financing and However, the Corruption Perception
leasing of renewable energy projects Index for the level of transparency is not
encouraging.4
• financing and leasing by banks and
credit institutes. Useful Links:
According to several banks in Italy, Rating agencies:
equity capital of 20-30% of the capital • Standard & Poor’s
costs is required for the sound financing
of biogas projects. The most common • Moody’s
financing method in Italy is credits from • COFACE
private banks that include traditional as 81
• Corruption Perception Index
well as project financing.
• IFC Doing Business
Generally, many banks in Italy are well
prepared to finance biogas projects and
usually have dedicated experts. Most
house banks of farmers are familiar with
this topic and will provide assistance in 3 COFACE: http://www.coface.com/CofacePortal/
biogas projects. COM_en_EN/pages/home/risks_home/country_risks/
country_file/Italy?extraUid=572148
The subsidies for investments in 4 Corruption perceptions index 2011, http://cpi.
transparency.org/cpi2011/results/
 3.3.9. Readiness for Uptake
Until now, there has been no discussion
or rising concern about the conflict
between food and energy production,
and the utilization of agricultural land
for the production of energy crops.
In some cases plants that insisted on
using the same area aroused a conflict
concerning area disposal. In the last
2-3 years, crop prices have been very
low and hence, farmers have regarded
biogas as a possibility to improve the
Market Handbook Biogas
82
valorisation of their land. Overall, the
acceptance of biogas by the public is
quite high. Nevertheless, opposition on
a local level has intensified recently.
The most common problems are related
to concerns about the origin and the
supply of the biomass used to generate
electricity. Sustainability of solid biomass
is also a subject of intense discussions
at the national level.
In Italy, biogas technology is well known
to the public, although only a minor
Figure ‚Opposed Plants‘:
Plants indicated in red are
renewable energy plants
that are opposed by the pu-
blic (2010)
Source: Nimby forum
group of stakeholders is familiar with
its detailed functioning, its regional
impacts, and the benefits that biogas
plants entail.
71% of all plants that are opposed by the
public or residents nearby are renewable
energy plants. Figure ‘Opposed Plants’
indicates the location of these plants
(marked with the colour red) in Italy (all
renewable energy sources for heat and
electricity production are included).

Market Handbook Biogas

83
 3.4. Hungary

Hungarian Bioenergy Competence

Centre (HBCC)
Imre Németh
4 Tessedik Road
HU - 2100 Gödöllo
Tel.: +36 28 420 291
Email: obekk@invitel.hu

3.4.1. Country Score

Country Score Hungary Central Transdanubia- Biogas

(November 2011)
In the general
scoring for sector,
Hungary - Central
Transdanubia is
rated place 39 out
of total 81. The
underlying cate-
Market Handbook Biogas

gories that influ-

ence this result
are displayed in
the bar chart.

Country Score Hungary Central Transdanubia- Biomethane

(November 2011)
In the general
scoring for sector,
84 Hungary - Central
Transdanubia is
rated place 36 out
of total 81. The
underlying cate-
gories that influ-
ence this result
are displayed in
the bar chart.
 3.4.2. Basic data
Hungary is a relatively small country with
a territory of 93,303 km2. It is located in
Europe’s continental zone with moderate
climate. The annual mean temperature
as an average of the past years is 11.2
°C, the mean temperature in January is
-1.7 °C, and in July it is +22.5 °C. The
annual absolute minimum is -16.7 °C,
and the absolute maximum is +35.9
°C. The population amounts to 9,986
thousand.
The output of the Hungarian economy
increased by 1.7% in 2011, which was
more than both, the European Union
average of 1.6% and the Euro zone
average of 1.5%. Agriculture played a
decisive role in the rise of the Hungarian
GDP in the last quarter of 2011, which
was with 1.4% higher than expected.
Hungarian agriculture concluded a
successful period last year: according to
preliminary data, the sector’s output rose
by 29 percent. Gross added value grew
by 48 %, while net business earnings
rose by 75 % compared to 2010 values.
Hungary has a highly developed
road, railway, air and water transport
system. Hungary has a total length of
approximately 1,314 km (816.48 mi)
motorways.
Table ‚Energy Directive‘: 2009/28/EK Renewable Energy Directive
Share of energy from
renewable
gross final consumption
of energy, 2005
Hungary 4.3 %
Useful links:
Fact and Figures:
• Hungarian Central Statistical Office
• Ministry of Rural Development
• Hungarian Tourism PLC.
3.4.3. Energy Policy
Hungary is subject to a binding target
of supplying 13% of its total energy
demand from RES by 2020. According
to the Renewable Energy Strategy for
2007-2020, to reach this target, the use
of renewable energy sources must be
increased from 55 PJ in 2006 to 186.4 PJ
by 2020. However, in Hungary’s National
Energy Efficiency Action Plan, approved
in December 2010, the government set
an even more ambitious target of 14.65%
Market Handbook Biogas
(see Table ‘Energy Directive’). The 2010
target of 3.6% was actually achieved
in 2007, mainly due to the increase
of biomass utilisation. By 2020, the
potential biogas production is expected
to reach 32 MW, which would reflect 5%
of the total renewable energy generated
in Hungary. The trends and volume of
changes in renewable energy sources
are illustrated in the Figure ‘Renewable
Energy’. 85
Target for share of energy
sources in from renewable sources
in gross final consumption
of energy, 2020
14.65 %
 Table ‚Renewable Energy‘: Forecast of renewable energy amounts
Source: NREAP
Market Handbook Biogas
Currently there is no central policy
or separate plan proposing measures
specifically for biogas. The NREAP states
that a separate biogas action plan is to
be drawn up in the near future, reviewing
the energy sector and adopting incentive
measures to cover all segments of
the sector in the framework of an
integrated ‘Biogas Action Plan’. The use
of currently available bioenergy shall be
encouraged by setting blending targets,
86 guaranteeing feed-in prices and other
support programs. The most important
support mechanism aiming at bio gas
promotion is the guaranteed purchase
price for electricity from renewable
energy sources (feed-in tariff).
The 1999/31/EC directive on landfills
prescribes, amongst other things, the
issue that by the middle of 2016 the
biodegradable organic matter fraction
that is landfilled with municipal solid waste
should be decreased to 35% compared
to the base year 1995. The 2000 Act
XLIII on Waste Management contains the
recommendations of the EU directive,
and thus in Hungary the biodegradable
fraction of landfilled municipal solid waste
will have to be decreased. The organic
fraction of municipal solid waste is worth
disposing of, or utilizing in biogas plants,
as it is possible to reduce the amount
of landfilled waste and also to limit the
CO2-emission, while the material left
behind after digestion can be returned
to the land.
As a result of the above changes,
renewable energy source structure will
become more diversified. Biomass use
will increase in volume, but its share will
Figure ‚Distribution‘: Distribution of renewable energy sources used in the
electricity, heating andcooling and transport sectors (2010)

Source: NREAP

Market Handbook Biogas

Figure ‚Distribution Forecast‘: Distribution of renewable energy sources
used in the electricity, heating and cooling and transport sectors (2020)

87

Source: NREAP
 decrease, as can be seen in the Figures
‘Distrubution’ and ‘Distribution Forecast’.
Useful links:
Laws and Ordinates:
• Hungarain Enery Office
• Control Energy Program
• National Renewable Energy Action Plan
3.4.4. Feedstocks
Hungary possesses excellent agro-
ecological conditions for a competitive
production of biomass. Hungary’s total
biomass resources sum up to 350 to 360
million tonnes. Of these, 105 to 110 million
tons of primary biomass (deriving from
vegetation) are regenerated annually;
however, only 3% of this is utilised by the
energy sector. 59.5 % of the country’s
Market Handbook Biogas
territory is used for agricultural purposes
and 20.5 % is covered by forests. The
total cultivation area (agricultural +
forest + reed + fish pond) adds up to
81.2 % of the country’s territory. The
agricultural territory per person is 5,545
m2, and related to cultivated land it is
4,508 m2/person.
It is important to stress that the ratios
stated above represent the planned
88 national average. Ratios in certain
regions or micro regions could, depending
on local conditions, differ significantly
due to the exploitation of comparative
advantages (e.g. in the Southern Great
Plain the share of geothermal energy
will probably be higher, while in Western
Transdanubia solid biomass will be
predominant).
Hungarian agriculture is capable of
producing biomass in a sustainable
way without competing with food and
feed production, and at the same time,
there is a significant biogas production
potential. The theoretical potential
of energy sources of biological origin
(bioenergy) could provide 20% of the
energy demands estimated for 2020, and
bioenergy-based electricity production
can be planned well in advance, which
means it is controllable and can be used
to balance the fluctuating energy supply
from other RES. Therefore, the limitations
of the production of bioenergy mainly are
a factor of competitiveness. Bioenergy
can primarily play a more important role
in fulfilling local heating demands in the
future, but strong emphasis also must
be put on the spreading of small and
medium-capacity combined electricity
and heat generating systems.
According to the EU-project Redubar,
Hungary has a potential to generate
almost 9 billion m3 of biogas from
agricultural residues, animal by-
products, sewage sludge industrial and
municipal organic waste (see Table
‘Biogas Potential’ and ‘Potential Waste’).
Based on an optimized legal, economic
and supporting environment, if 35 per
cent of animal manure and 5 % of
agricultural land were involved in biogas
production, energy production from
biogas could increase to 750 MW of
built-in performance over the next 10 to
20 years. According to experts from the
Hungarian Biogas Association however,
the energy supply objective is to directly
use at least half of the produced biogas
 Table ‚Biogas Potential‘: Biogas potential from different sources

Source of biomass On the average

1. Agricultural 131,32 PJ
residues
2. Forestry residues 39,22 PJ
3. Animal by- 3,72 PJ
products
4. Sewage sludge 5,91 PJ
5. Industrial organic 0,42 PJ
waste
6. Municipal waste 42,25 PJ
Total: 222,84 PJ
In biogas: 8 914 million m3
In natural gas 5 714 million m3
equivalence:
Source: Redubar project

Market Handbook Biogas

Table ‚Potential Waste‘: Hungary’s biogas potential from waste
Name Amount Biogas production Natural gas
million t/year billion m3/year equivalent
[billion m3/year]
Animal By- 43 1,6 1,1
products
Municipal waste 10 0,7 0,5
Energy Crops 30 3,3 2,2
Σ 83 5,6 3,8
Source: Redubar project

for direct incineration, bio-methane
or fuel. This way the biogas sector will
be able to produce 10.5 PJ of electrical
energy and 25.5 PJ of heat energy. This
latter utilization scheme would have
considerable advantages from an energy
use efficiency perspective as well.
The use of organic matter from animal
husbandry for energy purposes can
enable productive waste management,
and at the same time increase the 89
competitiveness of the sector. The use
of by-products and other solid wastes
from agriculture and forestry (e.g. by-
products from ploughing, cuttings from
orchards and vineyards) for local energy
purposes, and their conversion into
end products, will result in additional
income for farmers and producers, and
can significantly reduce the need of
 communities for fossil energy sources.
The most commonly used raw materials
for biogas production are :
• Manure
• Whey
• Abattoirs wastes
• Industrial organic wastes
• Agricultural wastes
• Source separated kitchen waste
• Commercial organic wastes
• Sewage sludge
Useful Links:
Fact and figures:
• Energiaklub
• Hungarian Central Statistical Office
Market Handbook Biogas
• MBE,Hungarian Biogas Association
• MAVIR Hungarian Independent Trans-
mission Operator Company Ltd.
3.4.5. Business case
For Hungary, where natural gas
has the biggest share in the energy
consumption mix (44%) and is imported
up to 80%, substitution of natural gas
90 by domestically produced biogas has
become a particularly pressing issue.
The Hungarian National Renewable
Energy Strategy (nREAP) therefore
places special emphasis on promoting
biogas production and use. However,
biogas production’s profitability is
still negative and currently available
technologies still do not allow biogas to
compete economically with natural gas.
This fact called policy makers into action,
which resulted in encouraging the use of
currently available bioenergy by setting
blending targets, guaranteeing feed-
in prices and other support programs.
The most important support mechanism
aiming at bio gas promotion is the
guaranteed purchase price for electricity
from renewable energy sources (feed-in
tariff).
As a result of the support system which
has encouraged investment over the
past few years (KEOP – Environment
and infrastructure Operative
Programme, UMVP – New Hungary Rural
Development Program), construction of
Hungarian agricultural biogas plants has
now commenced. All the biogas plants
in Hungary, with one exception, create
electrical energy from the produced
biogas and this energy is sold via the
feed in tariff system (KÁT). The slow
increase in the number of biogas plants
has to do with the nature of the support
system for biogas production. The
current feed in tariff system does not
differentiate explicitly between the types
of renewable energies even though there
are significant differences in the height
of their production costs.
The feed-in tariff scheme remains a
system with guaranteed feed-in tariffs
as opposed to a green certificate system.
The standard term for the guaranteed
takeover of energy for fixed feed-in
tariffs will be 15 years within the new
system. For an overview of the tariffs for
the different plant sizes please consider
Table ‘Feed-In-Tariff’ and Figure ‘Changes
Feed-In-Tariff’.
 Table ‚Feed-In-Tariff‘: Feed-in tariffs in Hungary (2012)
Rate*( HUF/kWh) Plants smaller than Plants of 20 - 50 Plants larger than
20 MWel MWel 50 MWel
Peak rate 34.31 27.45 21.34
Valley rate 30.71 24.57 13.66
Deep valley rate 12.53 10.02 13.66

Figure ‚Changes Feed-In-

Tariff‘: Changes in feed in
tariff prices between 2003
– 2009

Market Handbook Biogas

Source: Hungarian Biogas
Association

According to expert estimates, average operate economically only in exceptional

investment costs of a biogas plant for
1 kW performance may amount to HUF
1.2 or 1.3 million. The project costs
may be even higher if the biogas plant
should furthermore perform special
functions (e.g. waste management). As
a general rule, the specific costs slightly
decline as the capacity of the plant
increases. In Hungary – at the actual
cost/ return ratio and due to the KÁT
– smaller biogas plants (<500 kW) can
cases, while the implementation of such
plants may be still justified, principally 91
for the sake of waste management.
The aim of the compulsory feed-in
tariff system created in 2003 was to
support environment friendly, efficient
energy sources and technologies, and
to facilitate their spreading. It made
it compulsory to purchase electricity
produced from renewable energy
sources and in small cogeneration power
 plants at a price higher than the current
market tariff. The system is divided into
two parts (KÁP, 2003-2007; KÁT, 2008-
2011). The primary difference between
the two periods lies in their respective
calculation techniques, that is, the
balance of electricity calculated this way
and of money spent for such purposes.
Energy produced in cogeneration was
the majority (approx. 70%) in both. Over
time, producers who were originally not
meant to be eligible for subsidies also
‘lobbied themselves’ into the system.
This was the case with larger power
plants (e.g. the Budapest Power Plant),
and fossil power plants (Vértesi, Mátrai)
using part biomass, a RES.
Hungarian biogas is mainly based on
agricultural waste, by-products and
residues, and not on energy crops.
Market Handbook Biogas
Since no premiums are paid for the use
of renewable crops, Hungarian biogas
production is reliant on low cost and
Table ‚Raw Material Cost‘: The raw material costs of 1 m3 biogas in the case of different
raw materials*
R a w Price (t) Deliver y
material cost (t)
92 Maize waste 1500 HUF 1000 HUF
from tinning
factory
Liquid pig 0 1000 HUF
manure
S i l a g e 6000 HUF 2000 HUF
maize
*Approximate figures
abundant feedstock like liquid manure,
waste from slaughterhouses and
sewage. Soaring prices for agricultural
crops also hinder a shift towards the use
of agricultural crops as biogas feedstock.
In 2010 for electrical energy production
independent of weather conditions the
average feed in tariff was 27.5 HUF (also
in the case of production for grid during
off peak periods): that is the return from
sales for 1 m3 biogas (depending on the
efficiency of the plant) was 40-55 HUF
for agricultural biogas plants.
If the m3 sales price is compared to the
cost of raw materials, it becomes clear
that for the case of certain raw materials
it is barely possible to generate an
income that is higher than the costs of
the raw materials, which means that
the use of these raw materials is not
profitable (see Tables ‘Raw Material Cost’
and ‘Feedstock Costs’).
V o l u m e Price biogas
of biogas per m3
produced
(m3/t)
2500 HUF 125 40 HUF
0 26 38 HUF
0 190 42 HUF
Table ‚Feedstock Costs‘: Characteristics of the feedstocks in 2011 (without transport costs)
Name P r i c e / N e t Biogas Yield
costs Nm3/t
HUF/t
Silage 6300 200
Manure 1000 70
Liquid Manure 0 26
Animal By- 0 400
product
Source: J. Popp, N. Potori 2011
3.4.6. Market Environment
Renewable energy sources represented
4.9% (54.8PJ) of Hungary’s primary
energy consumption in 2007, and
according to estimates, in 2008 this
share increased to 5.3%. In 2007, 65%
of the renewable energy sources were
used for heat generation, 33% for
electric power production and the rest
for the production of biofuels.
Natural gas is the most important source
in Hungary’s primary energy mix, and
ranks before oil and nuclear power. The
country has inland gas resources which
cover about 20 % of the gas demand,
however, these resources are in decline.
Hungary is still highly dependent on
imports from Russia (about 80 %).
The gas is fed into the Hungarian high-
pressure pipeline system which is owned
and operated by TSO FGSZ Ltd. The
system is widely spread out to about
5,700 km in length. More than 90 % of
the settlements have access to natural
gas.
Hungary is among those EU countries
that have a considerable biogas
Specific Costs S p e c i f i c
HUF/Nm3 Feedstock
Demand
[t/m3]
42 0,7
14 1,3
38 1,05
0 0,6
potential. Biogas production and the
utilization of this potential is still a task
for the future. Before 2003 Hungary did
not have any agricultural biogas plant.
Biogas production and its utilization for
the production of electrical energy had
mainly to do with sewage treatment
plants until recently. During the last
Market Handbook Biogas
years however a strong increase in
biogas production could be recorded
(see Figure ‘Production and Sales’).
Biogas is currently being produced
at approximately thirty-five sites in
Hungary, one part of which is based on
agricultural by-products (animal manure,
plant products and by-products: silage
maize, sweet sorghum, etc.), while the
other segment is represented by biogas
plants connected to communal waste 93
water treatment facilities. About thirty
additional plants are currently under
planning or construction (see Tables
‘Plants in Operation’ and ‘Agricultural
Biogas’).
In 2010, in Zalaegerszeg - a city in the
west of Hungary - the country’s first
biomethane project was implemented
 Figure ‚Production and Sales‘: Production and sales of biogas plants between
2008-2010 (GWh)

Source: Hungarian Energy Office

Market Handbook Biogas

at the municipal waste water treatment by membrane technology in the future.

plant. Raw sewage gas is upgraded by The biomethane produced is intended to
water scrubber technology to natural feed into the low pressure grid.
gas quality and utilised as vehicular More biomethane production plants are
fuel. Another biomethane plant is under expected to also appear in Hungary in
development in Kaposvar. Biogas is to the near future, and will enable the use
be sourced from organic residues of of purified biogas equivalent to natural
the local sugar factory and upgraded gas for transport purposes by feeding
it into the gas pipe network. Biogas
94
Figure ‚Plants in Operation‘: Biogas Plants production is expected to double by
in Operation in Hungary (2011) 2020. With regard to biogas, increasing
Plants MW attention must be paid to dual-purpose
Biogas 36,95 use and the increase of added value in
Municipal waste 6,49 the following years.
Pyrolisis 1,66 Besides green electricity generated
Sewage 10,19 through biogas production, green heat
Total 55,28 generated for direct use will also have
priority. This could directly result in
Source: Ministry of National Development
an improvement of cost-effectiveness,
 Figure ‚Agricultural Biogas‘: Opera- related industries could be involved, and
ting bioenergy productioning agri- in addition to the use of by-products and
cultural biogas plants in Hungary the disposal of waste, new jobs could be
Biogas Plant created.
1 Nyírbátor 2600 In the field of transportation, the role
2 Kenderes 1052 of biogas is expected to increase in the
3 Pálhalma 1737 future, primarily in those rural towns
4 Kaposvár Direct where biogas can be obtained (refuelled)
biogas from within a reasonable distance. The
use simplification of the authorisation of
5 Klárafalva 526 CNG filling stations in a system similar to
6 Kecskemét 330 LPG could be a very important aspect of
7 Csengersima 537 the development of the domestic biogas
8 Dömsöd 1600 industry.
9 Kapuvár 526 Useful links:
10 Kaposszekcső 836
• Hungarian Central Statistical Office
11 Bonyhád 625
12 Nyírtelek 625
• Ministry of National Development
13 Dombrád 625
3.4.7. Regulations

Market Handbook Biogas

14 Biharnagybajom 625
15 Bugyi 499 In Hungary, there is no uniform
16 Bicsérd 637 procedure for licensing the construction
17 Vámosoroszi 625 of the biogas plants, due to the fact
18 Pusztahencse 1200 that obtaining permits is a complicated
19 Jászapáti 637 process with several threads running
20 637 concurrently. The timescale for projecting
21 Hajdúszovát 625
and licensing biogas plants is twice or
even three times as long as that of the
22 Ostffyasszonyfa 625
construction itself.
23 Kemenesmagasi 625
The Governmental Decree No 19/2009 95
24 Gyulavár 500
25 Ikrény 625 on the provisions of the Hungarian
Gas Law (Act XL 2008) assures the
26 Szeged 120
non-discriminatory access to the gas
27 Szarvas 4700
grid. Biomethane can be fed into the
28 Nagyszentjános 526 grid as long as its quality meets the
requirements of the national standard
MSZ 1648:2000. This standard focuses
on natural gas and does not regulate
Source: Hungarian Biogas Association the usage of different biogas feedstock
 or any method for adjusting the heating
value. However the standard requires e.
g. a strict limit for the oxygen content
of 0.2 % by volume and a continuous
online measurement of the gas quality.
Useful links:
• Ministry of National Development
• Hungarian Energy Office
• Energy Centre Non-profit Ltd.
3.4.8. Project Financing
The vast majority of the Hungarian
biogas projects have been granted
aid through a measure under the New
Hungary Rural Development Plan by
the Minister for Agriculture and Rural
Development entitled ‘Modernisation
of animal holdings under Decree No
Market Handbook Biogas
27/2007 (IV. 17.) on aid granted for the
modernisation of animal holdings from
the European Agricultural Fund for Rural
Development.
Useful Links:
Institutions with budgets for project/
R&D support:
• NIH, National Innovation Office
• MAG Zrt Hungarian Economic Deve-
96 lopment Center
• MFB - Hungarian Development Bank
• Energiaközpont
3.4.9. Readiness for Uptake
Biogas is currently being produced
at approximately thirty-five sites in
Hungary. In Hungary the support of
biogas plants in the society is positive,
because these usually solve critical
environmental problems. Until now,
consumer resistance has not been
observed, because the plants have
been implemented in sufficient distance
from villages. The required distance by
the Environmental Authority is at least
500 m. The affected population should
always be involved in the licensing
process of the biogas plants. Consumer
forums should present the investment
and operation of the plant. In case of
conflicting interest legal redress can
be appealed. Part of the authorization
process is to ensure the approval of the
social ‘Green organizations’ as well.
In Hungary the strongest organisation
in the sector is the Hungarian Biogas
Association which is promoting the
benefits of biogas plants via a variety
of media - conferences, brochures, etc.
– and is campaigning the construction
of plants. Governmental and political
decision-makers are consulting with
the HBA as well. In coordination
with the biogas plant constructions
various clusters and market players
give technical assistance. Among the
higher education institutions mostly the
agricultural sciences are taking part in
the spreading of technologies and in the
creation of laboratory background and
by providing services.
Useful links:
Associations:
• MBE - Hungarian Biogas Association
• BITESZ - Union of Biobass Product Line
• MGKKE - Hungarian Gas Transport
Cluster Association
• MMESZ - Hungarian Association of Re-
newable Energy Sources

Institutions:
• Ministry of National Development, Mi-
nister of State for Climate Change and
Energy
• Ministry of Rural Development
• Hungarian Institute of Agricultural En-
gineering

Market Handbook Biogas

97
 3.5. Denmark

Danish Bioenergy Association

(DI Bioenergi)
Kristine van het Erve Grunnet
H.C. Andersens Boulevard
DK-1787 Copenhagen V
Tel.: +45 3377 3369
Email: keg@di.de

3.5.1. Country Score

Country Score Central Denmark - Biogas (November 2011)
In the general
scoring for sec-
tor, Denmark
- Central is ra-
ted place 35 out
of total 81. The
underlying cate-
gories that influ-
Market Handbook Biogas

ence this result

are displayed in
the bar chart.

Country Score Central Denmark - Biomethane (November 2011)

In the general
scoring for sec-
tor, Denmark -
98 Central is rated
place 31 out of
total 81. The
underlying ca-
tegories that
influence this
result are dis-
played in the
bar chart.
 3.5.2. Basic Data1
The Kingdom of Denmark (excluding
Greenland and the Faroe Islands) has a
mainland area of 43,098 km² and shares
a small land border with Germany to
the south. Its closest Nordic neighbour
is Sweden to which it is connected by
bridge. The bulk of Denmark is the
peninsula Jutland and the rest of the
country consists of 406 islands, of
which 78 are habited, and the largest
two islands are Zealand and Funen.
Denmark also exercises sovereignty
over the Faroe Islands in the North
Atlantic and Greenland, which is part of
the North American continent, both of
which enjoy autonomous self-.rule. The
topography of Denmark is relatively flat
with few hills, its highest point being no
more than 173 metres above sea level.
Of the total surface area, 62%. is used
for agriculture, which offers a great
theoretical potential for agricultural
feedstock supply for the biogas sector
The population of Denmark was 5.5
million in 2010, with 126 inhabitants per
km², almost half of whom live on the
islands of Zealand and Funen. Almost
87% of the population lives in urban
settlements.
Denmark has one transmission system
for gas, owned and operated by
Energinet.dk, on behalf of the Danish
State. Transmission tariffs are based on
an entry-exit model and the same tariffs
apply to all entry and exit points. The
natural gas transmission system consists
1 Energy Policies of IEA countries, Denmark 2011
review
of upstream pipelines in the Danish part of
the North Sea and onshore transmission
pipelines. The transmission pipelines
go north-south (Aalborg-Ellund) and
west-east (Nybro-Dragør). The natural
gas transmission system also includes
a gas treatment plant (Nybro) and
two underground gas storage facilities
(Stenlille and Lille Torup). The Danish
gas transmission grid is connected to the
German gas transmission grid at Ellund
on the Danish/German border and to the
Swedish gas system at Dragør. Sweden
is solely supplied with gas via the Danish
gas system.
The electricity transmission system in
Denmark is separated both operationally
and geographically into two parts, the
west (Jutland and Funen) and the east
(Zealand). In 2005, Energinet.dk was
Market Handbook Biogas
established, as a single state-owned
transmission system operator, by
merging two system operators: Elkraft
in western Denmark and Eltra in eastern
Denmark. The geographical separation
ended in 2010 when the Great Belt
Power Link connecting western and
eastern areas with 400 kV direct current
(DC) cables was commissioned. Despite
separation within Denmark, the eastern
area was already connected with Sweden 99
and the western area was connected with
Norway and Sweden. Therefore, both
areas had been able to trade electricity
through the Nordic market even without
the Great Belt Power Link. The 6,300
km-long Danish transmission system
consists of 400 kV and 150/132 kV lines.
Energinet.dk is the owner of the 400
kV facilities, as well as part of the 132
 kV facilities, the Great Belt Power Link
and interconnection lines with Norway,
Sweden and Germany. Most of the
150/132 kV transmission facilities are
owned by nine regional grid companies.
3.5.3. Energy Policy
The Danish government aims at reaching
a share of renewable energy sources
(RES) in the final energy consumption
of approx. 30%, and 50% of the energy
consumption in the electricity sector
is to come from wind by 2020. The
RES-share in Denmark’s final energy
consumption shall be rising to 100%
in 2050. Due to its characteristics as
a storable feedstock and a flexible
energy supply, bioenergy will play a
key role in this strategy. For biogas the
Market Handbook Biogas
aim is to use 50% of the manure from
livestock to produce biogas. To facilitate
this development a task force is to be
established by the Danish government.
This task force is to support the specific
projects and make recommendations for
additional initiatives, if in 2012-13 it will
be assessed by the Danish government
that the expansion process is too slow.
The political will to develop the biogas
sector can be seen as favourable, as
100 the benefits of biogas are recognized
and biogas is seen as a key technology
to increase the market share of RES in
general. Biogas can provide both base
load and peak load electricity, which
makes it a valuable option to balance
fluctuating RES energies like wind power
and photovoltaic.
The energy agreement of 2008 stated
that biogas will primarily replace natural
gas and is considered to be both an
important contribution to the security of
supply and is furthermore considered by
society to be an economically attractive
solution. At first biogas will replace
natural gas in the decentralized CHPs
and if the cost of converting biogas to
natural gas standard can be done at
a compatible price, biogas will in time
be distributed in the gas grid as well.
The biogas is today mainly used in
decentralized CHPs, where it replaces a
part of the natural gas consumption.
The support scheme is described in
the renewable energy law in Denmark,
called ‘Promotion of Renewable Energy
Act’ (Bekendtgørelse af lov om fremme
af vedvarende energi)
Useful links:
Governmental institutions:
• Danish Energy Agency
• Danish ministery of Climate, Energy
and buildings
Associations
• Danish Bioenergy Association
• Danish Biogas Association (only Da-
nish)
• Danish Agriculture and Food Council
 3.5.4. Feedstock2
Feedstock potential for biogas in
Denmark is high in terms of manure
from livestock and energy crops. Today
the dominating energy carrier for
biogas however is manure, waste from
industry and sludge. The biogas process
has already been used over the past
100 years to stabilize sludge from the
wastewater treatment plants.
Danish agriculture produces approxi-
mately 35 million tons of manure from
livestock and 1.6 million tons of this
is used for biogas. This corresponds
to approximately 4-5% of all manure
in Denmark and when converted into
biogas gives approximately 1 PJ3 of
2 PÖYRY Management Consulting, evaluation of op-
tions to enhance the nordic vooperation in the field
energy output. The untapped potential
of manure from livestock is 22 PJ and is
the second most untapped potential (see
Table ‘Energy Potential’). The largest
potential of 42 PJ comes from energy
crops.4 The amount of land that will be
used to grow energy crops depends on a
political decision which should encounter
both, the aspect of food supply and the
protection of the environment. Even
though today only a few plants process
energy crops such as corn and grass
silage, a future shortage of usable waste,
which could occur when the potential is
fully exhausted, will probably result in
an increasing use of livestock manure
and energy crops for biogas production.
The Danish agricultural sector’s contri-
bution to bioenergy production is already
relatively high as 12% of Danish energy

Market Handbook Biogas

of solid biomass for energy purposes
3 Biogasanlæg bidrager til et bæredygtigt landbrug, 4 Biogaspotentiale i danske kommuner, Energinet.
Videncentret for Landbrug dk

Table ‚Energy Potential‘: The energy potential for biogas (in PJ)

Agriculture sector Exploited Unexploited

Livestock manure 1 22
Energy crops - 42
Meadow grass - 3
Cover crops - 14
Total 1 81 101
Other sources Exploited Unexploited
Wastewater sludge 0.9 1-3
Industrial waste 1 <1
Meat and bone meal 0.03 0.5
Garden and park waste 0 1
Landfill gas 0.3 -
Total 2.2 2-5
 consumption is covered by the use of
residual products such as straw, wood
chips and slurry. This is, in particular,
a result of the use of these residual
products in the CHP sector.5
In Denmark, however, the potential for
producing bioenergy from biomass is
greater, without any particularly negative
impact on the production of animal
feed and food. Estimates show that it
is possible to raise Danish agricultural
production of biomass for bioenergy
four to five times through greater
exploitation of straw for CHP plants,
slurry for biogas, animal fat for biodiesel
and by using perennial energy crops as
well as grass from low-lying areas. It
will, however, be necessary to include
part of the former set-aside land in the
production of perennial energy crops. It
Market Handbook Biogas
the western part of Denmark due to a
high agricultural rotation. Moreover the
largest potential for biogas from plant
breeding is to be found in Lolland, which
is an island situated in south east of
Denmark. The potential from harvesting
of meadow grass for biogas is also
situated in areas with a high rotation in
the agriculture such as Jutland, although
a small potential can be found in the
metropolitan area as well.7
Useful links:
Facts and figures
• Danish Energy Agency
• Statistics Denmark
• Energinet.dk
Associations:
• Danish Bioenergy Association

is a matter of technical potential, which

may not necessarily be realised within • Danish Biogas Association (only Da-
the economic framework that applies nish)
today. The previous Danish settlement • Danish Agriculture and Food Council
price for electricity from biogas plants
7 Biogaspotentiale i danske kommuner, Energinet.
constitutes a barrier, but has now been dk
improved. Furthermore, it is uncertain
whether farmers will consider the profit
from utilizing low-lying areas large
enough to harvest this biomass.6
102 The biogas potential from livestock
manure is highest in regions in the
southern, western and northern part of
Denmark as seen in the Figure ‘Livestock’.
The potential for energy crops and cover
crops are mainly in Jutland in

5 Energy Policies of IEA countries, Denmark 2011

review
6 Ministry of food, Agriculture and Fisheries, Report
on Biomass
 Figure ‚Livestock‘: Livestock combination by region (Farms, All Livestock Farms (incl.
other livestock than cattle and pigs), 2011

Market Handbook Biogas

Source: Statistics Denmark

3.5.5. Business Case and in the Danish energy agreement

In Denmark the RES-E production is
supported by feed in tariff premiums
that are paid on top of the market price
but are mostly capped at a maximum
amount of market price plus premium.
The instruments are prepared and
managed by the Danish Energy Agency.8
The development in the biogas sector
has so far been unsatisfying and the lack
of progress in the sector can be traced
back to insufficient economic incentives
for the biogas producers and difficulties
concerning the location of planned
biogas plants. The government has
introduced a task force to help finding
suitable locations for biogas plants,
8 www.ens.dk
of March 2012 the support scheme for
the use of biogas has been enhanced
by giving a higher price supplement,
equalizing the price supplement for
biogas used in the gas grid and CHP
and introducing a price supplement to
biogas used in transport and processes.
Furthermore the start-up aid for new 103
biogas projects has been increased from
20% to 30% of the investment costs.
The remaining funds will be provided by
a 60% municipal-guaranteed loan and
10% own financing. In addition biogas
used in heat production in a CHP plant is
exempted from energy tax.
In the new Danish energy agreement
of March 2012 a more ambitious plan
 for biogas expansion was implemented.
The agreement includes the following
elements:
• the current funding of biogas for CHP
is to be increased to the total of 15.54 €/
GJ (115 DKK./GJ) in 2012. The support is
divided into the following subcategories
• The existing support of 10.68 €/GJ (79
DKK. / GJ) for biogas used in cogenera-
tion plants will further prevail as a basic
subsidy.
• Biogas used in the natural gas grid
is equalized with biogas used in CHP,
so that biogas supplied to the gas grid
achieves a basic subsidy of 10.68 €/GJ
(79 DKK. / GJ) as well.
• A new basic subsidy for biogas used
in company processes and transport is
introduced and is giving a net of 5.27 €/
Market Handbook Biogas
GJ (39 DKK. / GJ)
• A subsidy of 3.51 €/GJ (26 DKK. / GJ)
for all uses of biogas is introduced. The
subsidy will be phased out by the incre-
asing natural gas prices.
• capital installation subsidies are to be
increased from 20% to 30%,
• a task force is to be established. This
task force is to support the specific pro-
104 jects and make recommendations for
additional initiatives, if, the assessment
in 2012-13 reveals that the expansion
process is too slow.
The support scheme for renewable
electricity consumption is financed via
the PSO (Public Service Obligation)
scheme and thus by the consumer’s
energy bills. With the new energy
agreement a security of supply fee on
space heating is to be introduced to
cover government funding for biogas,
industrial CHP, energy savings packages
in privately owned rental properties,
renewable energy in businesses, as well
as the government’s loss of taxes due to
lower consumption of fossil fuels.
The energy tax system is differentiated
between space heating (in businesses
and households) and energy used in
production processes. The energy taxes
are balanced according to the energy
content of the different fuels.
In January 2008, the CO2 tax levied on
VAT-registered enterprises was 20.27 €/
per ton (150 DKK/ ton), an increase of
8.11 €/ ton (60 DKK/ ton). In addition to
the carbon tax, a wide variety of other
taxes are applied to energy consumption
and use with the exception of fuels for
electricity generation.9
The amount and transferability of the
dry weight in the reactor tank is of
utmost importance for the achievement
of the biogas production. The dry weight
content of manure is notoriously too
small to produce enough biogas slurry
to make the production profitable, at
least with the existing plant sizes. As a
rule of thumb larger plant sizes obtain a
more profitable operation of a dry weight
biomass, since treatment costs per ton
is diminishing by the increasing size of
the installations.10
The supply of organic waste from a
variety of sources is introduced in order
9 Energy Policies of IEA countries, Denmark 2011
review
10 Kogebog for etablering af biogasanlæg, INBIOM
to increase the gas production in the
majority of current plants. There is a
limited amount of suitable waste, which
results in a high payment rate for the
best waste. Some facilities have begun
using corn silage, but the economic
gains are debatable.
3.5.6. Market Environment
Total primary energy supply (TPES)
in 2010 was 19.7 million tonnes of oil
equivalent (Mtoe). Energy production
amounted to 23.2 Mtoe, which was below
2009 levels and indicative of falling oil
and natural gas production over the past
six years.
Denmark is a net exporter of oil and
natural gas and can be expected to
remain so at least until end-2018 for oil
and 2020 for gas. Energy exports were
17.2 Mtoe in 2010 while imports were 13.8
Mtoe, making Denmark a net exporter
of energy. The share of RES in TPES is
with 20.7% relatively high, largely wind
and biomass. In 2010, oil accounted for
over half (54%) of Denmark’s indigenous
energy compared to 64% in 2004 when
domestic oil production peaked. The
share of natural gas in total energy
production was 31% in 2010 compared
to 34% in 2008. In 2009, the remaining
15% of indigenous energy production
came mainly from biomass (12%) and
wind power (3%). Denmark generated
38.6 TWh of electricity in 2010, largely
from coal (44%), natural gas (20%) and
wind power (20%). In 2010, Denmark
imported 10.6 TWh of electricity mostly
from Norway and Sweden, and exported
11.7 TWh mostly to Germany.
In 2010, biogas contributed 4,278 TJ
to the production of renewable energy,
representing 3 %. of the total renewable
energy production. The production is so
far spread out to 20 large common biogas
plants and 50-60 farms with biogas
plants. The common biogas plants have
the capacity to treat 100-600 tons of
manure and other kinds of biomass per
day and the biggest common biogas plant
treats manure from 50-100 livestock
herds in the area. Farms with biogas have
capabilities within a range of 10-100 tons
of manure per day. Future plants, for
both common biogas plants and farms
with biogas, will be larger because of the
economic benefits.11 Furthermore there
are 65 treatment plants in Denmark
with digester and biogas production.
Market Handbook Biogas
A few industries have their own biogas
production and there are about 30
large and small landfills, which abstract
and utilize biogas as well.12 They treat
approximately 400,000 tons of organic
waste which primarily come from the
food industry.13 The largest unexploited
potential lies in manure-based biogas
plants. About 30 CHP plants use biogas
as fuel and some 147 local CHP plants
– with a combined capacity of 80 MW – 105
use biogas as a fuel.
11 Danish Energy Agency http://www.ens.dk/da-DK/
UndergrundOgForsyning/VedvarendeEnergi/bioener-
gi/Biogas/Documents/Biogas-notatpct.20tilpct.20Kli
makommissionenpct.20majpct.202010.pdf
12 Biogaspotentiale i danske kommuner, Energinet.
dk
13 Biogasanlæg bidrager til et bæredygtigt landbrug,
Videncentret for Landbrug
 The gas grid is able to receive biogas
and the first commercial upgrade facility
for biogas was established in 2012. The
first biogas will run into the existing gas
grid by the end of 2012.14 In time this
development will give the producers of
biogas a more flexible market on which
they can distribute their production.
By the end of 2013 an analysis of the
future use of the gas infrastructure will
be drawn up – the analysis will contain
both the transition phase during which
natural gas is still used and a future phase
in which biogas and other renewable gas
takes over. The Danish government has
set aside 0.27 million € (2 million DKK)
for this analysis.
3.5.7. Regulation
Market Handbook Biogas
Today, most municipalities have not laid
out specific areas for the construction of
biogas plants in their local plans. In cases
where farmers / biogas operators wish
to establish a biogas plant in an open
countryside and outside the generally
designated industrial areas a municipal
and a local plan have to be processed.
This includes a mandatory VVM and an
environmental approval process before
construction can begin. The emission
106 limits are regulated by the Environmental
Protection Agency.
14 Energinet.dk
3.5.8. Project Financing
Investments in Danish markets
are considered to be ‘safe’ from a
country risk perspective, according to
established rating agencies. Reliability
and credit worthiness of the Danish
economy is rated with best scores at
Standard & Poor’s15 and Moody’s. In the
COFACE country risk rating16 Denmark
positions itself at the top of the list of
countries, and the same is the case in
the Corruption Perception Index rating
the level of transparency.17 The ease of
doing business is considered to be quite
favourable in Denmark by IFC World
Bank.18
When the Maastricht Treaty was con-
cluded in 1992, Denmark obtained an
‘opt-out’ under which it did not need
to enter the third stage of Economic
and Monetary Union and therefore did
not introduce the Euro. The Danish
Krone has remained within the EMS and
has been part of the new exchange-
rate mechanism (ERM II) since the
introduction of the euro. It may fluctuate
within a 2.25% band on either side of
the Euro.19 The average inflation rate in
the period 2006 to 2010 was 2.1%.
15 Standard & Poor’s, http://www.standardand-
poors.com/ratings/en/eu/
16 COFACE, http://www.coface.com/CofacePor-
tal/COM_en_EN/pages/home/risks_home/coun-
try_risks/rating_table?geoarea-country=COUN_
AREA_04&crating=&brating
17 Corruption perceptions index 2011, http://cpi.
transparency.org/cpi2011/results/
18 IFC, Doing Business Index, http://www.doing-
business.org/rankings
19 http://europa.eu/legislation_summaries/econo-
mic_and_monetary_affairs/institutional_and_econo-
mic_framework/l25061_en.htm
Inflation is not expected to stay within
the euro target area of just below 2%
in 2011. For 2011 and 2012 inflation is
expected lie around 2.6% and 1.8%.20
The easiness of getting a credit from
banks is dependent on individual project
designs as they assess reliability of
chosen technology as well as feedstock
supply security and price risks. The
financing of investments in biogas plants
is supported by a start-up aid of 30% of
the investment for new biogas projects.
The remaining funds can be provided by
a 60% municipal-guaranteed loan and
10% own financing. and Germany. It is responsible for
3.5.9. Readiness for Uptake
Key institutions:21
The Danish Ministry of Climate, Energy
and Building (previously known as
the Ministry of Climate and Energy),
established in November 2007, was
created as a part of the government’s
increased efforts to promote a greener
and more sustainable society. The
ministry is responsible for national and
international efforts to mitigate climate
change, as well as for energy, national
geological surveys in Denmark and
Greenland, and for meteorology.
The Danish Energy Agency (DEA) was
established in 1976, and is an agency
under the Ministry of Climate, Energy
and Building. It is responsible for all tasks
related to the production, transmission
20 http://www.euo.dk/nyheder/euidag/2011/maj/
foraarsprognose2011/
21 Energy Policies of IEA countries, Denmark 2011
review
and utilisation of energy, and its impact
on climate change. Its principal function
is to ensure the legal and political
framework for reliable, affordable and
clean supply of energy in Denmark.
Energinet.dk, the transmission system
operator, is an independent public
enterprise owned by the Danish State
represented by the Ministry of Climate,
Energy and Building. It owns the natural
gas transmission system and the 400
kV electricity transmission systems
and is the co-owner of the electricity
interconnections to Norway, Sweden
maintaining security of supply and
ensuring the smooth operation of the
market for electricity and gas. Energinet.
dk was established in 2005 following a
merger between Eltra, Elkraft System,
Market Handbook Biogas
Elkraft Transmission and Gastra.
The Danish Energy Saving Trust is
an independent body established in
2010 as a trust under the auspices of
the Ministry of Climate, Energy and
Building, replacing the Danish Electricity
Saving Trust. The scope of the previous
organisation’s work has been expanded
from electricity savings to cover savings
and more efficient use of all forms
of energy in every sector other than 107
transport.
The Danish Energy Regulatory Authority
(DERA) oversees the electricity, natural
gas and district heating markets. DERA
is an independent authority and its board
members are appointed by the Minister
of Climate and Energy. Its decisions can
be appealed to the Danish Energy Board
 of Appeal.
The independent Danish Commission on
Climate Change Policy was established
by government in 2007 and was charged
with the task of identifying the long-term
climate and energy policies needed to
achieve independence from fossil fuels.
The Climate Commission’s proceedings
were attended by the Ministry of Climate,
Energy and Building, the Ministry of
Economic and Business Affairs, the
Ministry of the Environment and the
Ministry of Finance. The Commission
published its findings in September 2010
and ceased activities in November 2011.
Market Handbook Biogas

108
3.6. Sweden

Swedish Bioenergy Association

(Svebio)
Lena Dahlman
Torsgatan 12
SE-11123 Stockholm
Tel.: +46 8 441 70 80
Email: lena.dahlman@svebio.se

3.6.1. Country Score

Country Score Sweden Middle Norrland - Biogas (November 2011)

In the general sco-
ring for sector, Swe-
den - Middle Norrland
is rated place 54 out of
total 81. The underly-
ing categories that in-
fluence this result are
displayed in the bar

Market Handbook Biogas

chart.

Country Score Sweden Middle Norrland - Biomethane (November 2011)

In the general sco-

ring for sector, Swe-
den - Middle Norrland
109
is rated place 51 out of
total 81. The underly-
ing categories that in-
fluence this result are
displayed in the bar
chart.
 3.6.2. Basic Data
With a surface of 450,295 km², Sweden
is the third largest country in the EU;
however, with a total population of
about 9.4 million it is only the fourteenth
most populated one. The population
density is on average 21 inhabitants per
km² with the population being mostly
concentrated in the southern half of the
country. About 85% of the population
lives in urban areas. Sweden consists of
eight NUTS2 regions. Sweden’s capital
city is Stockholm, which is also the
largest city. The country is characterised
by its long and narrow shape with the
main part of the population spread over
the middle and southern parts of the
country. Hence, agricultural practices
and available feedstock differ amongst
regions. Also energy needs, energy
Market Handbook Biogas
dependence, and/or limitations of the
transportation of goods and people differ
significantly amongst the regions.
Useful links:
Facts and Figures:
• Official Swedish Statistics
• Swedish gas vehicle info page
• Biogas portal
110 • Swedish Energy Agency
• Swedish Board of Agriculture
• Swedish Forest Agency
• Green electricity trading market
• Energikunskap, Energy knowledge pu-
blished by the Swedish energy agency
3.6.3. Energy policy
The Sweden aims at reaching a share of
RES in the final energy consumption of
50% by 2020. Since in 2011 the share of
renewable energy already summed up
to 48.9%, the target set for 2020 cannot
be seen as ambitious. The same holds
true for the 2020 target with regards
to the transport sector which has to
include a 10 % share of RES. According
to the estimations of the Swedish energy
agency, these targets will already be
reached in 2012. Until 2013, all biogas
used for transportation is omitted from
energy or carbon taxation; however,
at this point no information regarding
the incentive structure after the 31st
of December 2013 is available. There
are discussions to include biogas for
transport in a future quota system, which
would undermine the market completely.
However, as such large investments have
been executed in infrastructure and
production units, it must be assumed
that a future incentive structure will still
protect the gas vehicle market. Due to
the uncertainty in policy, the expansion
rate for new biogas production sites is
rather slow at the moment. With regards
to biogas used for electricity generation
or heating/cooling, there are no current
discussions on subjecting these volumes
to an energy or carbon tax. Whilst green
electricity from biogas is supported, fossil
energy fuels are taxed heavily. Natural
gas is not taxed to the same extent as
coal and oil since is it only subject to the
carbon tax but not the energy tax.
There have been discussions to additionally
introduce a carbon reduction support for
biogas installations; however, this has
yet to be realized. As Sweden has already
met the 2020 target, the political will to
introduce new, costly support schemes
is rather low. Nevertheless, additional
policies and incentive structure need to
be put in place in order for Sweden to
reach its long-term ambitions: in 2050
Sweden shall have no net CO2 emissions
and in 2030, the vehicle fleet shall
be independent of fossil energy. The
government has started to discuss how
to meet these targets but there will be
no clear policy in place before 2014.
Useful Links:
Institutions:
• Swedish Energy Agency
• Swedish government
• Swedish Board of Agriculture
• The Swedish Enforcement Administra-
tion
• Svenska Kraftnät (Swedish national
grid)
• Swedish Transport Agency, Trans-
portsstyrelsen
Associations:
• Swedish Farmers Union
• Swedish Waste Management
• Swedish Energy gas Association
• Biogas Syd
• Biogas Sydost
• Biogas Väst
• Biogas Öst
• Biogas Mitt
• Biofuel region
3.6.4. Feedstock
Due to the fact that merely 6.5% of the
total surface area is used for agriculture,
Sweden’s agricultural feedstock supply
for the biogas sector is relatively small
in relation to its total size. The total
surface area covered by forest is 63%
(or 48% productive forest lands) making
forest based fuels the biggest biomass
source for bioenergy. However, there is
still a large unused potential of available
feedstock for the increased production of
biogas from sources such as agriculture,
forestry, households, restaurants, and
the industrial processing industry.
Approximations of the feedstock potential
Market Handbook Biogas
for biogas in Sweden however vary
greatly. The biogas strategy issued by
the Swedish energy agency in 20101 has
been criticized by the biogas associations
and stakeholders in Sweden for being too
conservative in their estimations. The
regional Biogas organisations: Biogas
Syd (south), www.biogassyd.se; Biogas
Sydost (South east), www.biogassydost.
se; Biogas Väst (west), www.biogasvast.
se; Biogas Öst (East), www.biogasost.se; 111
Biogas Mitt (Middle), www.biogasmitt.
se; Biofuel region (in the North), www.
biofuelregion.se have all conducted local
estimates that show higher potentials.2
1 Förslag till en sektorsövergripande biogasstrategi
– slutrapport ISSN 1403-1892
2 Contact each association directly as the regulare-
ly update their assessments
 The main discrepancies of the estimates
are differences in the assessments of
production costs, which the Swedish
energy agency has estimated more
conservatively.
As Sweden is stretched very widely
on a longitudinal level, the feedstock
availability differs between the different
NUTS regions. The highest number of
large-scale farms as well as the highest
density of farms can be found in the most
southern regions of the country, followed
by the ones located in the middle.
Despite the fact that there are very
few farms that produce enough manure
to operate a biogas plant profitably in
the north of Sweden, one of the largest
biogas plants can be found within Domsjö
Fabrikerna AB; Örnsköldsvik where the
feedstock is reject water from the textile
Market Handbook Biogas
pulp production. Swedish agriculture
is relatively small-scale compared to
central Europe which makes feedstock
more spread out over the landscape.
The major feedstocks are organic house
hold waste, manure, sewage, industrial
organic waste, and remnant gas from
closed landfills. Agricultural products
and energy crops are very rarely used.
Useful Links:
112 Facts and Figures:
• Offical Swedish Statistics
• Swedish gas vehicle info page
• Biogas portal
• Swedish Energy Agency
• Swedish Board of Agriculture
• EUROSTAT
Associations:
• Swedish Farmers Union
• Swedish Waste Management
• Swedish Energy gas Association
• Biogas Syd
• Biogas Sydost
• Biogas Väst
• Biogas Öst
• Biogas Mitt
• Biofuel region
3.6.5. Business Case
Biogas production in Sweden is not
price-competitive relative to natural
gas, as natural gas is exempted from
energy tax. However, due to the large
public and political support of the biogas
for transportation sector, additional
support incentives for biogas are being
discussed. The vehicle gas sold in
Sweden is a mix of biogas and natural
gas (30-50 % biogas content, national
average 2011: 60 % biogas 40 % fossil
natural gas). The fact that natural gas is
exempted from the energy tax creates a
stable vehicle gas price on the one hand
but also puts a price pressure on biogas
on the other hand. Generally, vehicle
gas is between 72-80 % cheaper than
gasoline, but the prices vary regionally
depending on the local production prices
of biogas. As most of the electricity and
heat from biogas is used locally and
only rarely sold on the open markets,
these market volumes are not as price
sensitive.
Despite the fact that biogas for vehicles
is not taxed at all, it remains difficult
to create viable business margins due
to the high infrastructural investment
costs related to upgrading and fuelling
stations, as well as the relatively low
price of natural gas.
Electricity from biogas as well as green
electricity from other RES are eligible for
green electrical certificates.3 Whereas
producers of renewable electricity are
issued green electricity certificates that
they can then choose to sell on the open
market, other electricity providers or
buyers have to buy a certain amount
of green electricity certificates. The
price for the certificates is, therefore,
determined by the market. So far, the
green certificates have added 50 – 100 %
to the actual market price. As the prices
one applies for already commercially
available techniques in Sweden and the
other one for new technologies.
Farmers and companies in rural areas of
southern Sweden can get up to 30 % of
their investments cost refunded, whilst
for installations in the northern part of
Sweden this support can amount up to
50 %. However, the total investment aid
cannot be larger than 1.8 million SEK
distributed over a three year period,
and the biogas production has to be
based on manure. These restrictions
favour smaller installations, since larger
cooperations, consisting of several
companies, risk hitting the 1.8 million
sealing.
Useful links:
Facts and figures:

Market Handbook Biogas

of these green electricity certificates are • Swedish Energy Agency
set by the market instead of being fixed
• Swedish Board of Agriculture
by legislation, they might fluctuate over
time.4 However, the prices tend to be • Official Swedish Statistics
relatively stable over longer periods and • Swedish gas vehicle info page
predicted values of a green certificate
are regularly published on Nordpoolspot. • Biogas portal
com. Support schemes:
Currently, incentives regarding biogas • Swedish Energy Agency
consist of a reduced vehicle tax for a
• Swedish Board of Agriculture 113
period of five years for new cars, and
a 20 % reduced taxable value of fringe • The Swedish Enforcement Administra-
benefits. The reduced fringe tax is only tion
in place until 2013. Investments in new • Svenska Kraftnät (Swedish national
biogas facilities are incentivised by two grid)
investment support systems, whereas
• Swedish Transport Agency, Trans-
3 Law on green electricity certificates (2011:1200),
in Swedish - http://www.notisum.se/rnp/sls/
portsstyrelsen
lag/20111200.htm
4 Offical trading site for green electricity certificates
http://www.nordpoolspot.com/
 Associations: 3.6.6. Market Envionment
• Swedish Farmers Union Bioenergy is the country’s largest energy
• Swedish Waste Management source and around 140 TWh thereof are
used annually. Bioenergy surpassed oil
• Swedish Energy gas Association
as the major energy source in 2009,
• Biogas Syd and bioenergy usage is bigger than that
• Biogas Sydost of hydro and nuclear power combined.
The majority is used by the industry,
• Biogas Väst followed by domestic small-scale heating
• Biogas Öst and district heating systems. Sweden
• Biogas Mitt has managed to increase its use of
bioenergy by 100 TWh (almost 10 mtoe)
• Biofuel region during the last 40 years. The transition
has accelerated over time, and during
the last decade the growth of the sector
has been 3 – 4 TWh per year (see Figure
‘Final Energy Use’.
Figure ‘Final Energy Use’: Bioenergy is
the leading energy source in Sweden to-
Traditionally the majority of biogas
day. Final energy use by source 2011. plants have been internal production
Market Handbook Biogas

units in sewage cleaning facilities or

small-scale farm installations designed
for personal use. The pioneers in biogas
production have been municipalities that
have started to produce biogas from
household waste as a climate protection
initiative. In the beginning, biogas has
been used in public transportation and
waste handling, but, due to the increase
in public interest there has been a rapid
increase in investments in upgrading
114 stations for agricultural and sewage
biogas installations. This has been done
in order to meet the high public demand
for vehicle gas and to secure the supply
in bigger cities.

Source: Svebio based on statistics from

In 2010 229 biogas production units
Swedish Energy Authority were installed in Sweden. Of these,
135 were sewage plants, 5 industrial
plants, 18 combined fermentation plants
(organic waste and manure) owned
by municipalities, 57 collection sites
for remnant gas from closed landfills,
and 14 farm instalments. The largest
plants are made up of the industrial
and sewage plants, whilst landfill and
farm instalments constitute the smaller
plants. The largest biogas production can
be found in the large cities, indicating
the large dependence on organic waste
and sewage plants.
Of these 229 plants mentioned above,
only around 40 have the capacity to
upgrade biogas into vehicle gas, and
only in seven cities upgraded gas can be
inserted into the natural gas grid.
What makes the Swedish biogas market
unique is the great use of gas vehicles.
There are around 33 000 gas vehicles
in Sweden but only around 133 fuelling
stations. Around 96 % of these fuelling
stations are located south of Stockholm,
whereas up in the northern part of
Sweden there are only 5 fuelling stations
for vehicle gas (Gävle, Sundsvall,
Skellefteå, Boden, and Östersund). Due
to the tax exemption of natural gas from
the energy tax, it is difficult for biogas to
compete with natural gas. However, the
biogas production in Sweden is to some
extent subsidized by natural gas, as the
market demands that the mix of vehicle
gas is to be mostly made up of biogas.
Since natural gas cannot become the
major vehicle gas fuel, a low natural gas
prices tend to keep vehicle gas prices
down to some extent.
To simplify biogas injection into natural
gas grids, the so-called Green Gas
Principle has been inserted in the Swedish
tax regulation. Through this Principle,
biogas that is injected in the market or
grid in one region can be exchanged
for the natural gas volume that would
have been sold somewhere in the same
grid. Hence, this principle facilitates the
spread of biogas to regions that do not
produce enough biogas to meet their
market demand.
Sweden’s infrastructure for producing,
disseminating, and utilizing biogas
however cannot be considered as
optimal. There are only two natural
gas grids networks: one in the county
of Västra Götalands län close to
Gothenburg, and one in Skåne län close
to Malmö and Helsingborg. The relative
amount/volume of biogas distributed in
these natural gas grids is still very low.
Market Handbook Biogas
All other biogas installations are off-grid,
and are most commonly used in sewage
treatment plants, municipal waste plants
or agricultural installations. Almost all
biogas plants in Sweden are based on
wet fermentation technologies. Only
one plant, which is being constructed
in 2012, will have a dry fermentation
set up. Since the use of agricultural
waste or dedicated energy feedstock
is not common in Sweden, agricultural 115
plants mostly utilize manure as the main
feedstock.
Due to the fact that traditionally all
biogas produced has been used for
the generation of electricity and heat,
biogas developments in Sweden have
started in sewage plants where the
energy generated has been used within
the water treatment process. Biogas
 generation from landfills have also been
relatively common since the beginning
of 2000. However, following the boom
of biogas on the transport market, a
larger part of almost 50% of all biogas
produced in Sweden is being upgraded
to vehicle fuels. As the market for biogas
for transport is one of the fastest growing
renewable energy markets in Sweden,
the relative amount of biogas being
upgraded to vehicle gas is expected to
continuously grow.
Useful links:
Facts and Figures:
• Swedish Energy Agency
• Swedish Board of Agriculture
• Official Swedish Statistics
• Swedish gas vehicle info page
Market Handbook Biogas
• Biogas portal
Associations:
• Swedish Farmers Union
• Swedish Waste Management
• Swedish Energy gas Association
• Biogas Syd
• Biogas Sydost
• Biogas Väst
116
• Biogas Öst
• Biogas Mitt
• Biofuel region
3.6.7. Regulation
The approval of biogas and biomethane
plants with an installed electric capacity
of up to 500 kW by authorities takes
approximately 12 months on average.
For larger biogas plants with installed
electric capacity bigger than 500kW
the approval takes about 20 months.
Of course approval periods vary from
authority to authority, depending on their
workload, skilled personnel, and local
conditions. With regards to the planning
and construction of a biogas plant, local
and regional authorities are generally in
favour of such an endeavour. Neighbours,
however, are often worried regarding
odour and pest control. It is therefore
important to inform stakeholders in due
time of the planning process.
There is no specific regulation for
biogas instalments in the Swedish
environmental law,5 this means that
biogas operations are bound to the same
odour, noise and emission thresholds
as all other plants. Threshold levels for
emissions are only relevant for plants
that burn biogas to produce electricity
and/or heat. Emission thresholds and
regulations differ according to the size
of the plant and the feedstock that it
uses. The larger the installation, the
stricter the environmental demands.
The Swedish Environmental authority
provides local and regional authorities
with recommendations of how to set
environmental permit thresholds.
Biogas specific regulations can be found
with regards to the handling of feedstock
5 Swedish environmental law http://www.notisum.
se/rnp/sls/lag/19980808.HTM
and the sanitation of digestate. In case MW). For the largest plants (>50 MW)
the plant operates on water treatment the demands of reporting are higher and
sewage, the digestate cannot be more information is required to be given
spread, or mixed with other digestate to the authorities.
without a specific permit. Similarly, if Useful Links:
manure or other animal by-products
originating from farms, other than the Regulations:
operator’s, are used as feed-stock, the Green electricity certificates:
digestate has to be sanitized according
• Lag (2011:1200) om elcertifikat
to the certification rules for digestate
SPCR 120 (Swedish Certification Rules • Miljöbalken, Swedish environmental
for Biofertilisers). If the digestate is law
spread on the farmers own land and Swedish energy taxation:
not in areas used for food production
the regulations are milder. The same • Lag (1994:1776) om skatt på energy
regulations are found in instalments Institutions:
that handle household waste. Permitting
• Swedish Energy Agency
authorities are often hesitant towards
the spreading of digestate in farm areas. • Swedish Board of Agriculture
Generally, the digestate is spread on • Swedish Environmental Agency

Market Handbook Biogas

bioenergy production fields or used as
filling of close landfills. In specific cases, Associations:
digestate from biogas production can be • Swedish Farmers Union
certified as plant soil material; however,
• Swedish Waste Management
the regulations regarding bacterial
growth and sanitation control are strict. • Swedish Energy gas Association
All plants under an environmental • Biogas Syd
permit in Sweden must verify that they • Biogas Sydost
meet their permits emission thresholds
and other conditions. The proof of • Biogas Väst
compliance with the permit has to be • Biogas Öst 117
verified regularly and should be in place
• Biogas Mitt
if/when there is an inspection from
the permitting authority. Moreover, • Biofuel region
larger installations (>500 kW installed
bioenergy capacity) are often required
by their permitting authority to hand in
an annual report. This environmental
report is obligatory for larger plants (>
total installed bioenergy capacity 20
 3.6.8. Project Financing
According to established rating agencies,
investments into Swedish markets are
‘safe’ from a country risk perspective.
Reliability and credit worthiness of
the Swedish economy is rated with
best scores at Standard & Poor’s6 and
Moody’s. Also in the COFACE country
risk rating Sweden positions itself at
the top of the score.7 The same holds
true for the Corruption Perception Index
measuring the level of transparency.8
Whilst the ease of doing business in
Sweden is regarded as quite well by IFC
World Bank, starting a business is ranked
relatively low due to high administration
and regulation requirements.9
Although Sweden is not a member of
the Eurozone and therefore currency
Market Handbook Biogas
exchange risks have to be taken into
consideration, the Swedish Krona and
the Swedish state budget follow the
ordinates of the EU leading to only minor
currency fluctuations.
The biggest problem with regards to
financing biogas projects in Sweden
is the uncertain policy and subsidy
situation. Therefore, it might be difficult
to attain financing for biogas projects
even though there is direct support for
118
the construction of biogas plants in
6 Standard & Poor’s, http://www.standardand-
poors.com/ratings/en/eu/
7 COFACE, http://www.coface.com/CofacePor-
tal/COM_en_EN/pages/home/risks_home/coun-
try_risks/rating_table?geoarea-country=COUN_
AREA_04&crating=&brating
8 Corruption perceptions index 2011, http://cpi.
transparency.org/cpi2011/results/
9 IFC, Doing Business Index, http://www.doing-
business.org/rankings
place. Farmers and companies in rural
areas of southern Sweden can get
up to 30 % of their investments cost
refunded, while the investment support
for installations in the northern part
of Sweden can amount up to 50 %.
Overall, the total investment aid cannot
be larger than 1.8 million SEK spread
over a three year period. Furthermore,
the biogas production has to be based
on manure. This scheme favours smaller
installations, as larger cooperations
stand a risk of hitting the 1.8 million
sealing.
Many projects are initiated by munici-
palities or local bus companies. If this
is the case, initiators often agree on a
long-term procurement contract at a set
price: These prices are often relatively
high compared to the open market. This
aids in the acquirement of loans from
official banks.
Useful links:
Rating agencies:
• Standard & Poor’s
• Moody’s
• COFACE
• Corruption Perception Index
• IFC Doing Business
Project financing institutions:
• Swedish Board of Agriculture
• Swedish Energy Agency
 3.6.9. Readiness for Uptake
Generally, biogas is very popular
amongst customers and politicians in
Sweden, although in some areas the
so-called NIMBY (not in my backyard)
effect can hinder development. There
are two well developed biogas markets –
one for electricity and heat, and one for
transportation – that both have logistics
and market instruments in place. Biogas
as an energy source is well known
for its positive climatic effect and the
opportunities it offers with regards to
nutrient cycling. The readiness for uptake
is considered to be good. There are no
plants that have difficulties to sell their
electricity or vehicle gas. Overall, there
is a large biogas deficit all over Sweden
compared to the market demand. Many
politicians and regions therefore actively
support biogas production plans. The
biggest difficulty for most projects
that are not initiated by authorities, is
to operate on a profitable level, since
biogas has to compete with natural gas
prices. Another obstacle is the fact that
the major market demand in Sweden
is for vehicle gas, which increases the
costs for small biogas plants to an extent
that makes it impossible to finance the
production for other purposes than local
electricity and heat production. Many
smaller plants are therefore building raw
biogas grids connected to a central and
jointly owned upgrading station.
When planning to invest into a biogas
plant, it is helpful to consult related
associations and support agencies
on how to proceed in the best way.
Usually, there is a lot of know-how and
experience available that can be used
to avoid common mistakes within the
planning process and to get support in
the implementing process. As you can
see below, there are several regional
biogas interest organisations in Sweden,
which provide support in the planning
and implementation process, and offer
in depth feedstock and market data.
Useful links:
Facts and Figures:
• Offical Swedish Statistics
• Swedish gas vehicle info page
• Biogas portal
• Swedish Energy Agency
• Swedish Board of Agriculture
Market Handbook Biogas
• EUROSTAT
Associations:
• Biogas Syd
• Biogas Sydost
• Biogas Väst
• Biogas Öst
• Biogas Mitt
• Biofuel region
119
Institutions:
• Swedish Energy Agency
• Swedish Board of Agriculture
 3.7. Latvia

Latvian Biomass Association

(LATbio)
Didzis Palejs
Jaunbumani, Dreilini
LV - 2130 Stopinu distirct
Tel.: +37 1 67522399
Email: didzis.palejs@latbionrg.lv

3.7.1. Country Score

Country Score Latvia - Biogas (November 2011)
In the general
scoring for sec-
tor, Latvia is ra-
ted place 81 out
of total 81. The
underlying cate-
gories that influ-
ence this result
Market Handbook Biogas

are displayed in
the bar chart.

Country Score Latvia - Biomethane (November 2011)

In the general
scoring for sec-
tor, Latvia is ra-
120 ted place 81 out
of total 81. The
underlying cate-
gories that influ-
ence this result
are displayed in
the bar chart.
 3.7.2. Basic Data
Latvia, officially the Republic of Latvia, is
located in the Baltic region of Northern
Europe. It is bordered by Estonia in
the north, by Lithuania in the south,
by the Russian Federation in the east,
by Belarus in the southeast and it has
a maritime border with Sweden in the
west. Latvia is a unitary parliamentary
republic and it is divided into 118
administrative divisions of which 109
are municipalities and 9 are cities. The
capital of Latvia is Riga; about one third
of the country’s population lives there.
The official language is Latvian and the
currency is called Lats (Ls).
There are five planning regions of Latvia:
Kurzeme, Latgale, Riga, Vidzeme,
and Zemgale. The planning regions of
Latvia are not administrative territorial
divisions.
With 2,229,641 inhabitants and a
territory of 64,559 km2 it is one of the
least populated countries of the EU.
There are 5 cities with more than 50,000
inhabitants.
Latvia has a humid semi-continental
climate characterized by warm summers,
freezing winters and frequently high levels
of humidity and precipitation. Latvia’s
weather conditions are influenced by the
proximity of the Baltic Sea.
Latvia has four pronounced seasons of
near-equal length. Winters, starting in
mid-December and lasting until mid-
March, have average temperatures of
around – 6°C and they are characterized
by a stable snow cover, bright sunshine,
and short days. Severe spells of winter
weather with cold winds, extreme
temperatures of around –30° and heavy
snowfalls are common. Summers,
starting in June and lasting until August,
are usually warm and sunny with cool
evenings and nights. Summers have
average temperatures of around +19°C
with extremes of +35°C. The weather in
spring and autumn is fairly mild.
There are three major ports in Latvia:
Liepaja, Riga and Ventspils. Seven
smaller ports are Skulte, Mersrags,
Salacgriva, Pavilosta, Roja, Lielupe, and
Engure; they are situated along the
entire coastline of Latvia.1
3.7.3. Energy Policy
Latvia is facing challenges to ensure
Market Handbook Biogas
sustainability, both in general
development and in the energy
sector. The energy section of Latvia’s
Sustainable Development Strategy
2030 identifies several goals: renewable
and safe energy, reduced dependency
on energy imports, the use of local
renewable sources, increased energy
efficiency, and the formation of a joint
regional energy market.
Pursuant to Annex I (A) to Directive 121
2009/28/EC, Latvia’s target is to increase
the use of RES from 32.6% of GFEC in
2005 to 40% in 2020. The total amount
of RES to be utilized in 2020 is 1918
ktoe. Latvia’s RES targets by 2020 and
beyond are the following:
1) By 2020, the share of renewable energy
1 Latvia in brief. Latvian Institute. http://www.lat-
via.eu/content/latvia-brief
 in total gross final energy consumption
has to be increased to at least 40% and
further thereafter;
2) By 2020, the share of renewable
energy in the transport sector must
reach at least 10% of gross final energy
consumption for transport and it has to
be increased gradually thereafter.2
The Law on Renewable Energy still
has not been passed by the Saeima.
The draft Law on Renewable Energy
specifies measures and targets for
renewable energy generation and the
total final energy consumption that must
be achieved by 2020, and provides for
financial instruments to promote the use
of renewable energy.
The main measures in the National
Renewable Energy action plan are:
Market Handbook Biogas
• The right to sell generated electrici-
ty through the mandatory purchase of
electricity in terms of quantity (Cabinet
Regulation No 262 of 16.03.2010);
• The right to receive guaranteed pay-
ment for the electrical capacity installed
in a power plant (Cabinet Regulation No
262 of 16.03.2010);
• The technology transfer from fossil to
RES;
122
• The support for the implementation
of energy generating installations using
2 Information Report Republic of Latvia NREAP for
implementing Directive 2009/28/EC of the European
Parliament and of the Council of 23 April 2009 on
the promotion of the use of energy from renewable
sources and amending and subsequently repealing
Directives 2001/77/EC and 2003/30/EC by 2020.
http://www.ebb-eu.org/legis/ActionPlanDirecti-
ve2009_28/national_renewable_energy_action_
plan_latvia_en.pdf
biomass, biogas, or biofuels to genera-
te heat energy (draft Law on Renewable
Energy).
Current RES support instruments in
Latvia:
• National regulations for feed in tariffs
from RES;
• Particular regulations for electricity
produced in CHP;
• Financial support for the investment
in biogas plants (Support Rural Deve-
lopment Programme for agriculture type
RES energy plants – up to 40% of in-
vestment, National climate finance inst-
rument – up to 50% of investment etc.);
• NEFCO co-financing for investment in
biogas plants;
• Investment support for biomass tech-
nology and construction;
• Area payments;
• Support for creation of new, innovati-
ve techniques and technologies.
The main biogas development problems
are political-economical problems, the
quota on renewable electricity power
production (for biogas 6.9%-2009;
7.93%-2010 onwards), the project
financing, the non-availability of support
for biogas use as transport bio-fuel,
the weak initiative from industry about
anaerobic digestion (biogas production)
as environmental technology for waste
and sludge treatment.3
3 Biogas development status in Latvia. http://www.
monusminek.ee/documents/LAT_biogas_status_Tar-
tu_Motoshow_24.09.2010.pdf
 3.7.4. Feedstock
Most of the country is composed of
fertile lowland plains and moderate hills.
A typical Latvian landscape is a mosaic
of vast forests alternating with fields,
farmsteads, and pastures. Agricultural
land occupies 39% of Latvia’s territory.
Available farmland is 2,429,800 ha:
1,805,500 ha are cultivated and 624,300
ha are abandoned land available for
agricultural expansion.4 Forests cover
44.1% of Latvia’s territory.5
Feedstock potential for biogas in Latvia
is rather high. During the last three
years there have been many studies
and attempts to evaluate the biogas
potential in Latvia. Biogas potential has
been evaluated in terms of produced
biogas amounts, as potentially produced
energy as well as capacity that could
be installed based on biogas production
amounts.
Potentially produced amounts of
biogas are basically divided into three
categories:
• Biogas production potential in Latvia is
100 to 200 million m3/year when organic
wastes and energy crops from existing
agricultural practices are used;
• Biogas production potential in Latvia is
around 300 million m3/year when orga-
nic wastes and specially grown energy
crops are used;
• The maximum biogas production po-
4 Central Statistical Bureau. Statistics database
2011. http://www.csb.gov.lv.
5 Nature and Environment in Latvia. Latvian Insti-
tute. http://www.latvia.eu/content/nature-and-envi-
ronment-latvia
tential in Latvia is up to 1 200 million
m3/year if all currently unused agricultu-
ral land were used to grow energy crops
for biogas production.
According to the Latvian Biogas Production
and Development Programme 2007-
2011 the biogas production potential is
estimated at approximately 174,000,000
m³/year.6
According to a report on the promotion
of the use of energy from renewable
sources published by the Ministry of
Economics in 2011, Latvia produced the
following volumes of biomass which can
be used for biogas production in 2010,:
perennial grass, hay green feed, silage
– 2139.7 thousand tons, corn silage
and green feed – 209.0 thousand tons.
The volumes of energy crops (except
forage, seed, losses and stocks) which
Market Handbook Biogas
may be used for energy production were
as follows: cereals – 7.7 thousand tons,
rape – 1.2 thousand tons.7
Latvia has a considerable potential
for growing raw materials for biogas
production. According to collected
data, cattle manure produced in
2010 could be used to generate 32.2
million m3 of biogas, while available
6 Latvian biogas production and development pro- 123
gramme 2007-2011. http://www.vidm.gov.lv/lat/
darbibas_veidi/atjaunojamie_energoresursi/files/
text/Darb_jomas/Biogazes_raz_un_izmant_att_
pr_2007-2011.doc
7 Information Report Republic of Latvia NREAP for
implementing Directive 2009/28/EC of the European
Parliament and of the Council of 23 April 2009 on
the promotion of the use of energy from renewable
sources and amending and subsequently repealing
Directives 2001/77/EC and 2003/30/EC by 2020.
http://www.ebb-eu.org/legis/ActionPlanDirecti-
ve2009_28/national_renewable_energy_action_
plan_latvia_en.pdf
 slaughterhouse residues were evaluated
at 2.1 million m3. The use of biogas for
energy production deals with complex
agricultural production, processing and
recycling of biodegradable products as
well as derived products management,
reducing soil, water and air pollution,
that constitute potential risks to human
health.
According to data of the Central Statistical
Bureau, 556 farms have at least 150
cattle in their stables, and another 60
farms have more than 500 cattle in
their stables. The data furthermore
counts 1644 farms that have at least
125 ha cropland, which could facilitate
larger biogas CHP projects. Agricultural
land occupies 39% of Latvia’s territory.
Available farmland amounts to 2,429,800
ha. Currently, 1,805,500 ha are cultivated
Market Handbook Biogas
and 624,300 ha are abandoned and
therefore available for agricultural
expansion.8
3.7.5. Business Case
The main legal support mechanism with
regards to the feed-in of biogas is the
Electricity Market Law. The Electricity
Market Law ensures that a certain part
of the total consumption of electricity by
124 end users has to be electricity produced
from RES. The Electricity Market Law
also requires the public trader (JSC
Latvenergo) to purchase a certain
amount of electricity produced by RES.
The price of such electricity and the
amount to be purchased by the public
trader are determined by the Cabinet of
8 Central Statistical Bureau. Statistics database
2011. http://www.csb.gov.lv.
Ministers by the Regulations No 221 and
No 262:
• Cabinet Regulation No 262 adopted
on the 16th of March 2010 – ‘Regulati-
ons Regarding the Production of Electri-
city Using RES and the Procedures for
the Determination of the Price’ prescri-
bes conditions for acquiring rights to sell
electricity generated from RES within
the framework of mandatory procure-
ment. Support mechanisms are moni-
tored by the Ministry of Economics of
the Republic of Latvia which undertakes
the control of generators and maintains
the right to rescind decisions on rights
to sell electricity in case the rules are
being infringed within the framework of
mandatory procurement.
• Cabinet Regulation No 221 adopted
on the 10th of March 2009 – ‘Regulati-
ons Regarding Electricity Production and
Price Determination Upon Production of
Electricity in Cogeneration’ prescribes
the criteria for cogeneration units to
qualify for the right to sell the produced
electricity within the framework of the
mandatory procurement or to receive
guaranteed payment for the electric ca-
pacity installed in a cogeneration unit. 9
For example, the legally guaranteed
price for the electricity for 150 kW biogas
plants is 23 ct/kWh, and 20 cent/kWh
for 400-600 kW plants respectively. The
price depends on the capacity of the
biogas plants – the higher the capacity,
the lower the price. The guaranteed
duration of the biogas supports scheme
is 20 years.
9 Energy Policy. Ministry of Economics of Republic
of Latvia. http://www.em.gov.lv
Along with the feed-in tariff system to
promote electricity generation from
biogas, the Ministry of Agriculture,
Ministry of Economics and the Ministry
of the Environment are providing the
co-funding from EU financial support
instruments. Cabinet Regulation 268
stipulates that biogas plants can claim
40% in subsidies.
Another support programme
Development of Cogeneration Power
Plants Using RES – is aimed at significantly
increasing the volumes of electricity and
heat generated from renewable energy
sources. Support is provided to the
construction of new cogeneration power
plants using RES. The activity is financed
by the Cohesion Fund (12 March 2009
to 21 December 2013). The maximum
permissible funding intensity is 50 % of
the total eligible expenditure regardless
of the technology applied.
The Rural Support Service has a
support programme, the Modernization
of Agricultural Holdings, with a support
intensity of 25-70%.
3.7.6. Market Environment
The share of RES has traditionally been
significant in Latvia’s energy supply
and in 2008 it comprised 29.9% of the
total final energy consumption. In the
consumption structure for electricity, the
RES segment is made up of hydropower
plants, wind power plants, biogas power
plants, and biomass power plants, as
well as cogeneration stations utilizing
RES (see Table ‘RES Electricity’).
In 2009, 58 entrepreneurs received a
quota for biogas production with a total
installed electrical capacity of almost
54 MW. 9 new biogas power plants
were installed from 2008 to 2010. At
the beginning of 2012 there were only
23 biogas power plants with electricity
capacity of 28 MW in Latvia, 22 of them
are cogeneration plants. Latvia does not
produce biomethane at the moment.
– (see Figure ‘Plants Latvia’)
Previous studies on the potential of
biogas plants in Latvia show that almost
all the big pig and poultry farms are
potential Latvian biogas producers. In
the development programme ‘Biogas
Production and Use’ from 2007 to 2011
the biogas potential is thought to be
approximately 174 million m³/ year
(from manure – 95 (53%), biodegradable
household waste – 23 (13%), sewage
Market Handbook Biogas
sludge – 10.8 (6%), animal by-products
– 10.6 (6%), food processing waste, 23.0
(13%), and energy crops 16.8 (9%)).
However, the Latvian market shows
some disadvantages as well. The lack
of a unified national economic policy,
including agricultural policy is one major
factor hindering the development of the
biogas market. Furthermore, despite
the fact that there is experience of using
natural gas as vehicle fuel in Latvia, 125
the use of biogas as a transport fuel is
in a very early stage of development.
Finally, the distribution of quota has
been suspended until the 1st January
2013.In the period from 26th of May 2011
to the 1st of January 2013, the Ministry
of Economics of the Republic of Latvia
is not organizing any tenders for the
acquisition of rights to sell electricity
 Table ‚RES Electricity‘: Share of electricity generated from RES in Latvian gross
electricity consumption (%)
2005 2006 2007 2008 2009 2010 2011
Total share 48.4 37.7 36.4 41.2 49.2 48.5 41.9
Large hydro 46.3 35.9 34.3 39.0 46.9 45.9 38.5
power
plants
Small hydro 0.9 0.5 0.9 0.9 0.9 1.0 0.8
power
plants

Biomass 0.6 0.6 0.5 0.6 0.7 0.9 1.6

and biogas
power
plants

Wind power 0.7 0.6 0.7 0.8 0.7 0.7 1.0

plants
Source: Central Statistical Bureau. Statistics database 2011. http://www.csb.gov.lv
Market Handbook Biogas

Figure ‚Plants Latvia‘: Working plants (red) and plants in construction stage (green)

126

Latvian Biogas Association. http://www.latvijasbiogaze.lv/files/2%20-%20

Biog%C4%81zes%20ra%C5%BEo%C5%A1anas%20aktualit%C4%81tes.pdf
generated from RES within the
framework of mandatory procurement,
and the manufacturer cannot acquire
rights to receive guaranteed fees for the
installed electric capacity.10
Latvia’s legislation does not stipulate
any regulation that transmission system
operators should give preference to the
connection of generating installations
using RES.
Latvia does not have a legal framework
for the introduction of biomethane into
the grid. In accordance with Article 49
of Directive 2009/73/EC of the European
Parliament and Council of 13 July 2009
concerning common rules for the internal
market in natural gas and repealing
Directive 2003/55/EC (hereinafter –
Directive 2009/73/EC), Articles 4, 9, 37
and/or 38 shall not apply to Estonia,
Latvia and/or Finland until any of those
member states is directly connected
to the interconnected system of any
member state other than Estonia, Latvia,
Lithuania, and Finland. Permits for direct
lines were postponed until 4 April 2014.
(Section 15 of the Energy Law).11
The draft Law on Renewable Energy
provides for the stipulation of biogas
generators’ rights to receive biogas
certificates and biogas generators’ rights
10 Energy Policy. Ministry of Economics of Republic
of Latvia. http://www.em.gov.lv
11 Information Report Republic of Latvia National
Renewable Energy Action Plan for implementing Di-
rective 2009/28/EC of the European Parliament and
of the Council of 23 April 2009 on the promotion
of the use of energy from renewable sources and
amending and subsequently repealing Directives
2001/77/EC and 2003/30/EC by 2020. http://www.
ebb-eu.org/legis/ActionPlanDirective2009_28/natio-
nal_renewable_energy_action_plan_latvia_en.pdf
to acquire rights for biogas enriched to
natural gas quality to gain access and to
be transmitted in natural gas networks.
3.7.7. Regulation
Latvia’s electricity market has been
open since 2007. Electricity generating
plants using RES to generate electricity
may sell the generated electricity for a
negotiated (market) price or also claim
the State aid price.
RES electricity generating plants do not
have special conditions stipulated for
operation in the electricity market. They
must comply with the requirements
prescribed by the Electricity Market
Law.12
In order to start producing energy from
biogas in Latvia, it is necessary to receive
Market Handbook Biogas
the following permits:
1) Permission by the Ministry of
Economics to increase production
capacities or introduce new capacities;
2) License from the Public Utilities
Commission;
3) Permission by the system operator
for grid connection;
4) Decision by the Environmental State 127
Bureau about environmental impact
assessment or technical regulations
12 Information Report Republic of Latvia National
Renewable Energy Action Plan for implementing Di-
rective 2009/28/EC of the European Parliament and
of the Council of 23 April 2009 on the promotion
of the use of energy from renewable sources and
amending and subsequently repealing Directives
2001/77/EC and 2003/30/EC by 2020. http://www.
ebb-eu.org/legis/ActionPlanDirective2009_28/natio-
nal_renewable_energy_action_plan_latvia_en.pdf
 issued by the Regional Environmental
Board of the State Environmental
Service;
5) Integrated pollution permit issued by
the Regional Environmental Board of the
State Environmental Service;
6) GHG emission permit issued by the
Regional Environmental Board of the
State Environmental Service (in case
the rated thermal input exceeds 20MW);
7) If the energy producer wishes to
qualify for obtaining the right to sell the
electricity within the framework of the
mandatory purchase, it is necessary to
receive a decision issued by the Ministry
of Economics about granting the right to
sell the electricity within the framework
of the mandatory purchase or the rights
to receive the guaranteed payment for
Market Handbook Biogas
the capacity;
8) Heat and electricity tariffs approved
by the Public Utilities Commission;
9) Construction permits.
128
3.7.8. Project Financing
The ease of getting a loan from banks
is very much dependent on individual
project designs as the reliability of the
chosen technology as well as feedstock
supply security and price risks etc is
being assessed. Each bank in Latvia has
different credit conditions. In general
the interest rate for bioenergy projects
equals the general average interest
rate on the market. The interest rate
of each project is influenced by several
risk factors; thus, the key is definitely
not the purpose of loan. Ekodoma Ltd.
conducted a survey of Latvian financing
procedures among the biogas promoters
in Latvia in 2011. Results of the survey
show that there are difficulties with
financing biogas projects in Latvia. More
than half of all respondents say that it is
difficult to get loans for biogas projects.
More than 80% of all respondents think
that Latvian banks are prejudiced against
biogas projects.
The lack of trust is named as one of the
main problems of the Latvian financial
procedures. Another problem is the
excessive share of capital required by
banks. Biogas developers mention the
lack of state support and stable laws,
which leads to general instability in the
biogas sector as the main difficulties in
the development of biogas projects.13
13 Ekodoma Ltd. http://www.biogasin.org/files/pdf/
WP3/D.3.6.5_EKODOMA_LV.pdf
 3.7.9. Readiness for Uptake
The Latvian Biogas Association (LBA)
was founded in 1994. It is one of the
oldest NGOs operating in Latvia’s
energy sector. LBA is actively taking
part in the development of state policy
and regulations regarding the renewable
energy sector.
The Investment and Development
Agency of Latvia (LIAA) is a state
institution subordinate to the Ministry
of Economics of the Republic of Latvia.
LIAA offers assistance throughout the
process of setting up operations in Latvia,
acting as a first point of contact and as
a ‘one-stop-shop’ in assisting investors
and in developing tailored solutions
to meet their specific needs. LIAA has
its own regularly updated database of

Market Handbook Biogas

Latvian enterprises to facilitate partner
searches for investment projects and for
exporting or subcontracting businesses.
The Investment and Development
Agency of Latvia offers a matchmaking
service, enabling potential investors
and project partners to find suitable
Latvian companies interested in
Mergers & Acquisitions and joint venture
opportunities.14
Biogas is known and well-regarded by 129
the general public. During the last four
years only two biogas projects were
stopped due to public opposition.

14 The Investment and Development Agency of Lat-

via. http://www.liaa.gov.lv
 3.8. Finland

Bioenergy Association of Finland

(FINBIO)
Text: Mr. Pekka-Juhani Kuitto (Executive
Director, retired)
Contact: Mia Savolainen
Korkeakoskentie 17 D, 40500 Jyväskylä,
Finland
Tel.: +358 40 7182026
Email: mia.savolainen[at]finbio.fi

3.8.1. Country Score

Country Score Finland South - Biogas (November 2011)

In the general
scoring for Bio-
gas sector, Fin-
land - South is
rated place 34
out of total 81.
Market Handbook Biogas

The underlying
categories that
influence this
result are dis-
played in the
bar chart abo-
ve.

Country Score Finland South - Biomethane (November 2011)

In the general
scoring for Bio-
methane sector,
130 Finland - South
is rated place 45
out of total 81.
The underlying
categories that
influence this re-
sult are displayed
in the bar chart
above.
 3.8.2. Basic Data
Finland is a democratic republic in
Northern Europe between 60 and 70
degrees north latitude. It is the seventh
largest country in Europe with a total
territory area of 338,424 km² (of this
69% forest, 10% waterways, 8%
cultivated land and 13% other). The total
population is 5.4 million. The capital and
largest city is Helsinki (in capital area
1 million inhabitants). The population is
mostly concentrated in the southern and
central part of the country. About 80%
of the population lives in urban areas.
Finland is the coldest country in the EU.
Latitude is the principal influence on the
country´s climate. On average, winter
with snow lasts from mid December to
mid March in the south, and from October
to early May in the north. The vegetation
zone is mainly characterised by boreal
forest. The mean daily temperature
in the capital Helsinki is minus 4 °C in
January and plus 18 C°C in June. In
Northern Finland - also called ‘Lapland’
- temperatures may fall to minus 25-
35° C in mid winter. However, because
the Gulf Stream and the North Atlantic
Drift Current moderate the climate, and
because of the relatively low elevation
of the land area, Finland contains half
of the world’s arable land north of 60°
northern latitude.
Finland is world famous for its large
boreal forest and peatlands, and its global
forest industry that comes therewith.
Forestry land (incl. protected areas) is
228,000 km2, of which 52% is owned by
private families, 35% by the state, 8%
by companies and 5% by others. The
total volume of growing stock is 2,205
million m3 (solid), of which 50% is pine,
30% spruce and 20% non-coniferous.
The annual growth is over 100 million m3
(solid) and annual fellings for industry
purposes is 55 million m3 (solid). Total
drain is 71,5 million3 (solid). These
numbers are industrial round wood
contents, without branches, tree tops,
unmerchantable round wood and stump
and root wood, which adds volumes
around 20-40% more. Peatlands cover
about 30% of Finland´s territory. Peat is
growing more annually than it is used
for energy purposes, about 25 TWh per
year. Most often peat is mixed with wood
based fuels or coal at power or CHP
plants. It is good quality, indigenous and
low price fuel. Companies also import
Market Handbook Biogas
raw wood.
There are 2.3 million hectares arable
farm land in Finland. Wheat, barley and
oats are the most produced crops in
agriculture, but also potato and other
root vegetables are very common. About
0.5-0.7 million hectares can be used for
energy purposes.
The road- and railway network is quite
large (main roads 460,000 km, also
dense forest road network, railroad net 131
is 5,800 km). The maximum total weight
for trucks is 60 tonnes on public roads.
Also dense water transport systems and
routes on the seasides and lakes exist.
Finland´s economy provides reliable
frameworks for living and business.
Living standards are high. GDP per
capita is 38,000 € (2011). Finland is:
 • Number one in World Economic Forum
2005 Competitiveness Rankings.1
• One of the Least Corrupted Nations
in the World (number one in 2007 and
number two in 2011 / Transparency In-
ternational).
• The Best Country in 2010 by Newsweek
(indicators: education, healthiness, qua-
lity of life, economical dynamics and po-
litical frames).
• The second happiest nation 2012 by
United Nations´ Ranking (1. Denmark,
2. Finland, 3. Norway, 4. Netherlands, 5.
Canada etc.).
Usefull links:
• Finland Statistics
• Common information
• Energy Statistics
Market Handbook Biogas
• Bioenergy Statistics: www.finbioener-
gy.fi and www.bioenergia.fi
3.8.3. Energy Policy
Finland is one of the world’s leading users
of RS for energy generation, especially
bioenergy. RES provide one fourth of
Finland’s total energy consumption and
accounts for more than one fourth of its
132 power generation. The country’s most
important RES include bioenergy – wood
and wood-based fuels in particular –,
hydropower, wind power, ground heat,
and solar energy.
The objective of the national energy
and climate strategy is to increase the
use of RES and their share of energy
1 www.weforum.org
consumption. In addition to energy
conservation, this is one of the most
significant means by which Finland’s
climate targets can be reached. In use,
RES do not increase carbon dioxide
emissions, but they create employment,
promote regional policy goals, and
enhance the security of energy supply.
The strategy also supports technology
exports for the industry, which are
already becoming an important part of
Finnish exports.
Finland´s national target is to increase
the use of renewables by 9.5% units
to overall 38% in 2020. Bioenergy
has a major role. Achieving the 38%
target entails an increase in the use of
renewable energy of approximately 40
TWh compared to 2005, when renewable
energy use accounted for 28.5%. One
particular target within this national
action plan is for renewables to account
for at least 20% of transportation fuels
by 2020, taking into account the double
counting referred to in the RES Directive.
The total renewable energy target in
2020 is 124 TWh (85 TWh for heating and
cooling, 33 TWh for electricity and 6,5-
7 TWh in traffic) of which bioenergy is
105 TWh. Other targets are to decrease
the GHG emissions at least by 16% until
2020 and to increase energy efficiency
by 20% until 2020.
According to the Climate and Energy
Strategy, the use of biogas should be
increased to 0.7 TWh by 2020. In order
to promote CHP production using biogas
(reactor plants) a market-based new
feed-in tariff scheme was introduced,
which is financed by the State budget.
The feed-in tariff is equivalent to the
difference between the target price and
the market price of electricity. The tariff
will be paid only to new biogas power
plants. The target price for electricity
produced from biogas covered by the
feed-in tariff scheme is €83.50 per
MWh. In CHP production, in addition,
a heat premium of €50 per megawatt-
hour is paid for electricity produced from
biogas. The cost of the biogas electricity
support scheme is estimated at around
€2 million in 2011 and around €10 million
in 2020 if the market price for electricity
is €50 per MWh. Electricity generated
from biogas not covered by the feed-
in tariff scheme will continue to benefit
from a fixed subsidy of €4.20 per MWh.
Farm-size biogas technology investments
can also get the national subsidy funds.
Use of landfill gas will be promoted by
the energy subsidy.
3.8.4. Feedstocks
Biogas can be produced from organic
waste and agrobiomass in biogas plants.
In 2010, 0.463 TWh of energy, 0.315
TWh of heat, and 0.107 TWh of electricity
were produced from biogas. The biogas
market in Finland is quite small; however,
it is growing. Gas production potentials
are large and also several raw material
sources are not yet depleted.
Approximately 2.6 million tonnes of
municipal waste has been collected, of
which about 33% was biowaste that
could be utilized for biogas production.
The amount of municipality waste is 0.9-
1.3 TWh depending on the quality of the
waste. The food industry creates 430,000
tonnes of process waste per year that
could be utilized for biogas production.
In terms of energy, this corresponds to
0.4-0.6 TWh. Approximately 160,000
tonnes of slurry from wastewater
treatment plants is created each year,
which could be used to produce about
0.9 TWh of energy by utilizing biogas
technology. The biggest biogas potential
is in agriculture, where biogas can be
produced from animal manure, plant
production waste, side streams, and
from purpose-grown agrobiomass. A
total of 25 million tonnes of straw and
manure is produced, corresponding to
approximately 30-140 TWh of energy.
Altogether, the theoretical maximum
potential for biogas energy ranges
from 40-150 TWh (140-530 PJ) taking
Market Handbook Biogas
into consideration purpose-grown
agrobiomass. The techno-economic
biogas potential based on biogas raw
materials is estimated to be 7-18 TWh.
This estimate can be considered to be
quite a good potential for 2020.2
Biogas can be produced from organic
waste and agrobiomass in biogas plants.
In 2010, 0.463 TWh of energy, 0.315
TWh of heat, and 0.107 TWh of electricity
were produced from biogas. The biogas 133
market in Finland is quite small, however
it is growing. Gas production potentials
are large and also several raw material
sources are not yet depleted.
Approximately 2.6 million tonnes of
municipal waste has been collected, of
which about 33% was biowaste that
could be utilized for biogas production.
2 FINBIO Publication nro 46
 The amount of municipality waste is
0.9-1.3 TWh depending on the quality
of the waste. The food industry creates
430,000 tonnes of process waste
per year that could be utilized for
biogas production. In terms of energy,
this corresponds to 0.4-0.6 TWh.
Approximately 160,000 tonnes of slurry
from wastewater treatment plants is
created each year, which could be used
to produce about 0.9 TWh of energy by
utilizing biogas technology. The biggest
biogas potential lies in agriculture, where
biogas can be produced from animal
manure, plant production waste and
side streams, as well as from purpose-
grown agrobiomass. A total of 25 million
tonnes of straw and manure is produced,
corresponding to approximately 30-140
TWh of energy. Altogether the theoretical
Market Handbook Biogas
maximum potential for biogas energy
ranges from 40-150 TWh (140-530 PJ)
taking into consideration purpose-grown
agrobiomass. The techno-economic
biogas potential based on biogas raw
materials is estimated to be 7-18 TWh.
This estimate can be considered to be
quite a good potential for 2020.3
3.8.5. Business Case
134 Finland uses some of its biogas for
energy production; however, some is still
remains at landfills without being used.
The biogas potential is large, and so far
mainly unused for energy production. If
this potential was used to its maximum,
about 700,000 cars or 50,000 buses
in Finland could be powered by biogas
generated from waste materials.
3 FINBIO Publication nro 46
Currently, there are numerous plans in
all parts of Finland for investing in biogas
upgrading plants and filling stations by
2015. Most of them are outside of the
natural gas network that only covers a
part of Southern Finland. If all those plans
are realized, the total annual production
capacity of upgraded biogas would go up
to 500 GWh. The total techno-economic
biowaste resource is 7-18 TWh/a.
The most effective incentive for
innovation is a market where broad
diffusion of new solutions happens
quickly and open-mindedly. In addition
to promoting research and development
activities, innovation policy aims to boost
demand for innovations, and, thereby,
encourages companies to develop more
advanced products and services.
For biomethane and biogas availability,
prices of biomass, logistics and other
production costs play in important role
when competiting with fossil fuels prices.
In order to promote CHP production using
biogas (reactor plants) a market-based
feed-in-tariff scheme was introduced in
2011 financed on an annual level fom
the State budget. The feed-in tariff is
equivalent to the difference between
the target price and the market price
of electricity. The tariff is paid only to
new power plants. The target price for
electricity produced from biogas or
wood chips covered by the feed-in tariff
scheme would be €83.50 per MWh. With
regards to CHP production an additional
heat premium of €50 per megawatt-hour
is paid supplementing the feed-in tariff.
The cost of the biogas electricity support
scheme was estimated at around €2
million in 2011 and around €10 million in
2020 if the market price for electricity is
€50 per MWh. Electricity generated from
biogas that is not covered by the feed-
in tariff scheme will continue to benefit
from a fixed subsidy of €4.20 per MWh.
Wind and wood fuelled plants get €6.90
per MWh.
The Finnish Biogas Association and the
North Karelian Traffic Biogas Network
Development Programme have just
introduced the Roadmap to Renewable
Methane Economy target paper. A goal
of 40 % for renewable methane of
transport energy consumption in 2050 is
proposed in the report and roadmaps for
different forms of transport have been
planned. In order to get the development
into the desired tracks, targets for 2020
have also been proposed, and a toolbox
Figure ‚Fossil and Renewables‘: Fossil fuels and renewables 1970–2011,
PJ
Source: Statistics Finland, Energy supply and consumption, www.stat.fi
of recommended instruments has been
designed for State level interventions.
In road transport, the target is 2% of
vehicles in 2020, i.e. 60,000 vehicles.
Meeting the target means that methane-
driven vehicles reach a 4.4 % share of
registrations in the period from 2012 to
2020. Also a part of non-electrified rail
transport is expected to move from diesel
oil to methane by 2020. Water transport
will be leading the way, since already in
2013 two large vessels (300 GWh annual
methane consumption) will be taken into
use: Viking Grace (a large passenger
ship for the Turku-Stockholm route) and
UVL 10 (Finnish border patrol boat). Both
being currently under construction, they
will be using Finnish Wärtsilä dualfuel
methane-diesel engines. By 2020 at
least 20 vessels are expected to follow
Market Handbook Biogas
due to the UN/IMO sulfur emission
135
 restrictions in the Baltic Sea. In 2020
natural gas (NG) is expected to cover 60
% of transport methane use of 2.5 TWh.
Biogas (BG) and synthetic biogas (SBG)
would contribute 1 TWh (40 %). After
2020 the share of renewable methane
will continuously increase, and by 2050,
the use of natural gas and all other fossil
fuels will be phased out.
3.8.6. Market Environment
In 2010, 0,463 TWh of energy, 0,315
TWh of heat, and 0,107 TWh of electricity
were produced from biogas.4 It is still
under 1% of the total energy production
using renewables. According to Finland´s
Climate and Energy Strategy, the use of
biogas should be increased to 0.7 TWh
by 2020.
Market Handbook Biogas
The total energy consumption in Finland
was 1,386 PJ or 386 TWh in 2011.
Consumption of electricity amounted
to 84.4 TWh (16% of the electricity
consumed in the country was covered
with imported electricity). Already
today, nearly 30% of the total energy
consumption is produced by RES.
Bioenergy is the most significant source
of renewable energy, accounting for
approximately one-fifth of Finland´s total
136 energy consumption. Today, wood-based
energy is the most important RES and it
will continue to grow in the near future.
Wood energy usage today is almost as
large as oil. A total of 86 TWh of wood
energy was used in 2011 (liquid 37 TWh
and solid 49 TWh). 32 TWh of solid wood
fuels were used in energy plants (often
4 Finnish Gas Association
mixed with peat) and 17 TWh in small
houses. Today, carbon dioxide emissions
from the production and use of energy is
50 million tons (almost 70 million tons in
2002). In 2011, total energy consumption
came from the following sources: oil
24%, wood fuels 22%, nuclear energy
18%, coal 11%, natural gas 10%, peat
6%, net imports of electricity 4%, hydro
and wind power 3% and others 3% (see
Figure ’Fossil and Renwables’).
Finland is one of the world leaders in
the utilization of wood based energy,
the development of biomass combustion
technologies, and the creation of
efficient fuel supply chains from farm-
size up to the world´s biggest biomass
plant. The cold climate, long distances
and an energy intensive industry
explain why Finland has a relatively high
demand for energy. The specific energy
consumption per capita is high; industry
uses about half of the energy generated.
An efficient and balanced energy system
is crucial. Today, significant indigenous
energy sources are limited mainly to
wood fuels, peat and hydropower, but
the range will be widened with wind,
biogas, agricultural biomass, biofuels for
transport, and heat pumps. The use of
wood fuels is growing the most.
Currently, about 140 million m3 of biogas is
being produced in Finland. Altogether, 16
biogas reactor plants were in operation
at different municipal wastewater
treatment plants by the end of 2010.
Industrial wastewaters were treated
anaerobically at three different plants.
Farm-scale biogas plants operated at
10 facilities. Municipal solid wastes were
treated at six biogas plants. In 2010,
the amount of biogas produced by the
reactor installations was 37.5 million m³
and the combustion of surplus biogas 4.8
million m³. The production of thermal,
electrical and mechanical energy was
179.0 GWh. As compared to the previous
year, there was a fair increase in the
total amount of the produced biogas and
the energy generated. Altogether there
were 39 landfill gas recovery plants
in operation. The amount of biogas
recovered was 101.6 million m³. The
amount of recovered biogas used for
the production of electrical and thermal
energy was 58.7 million m³, producing
242.4 GWh.5
Finland imports natural gas from Russia.
40 TWh of natural gas is consumed by
the company Gasum Ltd. The company
also owns the natural gas pipeline
network and it covers the southern part
of Finland, a total of 1.310 km of high-
pressure gas transmission pipelines and
540 km of lower-pressure ones. The
small amount of ‘made in Finland’ biogas
is fed into the Gasum gas network, too.
In the transport sector, the role of
biogas is expected to increase in the
near future. Before 2002, Finland did not
have modern biogas cars. This changed
when Mr. Erkki Kalmari (Metener Ltd) in
Central Finland bought the first ones and
started the farm-size biogas production
and technology development in his
farm: biogas for heat and electricity and
traffic purposes. Biogas is produced by
co-digesting manure from 40 cows with
5 University of Eastern Finland, www.uef.fi and Fin-
nish Biogas Association, www.biokaasuyhdistys.net
plant waste, kitchen waste, industrial
waste from a nearby candy factory and
energy crops. Today, there are around
800 biogas vehicles and 15 feeding
stations in Finland. The use of biogas
for traffic purposes is 7.20 TJ or 2000
MWh. So, until today biomethane is not
very common in the transport sector. If
used as transport fuel, biomethane has
to meet the sustainability requirements.
Finland´s strategy for transport biogas
aims at a 10% share of biomethane
in traffic fuels in 2020. The strategy’s
primary act is to keep biomethane and
biogas vehicles exempt from. However,
in 2011 the Parliament permitted the
new fuel taxation and taxes for vehicles
using other fuels than gasoline, including
biogas vehicles. Biomethane as a fuel is
still free from fuel taxation.
Market Handbook Biogas
Usefull links:
• Bioenergia
• Finnish Biogas Association
• Benet Ltd
• Gasum Ltd
• Metener Ltd
• Finland Statistics
• Energy statistics 137
• Common information about Finland
• Energy Statistics
 3.8.7. Regulation
In Finland, there is a feed-in tariff for
renewable energy. The Act on Production
Subsidy for Electricity Produced from
RES (1396/2010) lays down provisions
for a feed-in tariff system for which
wind, biogas, forest chips and wood-
based power plants.
In the feed-in tariff system, an electricity
producer whose power plant is approved
will receive a subsidy (feed-in tariff)
for a maximum of twelve years. The
subsidy varies on the basis of a three-
month electricity market price and the
market price of emission allowances.
The producer is paid a feed-in tariff,
which is the difference between the
target price and the spot market price
(last 3 months’ average). For electricity
Market Handbook Biogas
produced in a power plant using wood-
based fuel or a biogas power plant, an
increased feed-in tariff is paid in the form
of a standard heat premium if also heat
is produced if the overall efficiency of
the plant meets the required standards.
The purpose of the subsidy at hand is
to promote investments in wind, biogas,
and wood-based power plants, and it is
dimensioned to have the total amount of
subsidies paid to the power plant for the
138 feed-in tariff periods to compensate for
investment costs.
The feed-in tariff paid for electricity
produced in a forest chip fuelled power
plant included in the feed-in tariff system
is designed to retain the competitiveness
of the use of forest chips as fuel in the
cogeneration of power and heat. The
purpose of this subsidy is to promote the
replacement of peat with forest chips. In
order to promote CHP production using
biogas (reactor plants) a market-based
feed-in-tariff scheme will be annually
financed from the State budget.
The feed-in tariff is paid only to new power
plants. A power plant benefiting from
the feed-in tariff would not be eligible for
any other State aid like the construction
investment costs of renewable energy
plants, which are co-financed by the
government with grants of up to 40%.
For the plants using BAU technologies,
the co-financing can be up to 30%. This
financing applies to companies.6
The Energy Market Authority approves
power plants for the feed-in tariff system,
pays the feed-in tariff upon application,
and manages other official tasks in the
feed-in tariff system.
The use of transport biofuels is to be
increased to 7 TWh by 2020. Promotion of
the use of biofuels will be primarily based
on a distribution obligation incumbent
on vendors of transport fuels. The aim is
to set the biofuel distribution obligation
as high as 20% by 2020, taking into
account the double counting referred to
in the RES Directive.7
Finland´s strategy for transport biogas
aims to reach a 10% share of biomethane
in traffic fuels in 2020. The strategy’s
primary act is to keep biomethane free
from fuel taxation and biogas vehicles
free from taxation for vehicles that use
other fuels than gasoline. However, in
6 http://www.finlex.fi/fi/laki/alkup/2007/20071313
7 Finland’s National Action Plan for promoting Ener-
gy from Renewable Sources pursuant to Directive
2009/28/EC
2011 the Parliament permitted the new
fuel taxation and taxes for vehicles using
other fuels than gasoline, including biogas
vehicles. For instance new taxation for
methane using passenger cars is 3.1
cents / day for each incipient 100 kg of
vehicles mass. Biomethane as a fuel has
remained free from fuel taxation.8
Transport-related emissions will be
reduced, for instance, by supporting
public transport, renewing the vehicle
fleet and favouring low-emission
vehicle technology. Vehicle taxation
has been reformed, paying due respect
to low emissions in accordance with
the concept of technology neutrality.
The use of biogas in vehicles will be
promoted. Attention will be paid to the
development of vehicle technology and
biofuels and their emissions impacts over
their full life-cycle. Various budgeting
and financing models for transport
investments are evaluated. The project
evaluation of such investments will be
renewed in such a manner that their
economic, employment, emissions, and
regional policy impacts will be taken into
consideration
8 http://www.liikennebiokaasu.fi/index.
php?option=com_content&view=category&layout=bl
og&id=14&Itemid=13
3.8.8. Project Financing
Finland is a member of the Eurozone;
hence, currency exchange risks for
investors from other Eurozone countries
are low. Finland´s economy is rated with
one of the best scores at Standard &
Poor´s and Moody´s.9 In addition, Finland
was number one in World Economic
Forum 2005 Competitiveness Rankings10
and one of the Least Corrupted Nations
in the World: number one in 2007 and
number two in 2011.11 Finland´s credit
rating is AAA.
There are plenty of international and
national banks situated in Finland.
Loan interest levels are rather low but
variable. The easiness of getting a credit
from banks is very much dependent on
individual projects. Common VAT is 23%
Market Handbook Biogas
but companies have possibilities to be
rebated.
In the EU, the competition rules are
generally divided into two parts:
regulations applying to the use of
public support (government support)
and regulations related to the conduct
of businesses. Investments between
the OECD member countries are
regulated by the organisation’s so-called
National Treatment Instrument, Code 139
of Liberalisation of Current Invisible
Operations and Code of Liberalisation of
Capital Movements, and the Guidelines
for Multinational Enterprises, of
which the latter still only comprises
recommendations. The Ministry for
9 www.standardandpoors.com/home/en/eu and
www.moodys.com
10 www.weforum.org
11 http://cpi.transparency.org/cpi2011/results/
 Foreign Affairs of Finland12 provides
knowledge and information about trade
and partnership possibilities for national
and international business cases. By
international comparison concerning
the number of investment agreements,
Finland ranks among the middle group
together with Sweden, Denmark, Austria
and Belgium. At the moment, the number
of valid agreements is somewhat over 50.
Germany, Great Britain and Switzerland
have the most comprehensive networks
of agreements, each with well over one
hundred agreements.
The partnership with Finnish companies
is also worth while. Finpro13 trade
supporting organization has 400
professionals in almost 50 countries. It
opens up future business opportunities by
understanding changes in international
Market Handbook Biogas
markets. It serves clients by enabling
them to be in the right markets at the
right time with a competitive concept.
The specific energy project financing
institution is the Ministry of Employment
and the Economy.14 It offers different
kinds of support in financing, investing
and developing projects of renewable
energy projects in Finland. The maximum
energy subsidy per cents granted by
140 the Ministry of Employment and the
Economy are 40% when investments
are targeted at new technologies or
energy saving appliances at plants using
renewables. The subsidiy is at 30%
when investments flow into ordinary
technologies or technologies
12 www.formin.finland.fi
13 www.finpro.fi
14 www.tem.fi
that decrease environmental damages.
Typical public energy grants range from
10-15% for heating plants, from 15-20%
for landfill gas plant, and from 10-20%
for wood chips or industrial waste wood
production machineries etc.
Usefull links:
• Ministry for Foreign Affairs of Finland
• Ministry of Employment and the Eco-
nomy
• Finpro
• Bioenergia Association with its mem-
bers
3.8.9. Readiness for Uptake
Biogas is currently being produced in
about forty reactor plants (37.5 million
m³) and in 39 landfill gas recovery plants
(101.6 million m³). rowth has been quite
slow up to today, but the new feed-in
tariff schemes and energy subsidies for
biogas will increase the production and
use of biogas for heat and electricity.
Biogas is also fed into the natural gas
pipeline network. Thus, technology
markets are open for expanding gross
border bioenergy businesses.
There are numerous plans in all parts
of Finland for investmetns into biogas
upgrading plants and filling stations by
2015. Most of them are outside of the
natural gas network that only covers the
southern part of Finland. If all those plans
will become a reality, the total annual
production capacity of upgraded biogas
would go up to 500 GWh. However, the
total biowaste resource is 14 TWh/year.
In addition, there is a plan to build a
large synthetic biogas (SBG) production
plant at a pulp mill, based on waste wood
use. Its annual production capacity of
upgraded biomethane would be up to
1600 GWh. It has estimated that there
would be a potential for 9 other plants of
similar size.15
Usefull links:
Associations:
• Finnish Biogas Association
• Finnish Gas Association
• Bioenergia
Institutions:
• Ministry of Employment and the Eco-
nomy
• Ministry of Agriculture and Forestry

Market Handbook Biogas

• VTT Technical Research Centre of Fin-
land
Companies:
• Gasum Oy
• Benet Oy
• Bionova Oy
• Bioste Oy
• Metener Oy
141
• Sarlin Oy

15 Finnish Biogas Association

 4. Annex

1. Country profile (geography, demographics, logistics, etc.)

1.1 Geography and Climate
• Total land area
• What is the average summer temperature across regions in target country over
the last 10 years?

1.2 Population
• Total number of inhabitants
• Total number of households in the country
• Population density
• Household density
• Total number of personal transport vehicles

1.3 Wealth/economic status of population

• What was the average GDP real growth rate between 2008 - 2010?
Market Handbook Biogas

• GDP per capita for 2010

1.4 Logistics - road and rail network

• What is the density of road-network? (for goods/biomass transportation)
• What is the density of the electricity transmission and distribution networks?
• What is the density of the gas transmission and distribution networks?

2. Energy Policy (political will, nREAP, etc.)

142 2.1 The nREAP is ambitious and proposes appropriate measures
• There are high-volume targets for RES (Difference in ktoe 2010 - 2020)
• There are high-volume targets for biogas (Difference in ktoe 2010 - 2020)
• There are high-volume targets for electricity from CHP (Difference in ktoe 2010
- 2020)
• Proposed measures for bio-methane and biogas in nREAP are appropriate and
convincing
• Proposed measures for biogas CHP in nREAP are appropriate and convincing
2.2 A political will to develop the RES-sector is clearly recognisable and stable
• Does the government provide an appropriate budget for the targeted market
growth for biogas, biomethane?
• Have the support schemes/framework conditions for investments in biomethane
changed within the last 2-4 years?
• Is a revision of the framework conditions announced, which could affect bio metha-
ne market development?
• Is a revision of the framework conditions announced, which could affect the elec-
tricity market development?
• What is the period of time before the next general (national) elections.

3. Feedstocks

3.1 The biomass potential is sufficient to enable biogas CHP projects
• How many cattle-equivalent units are in the region? (to identify potential based
on feedstock)
• How large is the (municipal + commercial) bio-waste potential in the region?

Market Handbook Biogas

• What is the amount of biogas already produced in the region?

3.2 The biomass potential is sufficient to enable biomethane projects

• How many cattle-equivalent units are in the region?
• How large is the (municipal + commercial) bio-waste potential in the region?
• What is the amount of already produced bio-methane in the region (to identify the
remaining technical potential)?

3.3 The agricultural structure is beneficial for biogas and/or biofuel projects
• How many farms have at least 150 cattle in stables, which could enable small bio-
gas CHP projects? 143
• How many farms have at least 500 cattle in stables, which could enable larger bio-
gas CHP projects?
• How many farms have at least 125 ha crop land, which could enable larger biogas
CHP projects?
• What is the available farmland per inhabitant?
 3.4 Feedstocks are available for biofuel production
• Amount of domestic demand for cereal for biofuels in 2010
• Did the cereal production of 2010 exceed the domestic demand?
• Did the oil seed production of 2010 exceed the domestic demand?
• Area of fallow/abandonned land available for agricultural expansion

4. Economic instruments (prices, support schemes/guarantee, subsidies, etc.)

4.1 Financial support schemes can be claimed for investments
• What portion of the investment in biogas plants can be claimed in subsidies (cu-
mulative, including tax advantages)?
• When does the scheme end granting funding for biogas plants?
• Subsidies for investments in logistic/Infrastructure for high blend / pure bio fuels
are in place
• Investment subsidies for green vehicles procurements are in place

4.2 Financial support schemes can be claimed for operation

Market Handbook Biogas

• 150 kW biogas plants: How high is the legally guaranteed price for electricity (eit-
her feed in system, green certificate or other) in 2010?
• 500 kW biogas plants: How high is the legally guaranteed price for electricity (eit-
her through feed in system, green certificate or other) in 2010?
• >500 kW biogas plants: How high is the legally guaranteed price for electricity
(either through feed in system, green certificate or other) in 2010?
• How long is the guaranteed duration of the biogas support scheme?
• Is the support scheme limited by a maximum public spending budget?
• Is there a financial incentive to support the operation of biomethane or gas ve-
144 hicles?

4.3 Prices of fossil fuels are high and heavily taxed

• What is the price per kWh of gas for households?
• What is the price per kWh of gas for large scale consumers (average over the last
year)?
• What is the commodity price development of natural gas over the last 4 years?
• What is the tax on gas (CO2, energy, excluding VAT or ‘normal’ taxes)?
• Is the use of fossil gas supported e.g. by tax incentinves, obligations, free delivery
of CO2-allowances etc.?
• What is the price development of electricity of the last 4 years?
• What is the average end customers price for gas for transport over the last year
(2010)?

5.Market aspects (volume, access to grid, etc.)

5.1 The energy sector is large and expected to grow
• Amount of gas used in medium and large scale consumers (2010)?
• Expected growth in large and medium-scale use of gas from 2009 to 2020
• Amount of gas used by small scale consumers (2010)?
• Amount of total national electricity consumption
• Expected growth in national electricity consumption from 2009 to 2020
• What is the average age of the stock of power plants (coal, natural gas, nuclear)
• What is the share of natural gas in the electricity sector?

Market Handbook Biogas

• Has the region decided to phase out nuclear energy (providing potential for RES)?

5.2 Access to the electricity grid is guaranteed

• Is there in general an electricity grid available with sufficient capacity?
• Is there in general an electricity grid available with regulated grid access?
• Is there in general an electricity grid available with regulated costs for grid con-
nection?
• Is there in general an electricity grid available with priority for RES?
• Is the grid operator obliged to connect all renewable energy installations?
145
5.3 The heat market offers good opportunities
• What is the total amount of energy consumed by the small heating sector?
• What is the proportion of customers connected to a district heating grid?
• What is the amount of coal in the district heating sector?
• What is the average age of the stock of domestic heating appliances
• Is the connection of a biomethane plant to a natural gas grid regulated?
• Are the costs for grid connection regulated?
 • Is there a natural gas grid for biomethane feeding available with priority for bio-
methane?

5.4 Produced energy can freely be marketed

• Is the electricity market liberalised and private firms are free to participate in any
part of the supply chain?
• Is the heat market liberalised and private firms are free to participate in any part
of the supply chain?
• Is the gas market liberalised and private firms are free to participate in any part
of the supply chain?

5.5 The electricity market in the target country provides promising growth
perspectives
• What is the rate of additional electricity demand until 2020 (overall, not only RES)?
(2020-2009)/2009)
• What is the growth rate of electricity from biogas over the last 4 years?
• What is the cumulative amount of electricity produced from biogas in the last
available year?
Market Handbook Biogas

5.6 The heat market in the target country provides promising growth
perspectives
• What is the rate of the additional heat demand until 2020 (overall, not only RES)?
• What is the growth rate of biogas in the heat market over the last 4 years?
• What is the cumulative amount of heat produced by biogas in the last available
year?

5.7 The gas market enables the use of biomethane

• What is the rate of the additional gas demand until 2020 (overall, not biomethane
146 only)
• What is the additional gas demand until 2020 in absolute terms?
• What is the cumulative amount of biomethane consumed in the last available year
compared with biomethane target?
• What is the growth rate of biomethane in the gas market of the last 4 years
(CAGR)?
• What is the growth rate of biomethane in the transport sector of the last 4 years
(CAGR)?
• What is the total amount of biomethane used as vehicle fuel?
• Amount of all gaseous fuels used in transport

5.8 The Framework conditions for fossil fuels do not impair market development
• What is the contribution of imported natural gas on the primary energy supply in
real terms?
• What is the percentage contribution of imported natural gas on the primary energy
supply?
• What is the contribution of imported oil to primary energy supply in real terms?
• What is the percentage contribution of imported oil to primary energy supply?
• What is the contribution of imported coal to primary energy supply in real
terms?
• What is the percentage contribution of imported coal to primary energy
supply?

5.9 Bioenergy is already implemented with a strong growth

• What is the total biogas production quantity irrespective of final use

Market Handbook Biogas

• What is the biogas production growth rate in the last 4 years (CAGR)

5.10 An intense competition is not recognisable

• Number of competitors providing (manufacture or sale) turn-key biogas plants
• Total amount of biogas/biomethane plant capacity sold (by existing com-
petitors) over the last 4 years

6.Regulations (laws/mandatory targets for bioenergy, permitting, emission thresholds,

etc.)
6.1 Regulatory instruments to support bioenergy markets have successfully been 147
introduced
• How large is the quota for RES electricity in absolute terms?
• How large is the quota for RES heat in absolute terms?

6.2 The approval procedure by the authorities is adequate in terms of time

• How long does the approval process last in average for a biogas plant < 500 kWel
installed capacity?
• How long does the appoval process last in average for a biogas plant > 500
 kWel installed capacity?

6.3 Specific regulations are favourable for bioenergy market developments

• Is there a hygiene regulation for the treatment of bio wastes, which could incite
its utilisation in biogas plants?

6.4 Are criteria for efficiency required?

• Is there an obligation for CHP-operation of a biogas plant, if so, what is the requi-
red heat percentage?

6.5 Existing emission thresholds can be fulfilled with the applied technology
• Are there limits to emissions to air from biogas plants and, if so, how severe are
they?
• Are there limits for noise emissions from biogas plants and, if so, how severe are
they?
• Are there any regulations to mitigate odour emissions fropm biogas plants?

7. Project financing context (economic situation, loan, banks, etc.)

Market Handbook Biogas

7.1 The country has a solid financial position

• Standard and poors rating

7.2 Export friendliness

• Euler Hermes rating
• Corruption perception index
• Country risk as reflected by the @rating country of COFACE
• Ranking of feasibility of “starting a business” in the IFC-World Bank Doing Busi-
ness Index
148
• Ranking of Feasibility of “getting credit” in the IFC-World Bank Doing Business
Index
7.3 The banks are familiar with bioenergy technology and support its development
• Is the support of bioenergy projects highlighted in official papers of the banks,
like annual reports etc.?
• Are Governmental guarantees for loans for bioenergy investements in place?
7.4 Foreign investments are supported in the target country
• Are there any programmes implemented in the region to attract foreign invest-
ments?

7.5 The banks in the target country provide attractive conditions for bioenergy
projects
• Can bioenergy plants benefit from interest rates for credits lower than usual in
the market?
• Are the support conditions feasible in an adequate scope?

7.6 The market is liquid and transparent

• Biomethane prices are published on market place
• Financial market instruments (e.g. hedging, futures) are available to mitigate the
bio-methane price risk

Market Handbook Biogas

149
 Participating companies of the biogas working group

agri.capital GmbH
Michael Hauck, Head of Corporate Communication
Hafenweg 15, 48155 Münster, Germany
Phone: +49 (0) 251/27601 -100
www.agri-capital.de
BDI BioEnergy International AG
Dl Martin Krenn
Parkring 18, 8074 Grambach, Graz Austria
Phone: +43 (0) 316/4009100
www.bdi-bioenergy.com

Benet Ltd
Dan Asplund, Asko Ojaniemi
Piippukatu 11, 40100 Jyväskyla, Finland
Phone: +35 (0) 8400/640460
Market Handbook Biogas

www.benet.fi
biogas weser-ems GmbH & Co. KG
René Püschel, Sales
Zeppelinring 12-16, DE-26169 Friesoythe, Germany
Phone: +49 4491/938 006 44
www.biogas-weser-ems.de
CNG Services Ltd
John Baldwin, Managing Director
Rowanleigh, 37 St Bernards Road, United Kingdom
Phone: +44 (0) 121 707 8581
www.cngservices.co.uk
150
COWI AB
Karin van der Salm, Business Development Manager
Bioenergy
Skärsgaardsgatan 1 SE-402 41 Gothenburg, Sweden
Phone: +46 10/8501000
www.cowi.se
CTS Engtec Oy
Kirsi Juura, Manager, Marketing and Corporate Communications
Kaikukatu 7, FI-45101 Kouvola, Finland
Phone: +358 (0) 207/567 268
www.ctse.fi

Dalkia GmbH
Daniel Hölder
Hammerbrookstr. 69, 20097 Hamburg, Germany
Phone: +49 (0) 40/253038-0
www.dalkia.de

Gasum Oy
Pasi Torri
P.O. Box 21, 0215 Espo, Finland
Phone: +258 (0) 20/4471

Market Handbook Biogas

www.gasum.fi
German Biogas Association
Sebastian Stolpp, International Markets
Angerbrunnenstr. 12, 85356 Freising, Germany
Phone: +49 (0) 8161/984660
www.biogas.org
juwi R&D GmbH
Jan Schröter, Research Analyst
Energie-Allee 1, 55286 Wörrstadt, Germany
Phone: +49 (0) 6732/96571058 151
www.juwi.de

MalmbergGruppen AB
Erik Malmberg, Export Director Biogas
Malmberger Water AB 29685, Aarhus, Sweden
Phone: +46 (0) 44/7801853
www.malmberg.se
 MWM GmbH
Danieö Tislaric, Head of Business Development
Carl-Benz-Straße 1, 68167 Mannheim, Germany
Phone: +49 (0) 621/3848673
www.mwm.net

Planet Biogastechnik GmbH

Hanna Garbert
Up de Hacke 26, 48691 Vreden, Germany
Phone: +49 (0) 2564/3950-128
www.planet-biogas.com
Pro2 Anlagentechnik GmbH
Stephan Waerdt, Managing Director
Schmelzerstraße 25, 47877 Willich, Germany
Phone: +49 (0) 2154/488-0
Market Handbook Biogas

www.pro2.com

Schmack Biogas GmbH

Markus Staudt
Bayernwerk 8, 92421 Schwandorf, Germany
Phone: +49 (0) 9431/751-210
www.schmack-biogas.com

WELtec BioPower
Hajo Schierhold, Heas of Sales
Zum Langenberg 2, 49377 Vechta, Germany
152 Phone: +49 (0) 4441/99978-0
www.weltec-biopower.de
153
Market handbook
Sector Handbook CHP
Biogas

153
Impressum

Publisher: AEBIOM
Author: AEBIOM
Editor: eclareon Consultants

First Edition September 2012

Acknowledgements:
Special thanks are expressed to all industry stakeholders of the biogas working group
for their contributions and their part in the discussions during the elaboration of the list
of criteria and indicators.

Photos: ABA, GDF Suez, Direct Industry, Vattenfal, Flickr.

www.CrossBorderBioenergy.eu
Project Coordinator
European Biomass Association (AEBIOM)
Mr. Jean-Marc Jossart
Email: jossart@aebiom.org
Phone: +32 (0) 24 00 10 61
Website: www.aebiom.org

Project Partners
Austrian Biomass Association (ABA)
Mr. Christoph Rosenberger
Email: rosenberger@biomasseverband.at
Phone: +43 (0) 1533 07 97/25
Website: www.biomasseverband.at

Danish Bioenergy Association (DI Bioenergi)

Mrs. Kristine van het Erve Grunnet
Email: keg@di.dk
Phone: +45 (0)33 77 33 69
Website: www.energi.di.dk

Bioenergy Association of Finland (FINBIO)

Mrs. Mia Savolainen
Email: mia.savolainen@finbio.fi
Phone: +358 40 7182026
Website: www.finbioenergy.fi

German BioEnergy Association (BBE)

Mr. Thomas Siegmund
Email: siegmund@bioenergie.de
Phone: +49 (0) 228 81 00 223
Website: www.bioenergie.de

Hungarian Biomass Competence Center

(HBCC)
Mr. Imre Németh; Email: obekk[at]invitel.hu
Phone: + 36 (0) 28 420-291
Website: www.bioenergia-obekk.hu

Italian Agroforestry Energy Association

(AIEL)
Mrs. Annalisa Paniz; Email: paniz.aiel@cia.it
Phone: +39 (0) 49 88 30 722
Website: www.aiel.cia.it

Latvian Bioenergy Association (LATBIONRG)

Mr. Didzis Palejs
Email: didzis.palejs@latbionrg.lv
Phone: +371 (0) 675 22 399
Website: www.latbionrg.lv

Slovak Bioenergy Association (SKBIOM)

Mr. Josef Viglasky
Email: viglasky@vsld.tuzvo.sk
Phone: +421 (0)45 5206 875
Website: www.skbiom.sk

Swedish Bioenergy Association (SVEBIO)

Mrs. Lena Dahlman
Email: lena.dahlman@svebio.se
Phone: +46 (0) 8 441 70 83
Website: www.aebiom.org

Consulting Partners
eclareon Consultants
Mr. Christian Grundner
Email: cg@eclareon.com
Phone: +49 (0)30 246 286 93
Website: www.aebiom.org

Imperial College for Science, Medicine and

Technology (ICEPT)
Mr. Arturo Castillo-Castillo; Email: a.castillo@imperial.ac.uk,
Phone: +44 (0)20 7594 7312
Website: www3.imperial.ac.uk