EWB Insight: November 2016

This month: The Winter Package launches a new chapter for waste and bioenergy, EfW growth led by Asia and a full facilities round up

To read the report as a PDF click here

Winter Package: a strategic win for bioenergy

The release of the revised EU renewable energy directive (RED II) by the European Commission starts a new chapter in debate over the management and development of waste and bioenergy in Europe.

The debate will be incredibly rich in detail. Not all the Commission’s proposals will benefit the sector and the fortunes of different branches of bioenergy could diverge. But the first thing to note is that, overall, the proposals represent a strategic win for bioenergy.

Europe’s environmental movement has increasingly identified bioenergy as the unacceptable face of renewable energy. In the build up to publication of the Winter Package NGOs challenged the sector’s very legitimacy and demanded that Europe’s approach should set strict limits on its use and growth.

But the European Commission has rejected this philosophy. It acknowledges that there are environmental challenges associated with bioenergy. But its starting point is therefore to put in place mechanisms to align it more closely with sustainability.

This is clear in the Commission’s impact assessment of bioenergy sustainability that accompanies the RED II proposal. Key objectives of EU policy, it says should be to "promote the prudent and rational utilisation of biomass as a natural resource", "ensure bioenergy’s positive contribution to reducing greenhouse gas emissions", and to "avoid or limit harmful impacts of bioenergy on the environment".

EU governments and the European Parliament must still have their say on RED II and doubtless the environmental movement will continue fighting its corner. But the Commission’s basically positive orientation towards bioenergy will be an important reference point in all these discussions.

No wonder initial industry reaction to RED II welcomed the Commission’s "pragmatism" while NGOs spoke of "greenwashing".

Data Watch

EfW-rising.jpg

Europe’s EfW capacity will continue steady growth through to 2025, with throughput rising from slightly more than 100 million tonnes of waste in 2015 to nearly 125 million tonnes by 2025, consultancy Ecoprog has forecast.

The sector is set to grow much faster in booming Asia, where EfW is forecast to reach nearly 300 million tonnes throughput by 2025. North American capacity is forecast to decline slightly as ageing plants are not replaced.

Policy Insight

The European Commission’s Winter Package of energy legislation drew mixed reactions from waste and bioenergy industry groups, which welcomed aspects of a draft new Renewable Energy Directive but expressed concern at others. Environmental groups were strongly critical, alleging that the proposals "only greenwashed" bioenergy.

The European Commission defended its involvement in the forestry sector in the European Parliament after MEPs disputed its right to propose EU legislation since forestry is a policy area absent from the EU treaties. Swedish MEP Fredrick Federley criticised the Commission’s promotion of using biomass as a material rather than for energy purposes. He argued it should "be up to the landowner to decide to whom to sell the product and what it should become".

EU member states should introduce carbon taxes or levies to encourage renewable heating and cooling, a report from the EU-funded FROnT project recommended. Ideally, such a tax would be set at EU level, it said. But, acknowledging the difficulties of getting unanimous agreement between governments it recommended national schemes instead.

NGOs launched several salvos at the bioenergy sector this month including a demand for a legal cap to be set on the use of bioenergy at 152 million tonnes of oil equivalent (mtoe). Environmental groups calculated this to be the highest level that could be delivered sustainably and without increasing Europe’s ecological footprint through biomass imports.

A UK-based NGO called for an ‘incineration tax’ as MPs released a report criticising the UK Treasury department over the way the UK’s landfill tax has been developed. UK Without Incineration Network (UKWIN) said a change in the way in which waste processing was taxed to boost recycling, rather than energy recovery, was needed.

The UK government excluded biomass conversion from its next round of UK renewable electricity price support. The UK’s second round of Contract for Difference (CfD) auctions will begin in financial year 2021-22. Part of the £290m (€324m) funding will include support for dedicated biomass with CHP, anaerobic digestion and advanced conversion technologies such as gasification and pyrolysis.

Britain’s Association of Bulk Terminal Operators (ABTO) warned some deepwater ports may close unless the government becomes more supportive of conversion of coal-fired power stations to biomass. Falling coal and iron imports have not been offset by biomass imports as expected, ABTO warned.

Sweden’s bioenergy industry called on the government to reform the country’s renewable electricity support scheme to favour "steerable" (technically dispatchable) power sources. Due to a variety of factors, including removal of a tax on nuclear power and lower electricity demand than forecast, the price of green certificates had fallen. As a result "producers lose money, including public utilities that have invested in biomass CHP."

UK-based renewable utility Ecotricity claimed virtually all domestic heating in the country could be supplied via grass-based biomethane, pumping £7.5bn (€8.7bn) per year into the rural economy. The company is developing its own grass-to-biomethane plants. It ambitious plan says 5,000 such plants, each of 5MW capacity, could meet the UK’s needs.

UK trade associations the Renewable Energy Association (REA) and the Wood Heat Association (WHA) launched a campaign urging government to prioritise ‘sustainable, affordable, and low-carbon’ biomass to help decarbonise heat supplies.

The German bioenergy sector criticised government suggestions it might seek to limit the role of bioenergy in achieving mid-term decarbonisation targets. Ten industry groups, including BBE (bioenergy),FvB (biogas) and VDB (biofuels), raised concerns in response to a discussion paper called Electricity 2030.

Market Update

Brussels-based trade body the European Biogas Association (EBA) withdrew an attack on the newly formed World Biogas Association (WBA) having claimed the UK-based WBA was "a private company" and could therefore not claim to be a representative. However, only two days after releasing its attack, the EBA conceded the WBA is a legitimate trade association by issuing a correction.

Poland could achieve the milestone of 1GWe of biogas capacity by 2023-5, according to analysis by developer BioAlians. Poland currently has 301 biogas plants with 231MWe of capacity, about half of them agricultural and one quarter each landfill gas and sewage gas, but this is behind government’s 2010 growth scenario. Recent policy changes hold out hope of a big further expansion, which will mainly be in agricultural biogas, BioAlians added.

Energy company Steag took over two German EfW plants with a combined processing capacity of nearly half a million tonnes as it launched a new businesses in the sector. The plants, in Rüdersdorf near Berlin and Lauta, Saxony were bought for an undisclosed fee from Sweden’s Vattenfall.

Norway-based heating company, Statkraft Varme sold one of two small biomass-fired facilities it put on the market earlier this year. The district heating plant in Klæbu was bought by Klæbu Bioenergi, which was set up in 2014. Currently, the plant has a heat capacity of 7.1MW and produced 4.9GWh in 2015, by processing woodchips and briquettes.

Swedish utility Göteborg Energi revealed cooperation with French utility company Engie to develop biomass gasification technology. The aim is to replace some of the 500TWh of natural gas used in France every year with biogas, according to Göteborg Energi, which developed Europe's first large-scale biogas production facility based on biomass gasification known as GoBiGas.

The lack of an operating large-scale torrefaction plant is a "credibility gap" holding back the black pellet sector, vice-president of US-based technology supplier TSI Andrew Johnson told AEBIOM’s European Bioenergy Future Conference in Brussels. This is undermining efforts to sign up potential customers, Johnson said. Facilities able to produce at least 4-5,000 tonnes per year are needed to prove the benefits of torrified pellets, he said.

Denmark-based DONG Energy said the biomass sector needed to "shout louder" about its achievements or risk being sidelined by other renewable energy technologies. Speaking at AEBIOM’s conference in Brussels the firm’s executive vice president, Thomas Dalsgaard, said the industry needed to be prouder of its achievements.

Construction firm Interserve was removed as main contractor on the Glasgow EfW project. Interserve was awarded the contract, worth about £146m (€168m) in 2012 by waste management firm Viridor. The EfW plant, known as the Glasgow Recycling and Renewable Energy project,  is one of a handful of EfW contracts Interserve is still involved in after announcing plans to exit the sector. Interserve said it was taking legal advice.

US-based DuPont Industrial Biosciences and Germany’s MIAVIT revealed a deal to bring more enzyme technology to European biogas production. DuPont’s Fibrezyme G4 enzyme technology will now be available to MIAVIT’s customers as part of its MiaMethan ProCut biogas package.

Lithuanian-based Enerstena signed a deal with Spain-based Nova Energi to supply its biomass-combustion equipment to plants to the Iberian peninsula. Enerstena is active in the biomass-to-energy sector mainly in the Balkans and Eastern Europe, delivering large-scale facilities fired on wood pellets.

Facilities Update

UK-based Viridor committed to building its twelfth EfW plant after confirming it will go ahead with a facility located in Avonmouth, near Bristol. Construction will start next year and the plant will open in 2020. It is described as a "flagship" facility and will take up to 320,000 tonnes of waste annually and have a capacity of 33MWe.  

Viridor and technology supplier Babcock and Wilcox Vølund (BWV) revealed that construction had reached the midway point at the Dunbar EfW plant. The facility is costing £177m (€208.8m) to develop. When operational next year, it will process up to 300,000 tonnes of waste annually and have output capacities of 30MWe and 10MWth.

News emerged of two new EfW plants in Albania. The country’s first ever EfW plant opened this month in Elbasen. A second is being developed in Fier. The Elbasen plant has a capacity of more than 3MWe. The Fier facility will process up to 70,000 tonnes of waste per year and have a capacity of about 3.8MWe.

The European Commission announced it would co-fund several EfW and bioenergy research and pilot projects in EU member states under the LIFE Programme. In Sweden the HALOSEP project to co-treat two EfW plant waste products – fly ash and liquid – secured €5.4m in LIFE funding. Also featured was €1.5m of funding for construction of a novel biogas power plant in eastern Spain. The Ecoelectricity LIFE scheme aims to turn impure, commercially-unviable alcohol fractions into a hydrogen-rich biogas which it will generate electricity from via solid oxide fuel cells.

Czech Republic-based engineering firm Doosan Škoda Power said it would supply a complete machine hall and related equipment to the Amagerværket biomass plant in Copenhagen. The contract relates to the Bio4 facility that is being developed as part of the conversion of the plant. It has capacities of 415MWth and 150MWe and will process 1.2 million tonnes of woodchips per year.

NGOs sent an open letter to Denmark-based investment fund PKA urging it to reconsider its 50% equity investment in MGT Power's 299MWe capacity Teesside plant. The woodchip-fired plant, known as Tees Renewable Energy Plant, is being built by Spain’s Técnicas Reunidas and South Korea’s Samsung Construction and Trading.

Bulgaria-headquartered EfW plant builder Ebioss Energy announced deals to deliver two waste gasification plants in the UK in Hull and Newcastle. The Hull plant will have an electricity capacity of 20MW and will be able to treat up to 120,000 tonnes of RDF a year. The "Catfoss" facility in Newcastle has an electricity capacity of up 12MW and will process up to 72,000 tonnes per year.

Finnish utility Pori Energia announced plans to replace fossil fuel-based district heating in Pori and Ulvila with a new €50m biomass-fired facility by 2020. Two existing heating plants were built in 1968 and 1981 and supply 650GWh of heat annually, but are uneconomic to overhaul, according to the company.

A business developing a film studio in Scotland denied claims by NGO Biofuelwatch that it was planning to build a major wood-fuelled power plant with an output capacity of up to 100MW. Pentland Studios said the suggestion was "factually inaccurate".

The Nordic Investment Bank (NIB) gave a boost to construction of utility company Helen’s Salmisaari biomass-fired plant with a €22m loan. The NIB’s funding supports construction of the wood pellet-fired heating plant in Helsinki as well as an underground cooling centre. The Salmisaari plant will become the largest of its kind in Finland with a thermal capacity of 100MW, according to the NIB. The facility will deliver between 230 and 280GWh of heat annually when it becomes operational in February 2018.

An Estonian-based residual wood-fired heating plant was opened by forest industries firm UPM. The 18MWth Otepää plant was built by Austria-based Urbas.

Finland-based utility Fortum begun assembling a multifuel boiler at its new Zabrze heating plant in Poland. The facility is designed to process mainly coal, but will also take RDF and biomass. It is costing about PLN 870m (€196.6m) to develop. When operational in 2018 the facility will provide district heating to about 70,000 homes in Zabrze and Bytom.

Fortum is also working with Ericsson to use waste heat from the latter’s data centre to supply the district heating system of Kirkkonummi in southern Finland. Under the deal, for which no financial terms were disclosed, Fortum will use up to 15,000MWh of waste heat annually, enough for about 20% of Kirkkonummi’s yearly needs.

A group of Italian municipalities confirmed development of the Selvapiana EfW plant will be removed from the region’s waste plan. The facility was being developed by local authority-owned business Aer Impianti in the municipality of Rufina, a few kilometres from Florence, but faced public opposition.

An ageing EfW plant’s waste bunker capacity is being overhauled and equipment replaced after owner Zweckverband Thermische Abfallverwertung Donautal (TAD) said it would carry out the work. The firm’s Donautal facility was opened in 1991 and was originally expected to process only 120,000 tonnes of waste annually, but now treats 160,000 tonnes per year.

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