EWB Insight: May 2016

This month: Covanta returns to the UK, US imports of biomass up again and could we reach waste processing capacity by 2030?

To read the report as a PDF click here

Covanta returns to the UK

US-based energy-from-waste business Covanta has returned to the UK market this month with involvement in two high-profile waste-fired schemes.

Having largely quit Europe in 2013 to refocus on its native North American market, the company, in partnership with Veolia, re-launched plans for its 50MWe Rookery South EfW (pictured below) plant this month.

The company is also involved with Peel Environmental’s Protos EfW build in Ince, Cheshire. Planning consent is expected to be applied for "later this year." Covanta’s involvement was revealed in a press release about the 35MWe facility.

However, its website thisisprotos.com, makes no mention of Covanta’s involvement and the company has declined to comment further on its involvement with Peel.

According to Eunomia principal consultant, Peter Jones, the company’s return is more to do with the needs of the businesses it has partnered with, then a shift in investment conditions.

Jones said: "Nothing has dramatically changed market wise. There is perhaps an incentive not to be the last one left with planning permission, but this does not seem a cynical move."

According to Jones, Covanta has instead opted to "haggle out" a deal with Veolia, which is looking for additional EfW capacity having had its planning application for the New Barnfield EfW build, less than an hour’s drive away from Rookery South, quashed by the government last year.

Jones added: "Investing in EfW without securing a large waste stream is looking like a less sure bet and getting investor backing, with the possible exception of the GIB (Green Investment Bank) appears to be more difficult than ever."  However, he concluded: "No one is getting paid if it doesn’t get built."

Covanta is currently developing numerous EfW and biomass-fired  facilities in the US and Canada, but having gone all out to expand into Europe from 2005-onwards it struggled to wins contracts and get facilities through the planning process.

Alongside Rookery South and Protos, the company is developing the 600,000 tonnes a year 58MWe capacity Poolbeg EfW plant, in Ireland. It also owns a small percentage of an Italian EfW plant.

The company was contacted for a comment.

Data watch

Consultancy Eunomia said this month the 104.2 million tonnes per year of treatment capacity across Northern Europe will exceed the 90.4 million tonnes of residual waste expected to be produced in 2030. The full report is available at eunomia.co.uk

Policy Insight

Biomass could play a key role in the EU’s heating and cooling strategy, according to a draft report by the European Parliament’s environment committee. A "European gas crisis would be a heat crisis" due to the current reliance on natural gas for heating, it said. Biomass could be "a cost-efficient means of decarbonising the energy sector while also contributing to security of supply objectives", according to the report.

The Danish government will back a 2.5% blending mandate for 2G bioethanol as an additive to petrol, according to the Maabjerg Energy Center (MEC), which needs policy support to complete a planned straw-to-biofuel manufacturing facility. The DKK2bn (€294m) facility will produce 2G bioethanol, biogas and heat using technology developed by DONG Energy and Novozymes.

In a related move, Danish energy and petroleum trade association EOF said its members would begin blending straw-derived 2G bioethanol with petrol at the start of 2019, one year earlier than the government had proposed. The 2.5% blending mandate was "imperative", according to the association.

Flemish deputy prime minister, Annemie Turtelboom, stepped down over a row involving financial support for a biomass-fired electricity plant. Turtelboom, who also held responsibility for energy in Flanders, said the decision to back the plant was not directly hers, but she had become associated with a potential "mountain of debt". Belgian Eco Energy’s (BEE) is developing the 215MWe facility, but will need about €100m a year in support to make the project viable. A decision on subsidies is due later this year.

Also in Flanders, a government U-turn on subsidising heat generated from waste incineration allowed Bionerga to bring back plans for a 200,000 tonnes-per-year EfW plant. On the back burner since 2014, the facility could be developed in Beringen in partnership with chemical company Borealis, which would use process steam from the plant.

The same Flemish policy change also allowed ISVAG is to press ahead with plans to build a small-scale district heating network supplied by its Wilrijk EfW plant (pictured below). About 80 companies on the Terbekehof industrial estate, near the city of Antwerp, would receive heat next year due to the €3m project, which will receive about €276,672 in support from the government.

Industry and NGOs were split over the best way to proceed with biofuel policy as a European Commission consultation on EU 2020-2030 sustainable bioenergy criteria closed in early May. Responses to the consultation showed a divide on whether greenhouse gas emissions from indirect land-use change (ILUC) caused by biofuels should be something EU legislation tackles.

The first of two SDE+ subsidy rounds held this year in the Netherland’s was massively oversubscribed with 3,354 projects worth €8.2bn vying for €4bn in support. In total more than half of the projects involved biomass.

German trade associations including Fachverband Biogas (FvB) spent much of May fighting against the proposed 2017 renewable energy act (EEG) draft. The groups launched the Energiewende Retten campaign, or save our energy revolution. The month of action is due to culminate in a rally in Berlin, possibly on 2 June.

Market Insight

Fortum is looking to expand its EfW reach after making an offer to buy fellow Finnish-owned business Ekokem. Ekokem is involved in turning waste into energy and products and is owned by four main shareholders, including the Finnish state, which is now deciding on the "indicative and non-binding" sale proposal.

Danish biogas business MEC revealed its second consecutive year of operating profit with a positive result of DKK 1m (€134,000) for 2015. Chairman, Nils Ulrik Nielsen, said "the launch phase is over" for the vast facility that processes about 800,000 tonnes of manure a year.

UK-based Interserve revealed a £70m (€89m) hole in its accounts caused by delayed development of its Glasgow EfW plant. Extra work is needed to bring the waste gasification build back on track, with delays relating to the technology blamed for the hold up. The company’s net debt is expected to be around £35m (€44m) higher than expected, when it releases first half-year financial results later this year.

In a related move anti-biomass body UK-based Biofuelwatch is urging people to object to a waste wood gasification facility. The 84,000 tonnes per year plant would use "risky unproven technology" it said. Developer Sibor hopes to build its plant on in Andover.

The Port of Tyne in northern England announced plans to build facilities to process and store up to 1.8 million tonnes of wood pellets a year. The port will invest £13m in the project, with Lynemouth Power Limited (LPL) putting in a larger unspecified amount. LPL is owned by Czech utility Energetický a Prumyslový Holding (EPH). It is converting from coal-to-biomass the Lynemouth power station, which will have a capacity of 420MWe when the work is completed in about a year.

German business Agraferm Technologies launched legal action for compensation against biogas business KTG group and its subsidiaries. According to a statement a hearing is due at the district court of Hamburg. The hearing only relates to determination of liability for damages, as previous legal action last year settled much of the claim, but without an admission of liability.

Czech-based construction firm CKD Praha DIZ is in financial difficulties. The business has mostly delivered Plzenská Teplárenská’s Chotíkove EfW facility (pictured below), but has been taken off the final part of the build with Plzenská Teplárenská paying its subcontractors directly to ensure the work was finished. The facility also took it first waste delivery this month as it prepares to complete commissioning.

Abengoa Netherlands declared bankruptcy, leaving its 127 million gallons per year bioethanol facility in Rotterdam standing idle. Adminstrators Borsboom & Hamm have taken over day-to-day running of the company, which officially trades as Abengoa BioEnergy Netherlands BV. The plant could be restarted in a matter of weeks should a buyer come forward, according to the administrator.

However, rival German bioethanol producer CropEnergies revealed its EBITDA reached €122m in the year to February 2016, a huge rise on the €25m reported in th previous year. As a result the company will reopen its Wilton, UK, bioethanol production facility. The plant was closed in February 2015, but will now restart by July "at the latest" on an initial trial basis.

BioEnergy International (BDI) is struggling to gain market traction in France and Turkey, it emerged. The German biogas and biodiesel business said initial Turkish enthusiasm for bioenergy had "evaporated almost entirely". It gave no details regarding its performance in France. The business will close sales offices in both countries and centralise operations back to Germany "to reduce costs".

UK-based Cogenpower sold Italian firm Esseti Energia back to its original owner Cavanna Legno after discovering undisclosed issues with the company’s small-scale biomass plant. Esseti is the owner and operator of the biomass power plant in Predosa, Italy. It was returned for an immediate price of €30,000 and the repayment of a loan of €104,655.

Figures from the North American Wood Fiber Review showed a record high for European biomass imports last year. US exporters shipped a total of 6.1 million tonnes, all going to Europe, principally to the UK, and especially the Drax power station. Canada-based pellet manufacturers supplied both Europe and Asia.

Facilities Insight

Fortum Värme formally opened one of the largest purpose-built biomass-fired power stations in the world this month in Sweden. The company’s woodchip-fired Värtan cogeneration facility has capacities of 280MWth and 130MWe.

Lietuvos Energija and Fortum Heat Lietuva have tendered for a main contractor for their €140m EfW plant joint venture in Kaunas, Lithuania. The planned facility will process up to 200,000 tonnes per year of municipal waste. It will have capacities of 24MWe and 71MWth.

The UK Energy Technologies Institute (ETI) took a step towards developing a biomass-fired energy plant, calling for organisations able to operate a commercial scale pre-treatment system for biomass feedstock. According to ETI the facility is likely to "involve commercially viable technologies that have not yet collectively been commercially deployed in the UK."

A planning hearing to decide whether Indaver can build a €160m EfW plant in Ringaskiddy, Ireland, concluded. A verdict is due on 12 July, though planning body An Bord Pleanála said the date was "flexible". The 240,000 tonnes-per-year facility, would have an energy capacity of 18.5MWe.

Netherlands-based NGO Stichting Afvaloven Nee (SAN) launched a legal complaint against Omrin’s Harlingen EfW facility. SAN lost an attempt to overturn the facility’s planning permission last year. Its new complaint alleges that waste is being burnt at too high a temperature. A decision is expected in a few weeks time.

Pittsburgh-based Emerson won the contract to supply automation technology to the Allerton Waste Recovery Park in the UK. The company was awarded the contract by Vinci Environment on behalf of future operator AmeyCespa. When operational in two years, the site will treat about 320,000 tonnes of waste, with the majority being processed by an EfW plant with a capacity of 24MWe. A 1.1MWe biogas plant is being developed on the same site.

Germany-based EnviTec will build the biogas plant at the heart of DONG Energy’s innovative REnescience plant (pictured below) build in the UK. The company won the contract for the facility, which DONG said it would go ahead with earlier this year.

Finnish firms Stora Enso and KPA Unicon signed a deal for the latter to supply a biomass-fired boiler plant. KPA Unicon said it would build the latest facility at Stora Enso’s sawmill in Honkalahti, Finland. The plant will use Unicon’s Biograte technology, which is designed for wet biomass feedstock. It will have a heating capacity of 17.7MW when operational in August 2017.

Asdonkshof’s Kamp Lintfort EfW facility in Germany was hit by a second fire in a matter of months. The fire started in the facility’s waste bunker and lasted for more than three hours. The plant started operating in 1997, can process up to about 270,000 tonnes of waste a year and has capacities of 30MWth and 22MWe. In January it was hit by a similar fire also in its waste bunker. No one was injured in either incident.

Engie-owned Fabricom won the contract from M+W Group relating to construction of the Energy Works Hull EfW facility. M+W Group have the EPC contract for the 28MWe and 10MWth plant and Fabricom will act as principal engineer providing design work with a focus on the plant’s water steam cycle. Engie also has a deal in place to operate the plant once it is operational in 2018 with Hull-based engineering business Spencer Group as developers of the project.

Haminan Energia’s biogas-to-grid facility in Virolahti, Finland, was officially opened. The project’s main contractor was BioGTS. The plant will use a dry fermentation process to produce around 10GWh of biogas per year and is permitted to process about 12,000 tonnes of food and agricultural wastes per year, although it has a capacity of 19,500 tonnes.

Up to 15,000 people protested against an EfW development in Florence, led by NGOs Zero Waste Italia and Mamme No Inceneritore, which translates as Mums Against Incineration. Q.tHermo, a consortium owned by waste management firms Quadrifoglio (60%) and Hera (40%) got the green light last August to develop the Case Passerini plant. If built it would have capacities of about 17MWth and 15MWe and process up to 198,000 tonnes of municipal waste a year.

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