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European Biogas Association Cross-border biomethane trade for supporting the expanded use of methane as transportation fuel in Europe Lodi, 19 th June, 2015

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Page 1: European Biogas Association Cross-border biomethane trade for supporting the expanded use of methane as transportation fuel in Europe Lodi, 19 th June,

European Biogas Association

• Cross-border biomethane trade for supporting the expanded use of methane as transportation fuel in

Europe

Lodi, 19th June, 2015

Page 2: European Biogas Association Cross-border biomethane trade for supporting the expanded use of methane as transportation fuel in Europe Lodi, 19 th June,

Biomethane as vehicle fuel

• Natural gas (NG) and biomethane are complementary to each other, • Bio-CNG and Bio-LNG are blends of NG and bioCH4 to be marketed

jointly by NG and biogas industries,• The biomethane component improves the GHG emission reduction

potential of CNG/LNG,• HDV’s, city buses, municipality vehicles, ships, etc.

Lodi, 19th June, 2015

Page 3: European Biogas Association Cross-border biomethane trade for supporting the expanded use of methane as transportation fuel in Europe Lodi, 19 th June,

Methane as vehicle fuel – forecast 2025

Source: Chris Le Fevre, Research Fellow Oxford Institute of Energy Studies OIES Paper NG84

Page 4: European Biogas Association Cross-border biomethane trade for supporting the expanded use of methane as transportation fuel in Europe Lodi, 19 th June,

Biomethane trade

The functions of cross-border trade:

a) balancing supply and demand on regional and European level (beyond national borders)

b) enabling production at places/regions with the highest comparable advantage

Lodi, 19th June, 2015

Page 5: European Biogas Association Cross-border biomethane trade for supporting the expanded use of methane as transportation fuel in Europe Lodi, 19 th June,

Challenges of biomethane trade

•Value of biomethane: physical (in use) value + intrinsic („bio”) value

•Intrinsic value: „green”, renewable, sustainable •The intrinsic value can be quantified (GHG emission figure)•Condition for sustainable biomethane production:

• intrinsic value must be realised on the market•Conditions for biomethane export/import:

The „bio” quality must be certified in the producing country The „bio” qualification from the producing country must be

acknowledged in the consuming country The mass-balancing requirement must be met

Lodi, 19th June, 2015

Page 6: European Biogas Association Cross-border biomethane trade for supporting the expanded use of methane as transportation fuel in Europe Lodi, 19 th June,

Well-to-Tank GHG emissions indicative numbers

Source: JRC-EUCAR-CONCAWE (JEC) consortium WtT Report 2014

Page 7: European Biogas Association Cross-border biomethane trade for supporting the expanded use of methane as transportation fuel in Europe Lodi, 19 th June,

The arts of biomethane trade

Lodi, 19th June, 2015

Page 8: European Biogas Association Cross-border biomethane trade for supporting the expanded use of methane as transportation fuel in Europe Lodi, 19 th June,

Potential solution

As a potential solution we may suggest an Annex to COM 2010/C 160/01

which would address the following biomethane related issues:

1. sustainability verification for biomethane injected into the European natural gas network,

2. cross-border transfer of volumes and mass balancing of biomethane in the European natural gas network,

3. definition of European natural gas network,4. definition of national biomethane registries and their role in

cross-border mass-balancing,5. averaging GHG emission figures for biogas raw material

mixtures.

Lodi, 19th June, 2015

Page 9: European Biogas Association Cross-border biomethane trade for supporting the expanded use of methane as transportation fuel in Europe Lodi, 19 th June,

National biomethane registries are needed

• Independent, neutral, professional organisations• Established through government actions or voluntary cooperation of

market players• Track, confirm and document the biomethane transactions along

the contractual chain• Administrative support in meeting regulative requirements• Independent audit controls• Assisting trade development through building market confidence

Guarantees of Origin Guarantees of Sustainability

Lodi, 19th June, 2015

Page 10: European Biogas Association Cross-border biomethane trade for supporting the expanded use of methane as transportation fuel in Europe Lodi, 19 th June,

Lodi, 19th June, 2015

Summary: Main factors for success

1. Overall development of NGV market

2. Right political priorities, political support for biomethane (as advanced biofuel)

3. Broad marketing cooperation between the natural gas and biogas industries

4. Monetizing the intrinsic („green”) value on the market

5. Reduction of biogas/biomethane production costs

6. Feasible possibilities for cross-border trade

Page 11: European Biogas Association Cross-border biomethane trade for supporting the expanded use of methane as transportation fuel in Europe Lodi, 19 th June,

Thanks for your attention!Dr. Kovács Attila

European Biogas [email protected]

Lodi, 19th June, 2015

Page 12: European Biogas Association Cross-border biomethane trade for supporting the expanded use of methane as transportation fuel in Europe Lodi, 19 th June,

ILUC Directive Annex IX – list of biogas raw materials qualified for double counting

”non-food cellulosic material” means feedstocks mainly

composed of cellulose and hemicellulose, and having a

lower lignin-content than ligno-cellulosic material; it

includes food and feed crop residues (such as straw,

stover, husks and shells), grassy energy crops with a low

starch content (such as ryegrass, switchgrass, miscanthus,

giant cane, cover crops before and after main crops

etc), industrial residues (including from food and feed crops

after vegetal oils, sugars, starches and protein have been

extracted), and material from biowaste;

Lodi, 19th June, 2015

Page 13: European Biogas Association Cross-border biomethane trade for supporting the expanded use of methane as transportation fuel in Europe Lodi, 19 th June,

Biogas industry in Europe

• Biogas production: ~ 15,7 Mrd m3 methane/year, ~ 3% of NG consumption

• BioCH4 production:

~ 1,0 Mrd m3 methane/year~ 0,3 Mrd m3 used as vehicle

fuel • ~ 14.600 biogas plants• ~ 300 upgrading units• BioCH4 production in: AT, CH, DE, DK,

ES, FR, FI, HU, IS, IT, LX, NL, NO, SE, UK

Source: EBA Biogas Report 2014

Page 14: European Biogas Association Cross-border biomethane trade for supporting the expanded use of methane as transportation fuel in Europe Lodi, 19 th June,

Woodfuel UK Source: REA

Page 15: European Biogas Association Cross-border biomethane trade for supporting the expanded use of methane as transportation fuel in Europe Lodi, 19 th June,

Lodi, 19th June, 2015

Page 16: European Biogas Association Cross-border biomethane trade for supporting the expanded use of methane as transportation fuel in Europe Lodi, 19 th June,

Biomethane – national markets

UK: Fixed FIB + gas market value up to 11,0

€Cent/kWh FR: Fixed FIT 6,4 – 9,5 €Cent/kWh

depending on capacity (350 m3/h– 50 m3/h) and substrates

example: 150 m3/h, 50% manure+50% org. waste > 9,38 €Cent/kWh

DK: Guaranteed biomethane feed-in-bonus (FIB) IT: FIT set by law, 8,0 – 10,0 €Cent/kWh NL: SDE+ scheme, „biotickets” for vehicle fuel use AT: „Technologiebonus“ at green electricity generation DE: Biofuel GHG emission reduction certificates SE: Complex support system, incl. tax relief FI: Tax relief, (high taxes for fossile vehicle fuels) NO: Tax relief till end 2015

Kecskemét, 23rd April, 2015

Page 17: European Biogas Association Cross-border biomethane trade for supporting the expanded use of methane as transportation fuel in Europe Lodi, 19 th June,

Biomethane quality will be regulated by CEN standards elaborated in TC 408

a) for grid injection

b) for vehicle fuel use

Kecskemét, 23rd April, 2015