Biomethane
is a clean, sustainable gas produced from organic material such as green waste;
food waste; agricultural waste and industrial waste, through a biological
process known as anaerobic digestion (AD). This gas can be combusted to
generate electricity and heat or can be cleaned to remove impurities and
upgraded to biomethane, to be injected into the gas distribution network, used
as a vehicle fuel or to displace natural gas in commercial and industrial
applications. Biomethane is set to become an important element of the global
future energy strategy, helping to meet environmental targets while reducing
reliance on gas imports.
Since
the launch of the REPowerEU plan in May 2022, there is an urgency to transport
Europe’s energy system and biomethane is expected to make a significant
contribution. As a result, NNFCC was approached by a global sustainable energy
producer with a keen interest in investing in the European AD market. With good
knowledge and data of markets across Europe, and strong connections in key
active and interested member states, NNFCC was engaged to explore and analyse
market opportunities.
As
part of the engagement, the team undertook a high level analysis of the AD
sector in six European countries: the Netherlands, Germany, Denmark, France,
Ireland and Italy gathering information about national and local energy
strategies, sustainability policies and current or future planned biomethane
incentive mechanisms. At the same time, data was collated on national feedstock
availability, current AD capacity and existing transport, storage and
distribution infrastructure, to establish where the greatest potential and most
imminent opportunities were evident.
In
addition to the country-specific analysis, it was also necessary to map out
details of national biomethane trading schemes and relevant trading platforms,
to determine where cross-border trade was permitted and likely to occur. To do
this, key stakeholders in the biomethane market (production, handling and use)
were identified and mapped.
A
high level options appraisal was then performed, to identify how and where
opportunities could align with the clients’ existing business interests, and to
select priorities for further consideration.