Biogas in Portugal: Status and public policies in a European context

Energy Policy 43 (2012) 267–274

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Biogas in Portugal: Status and public policies in a European context Miguel Ferreira a, Isabel Paula Marques b, Isabel Malico a,c,n ´vora, R. Roma~ o Ramalho, 59, 7000-671 E ´ vora, Portugal Physics Department, University of E ´rio Nacional de Energia e Geologia, Lisbon, Portugal LNEG – Laborato c IDMEC/IST, Technical University of Lisbon, Mechanical Engineering Department, Av. Rovisco Pais, 1049-001 Lisbon, Portugal a

b

a r t i c l e i n f o

abstract

Article history: Received 20 December 2010 Accepted 3 January 2012 Available online 28 January 2012

The current status and legal framework of biogas production in Portugal are analyzed and compared to that of five other European countries, characterized by wide-ranging diversity of substrates and biogas applications. With this comparison, and with the calculation of the biogas energy potential in Portugal, the authors want to assess the significance of developing the Portuguese biogas sector. This study illustrates that the highest biogas feed-in tariffs are applied in the countries with a more developed sector. In Portugal, despite the fact that the organic effluents are a relevant energy source (873 Mm3 biogas per year; 4889 GW h yr  1) and that new feed-in tariffs were established, biogas valorisation is still at an early stage. The importance of anaerobic digestion was only recognized in 2007 and the present installed power is about 10% of the potential electrical power (229 MW). Therefore, it is desirable to strengthen the national and regional biogas market. & 2012 Elsevier Ltd. All rights reserved.

Keywords: Anaerobic digestion Biogas Policy

1. Introduction The International Energy Agency has referred in the World Energy Outlook 2007 that ‘‘many of the policies available to alleviate energy insecurity can also help to mitigate local pollution and climate change, and vice versa’’ (IEA, 2007). The implementation of biogas as a renewable energy source (RES) has this triple role: (i) it decreases the dependency on fossil fuels, like coal, oil and natural gas, since it is a high quality fuel and a solid alternative to more conventional fuels; (ii) it can be produced from almost all kinds of organic feedstock, from the primary agricultural sector to various waste streams of human activity, giving an answer to the inadequate management of industrial, agricultural and domestic wastes and improving the fertilizer quality of manure, reducing the odours and inactivating pathogens (Holm-Nielsen et al., 2009); (iii) it reduces the methane (CH4) emissions, a gas with a greenhouse warming potential 25 times higher than carbon dioxide (CO2) (Pettus, 2009). Since 1997, the European Union (EU) has been congregating efforts to reduce climate change effects and to support the use of renewable energies. In that year, the White Paper on Renewable Energy Sources and the Kyoto Protocol established the first EU countries’ obligations. The 12% renewable energy share by 2010 was

n Corresponding author at: Physics Department, University of E´vora, R. Roma~ o Ramalho, 59, 7000-671 E´vora, Portugal. Tel.: þ351 266 740 800; fax: þ 351 266 745 394. E-mail addresses: miguel.fl[email protected] (M. Ferreira), [email protected] (I.P. Marques), [email protected] (I. Malico).

0301-4215/$ - see front matter & 2012 Elsevier Ltd. All rights reserved. doi:10.1016/j.enpol.2012.01.003

set. In 2001, the EU Directive 2001/77/EC on the electricity produced from renewable energy sources (RES-E) guaranteed the incorporation of electricity produced from renewable sources in the market, demanding that all Member States established indicative goals for the RES-E. The Member States targets were compatible with the EU global indicative goals: by 2010, 12% of Europe’s gross final energy consumption and 22.1% of its electricity production had to come from renewable energy sources. The latter was lowered in 2004 to 21% with the entrance of ten new Member States in the EU. The European transport sector, responsible for more than 20% of the CO2 emissions, was also object of the EU strategy. The EU Directive 2003/ 30/EC on the promotion of biofuels for transport aimed at increasing and developing the use of biofuels with the substitution of 5.75% of the gasoline and diesel consumption by biofuels up to 31 December 2010. In this Directive, biogas for transport is included in the biofuels definition. In 2005, the Biomass Action Plan was adopted and measures to increase the biomass energy development in Europe were set out. In 2008, the European Parliament Resolution of 12 March on sustainable agriculture and biogas recognized that biogas is a vital energy source that could contribute significantly to binding the EU renewable energy targets. The European Commission published on 23 April 2009 a new Renewable Energy Directive (EU Directive 2009/28/EC on the promotion of the use of energy from renewable sources amending and subsequently repealing Directives 2001/77/EC and 2003/30/ EC), that set new targets to all Member States: at least a 20% share of energy from renewable sources in the Community’s gross final consumption of energy and a 10% share of renewable energy in the transport sector in 2020.

According to the EurObserv’ER estimates (EurObserv’ER, 2010), in 2009, the European renewable primary energy consumption increased to 156 Mtoe, a 9.4% share. The two most represented sectors are biomass, that accounts for two-thirds (66.6%) of this consumption and hydroelectricity (19.7%). RES-E has also grown in the EU-27, from 371 TW h (1997) to 584.1 TW h (2009), with hydropower remaining the dominant source of RES-E (55.8%, in 2009) (EurObserv’ER, 2010). Biomass ranks third accounting for 18.3% of the renewable electricity generation. Based on these estimates, the RES-E share rose to 18.2% in 2009, 2.8% below the 2001 Directive’s target (EurObserv’ER, 2010). In 2009, the biofuels’ share by energy content in the total road transport fuel consumption was 4% (12 Mtoe) and a 4.7% share was estimated for 2010 (EurObserv’ER, 2010). Biodiesel consumption dominates by far the biofuel consumption in Europe. In 2008, the primary energy consumption from biomass targeted 98.6 Mtoe within the EU-27 and an estimate of around 103.9 Mtoe was made for 2009 (EurObserv’ER, 2010). The 2005 European Biomass Action Plan estimated that biomass (solid biomass, liquid biomass, biogas and renewable municipal wastes) could contribute for around 150 Mtoe by 2010. This target is still far from being attained and the relative contributions of the various types of biomass used to reach Europe’s goals will depend on the Member State Governments and European Union policies. Following the European trend, biomass accounts for the majority of the Portuguese renewable primary energy consumption (DGEG, 2010a). However, in 2008, the relative contribution of the Portuguese biogas for the biomass primary energy consumption did not reached 1% (DGEG, 2010a), a figure which is lower than the 8% relative contribution of the EU-27 biogas for the bioenergy primary consumption (EurObserv’ER, 2009). This, in conjunction with the high biogas potential of Portugal, shows that this important sector has been somehow neglected. It is in this context that this study was undertaken. The main focus of the work is the Portuguese biogas potential, current production and public policies. A general description of the current status of the European biogas production is given. In order to get more specific information on management and public policies of biogas sector, five European Countries (Austria, Denmark, Germany, Spain and Sweden) were described in more detail. The Portuguese legal framework for biogas production is compared to those of other five European countries; the current status of biogas in these counties is reviewed and some conclusions are taken with respect to the support schemes and success of the biogas promotion policies. Additionally, the biogas potential of Portugal is calculated, in order to highlight the country’ possibilities as far as biogas valorisation is concerned. For this calculation only the available organic effluents were considered, leaving energy crops, for instance, out.

2. European biogas production It is estimated that more than half of the European biogas production is valued, being the remainder burnt in flares (Abraham et al., 2007). Fig. 1 shows the European primary biogas production from 2000 to 2009. In 2008, the European primary energy production from biogas reached 8 Mtoe and the estimates for 2009 point in the direction of 8.3 Mtoe (EurObserv’ER, 2010). These figures correspond to an increase of around 70% with respect to 2000. The year 2007 was a turning point for the European biogas, since landfill biogas stopped being the main source of the European biogas (EurObserv’ER, 2009). In this year, and also in 2008 and 2009, about half of Europe’s biogas production came from agricultural biogas units (combining liquid manure with substandard cereals, for instance), centralised co-digestion units (liquid manure with other

Primary biogas production (ktoe)

M. Ferreira et al. / Energy Policy 43 (2012) 267–274

9000 8000 7000 6000 5000 4000 3000 2000 1000 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009* Year

Fig. 1. Primary biogas production in the European Union (2000–2009) (*estimate).

9000 Primary production of biogas (ktoe)

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Other Biogas Sewage Sludge Gas Landfill gas

8000 7000 6000 5000 4000 3000 2000 1000 0

2004

2005

2006

2007

2008

2009*

Year Fig. 2. European primary biogas production sources (2004–2009) (*estimate).

organic matter and/or animal waste) and solid household waste methanisation units (in Fig. 2 referred to as ‘‘other biogas’’). In the last years, these biogas sources have become the real driving force for the growth of biogas production in Europe. The number of this type of units have had an enormous growth, passing from 1500 units in 2001 to 2000 units in 2004 (Abraham et al., 2007). With the pass of time, the biogas sector in Europe is changing its primary objective from waste treatment to energy production and currently the purpose-designed energy conversion methanisation plants account for more than half the biogas primary production. Biogas energy is mainly recovered in the form of electricity (EurObserv’ER, 2010). The amount of biogas produced, the productions channels and its end-use varies significantly in the different EU countries. Germany is by far the European leader in the biogas sector with more than half of the European primary energy output. In this country the planting of energy crops was encouraged and that explains the fact that this country became the one that produces the most biogas. Germany’s position is followed by the United Kingdom, France and Italy, three countries that rely on landfill gas. Most EU countries are paying attention to the biogas sector and have included biogas roadmaps as part of their national renewable energy action plans. If they hold on to their roadmaps, European biogas will continue to grow and Germany will continue to be the leading contributor in Europe.

M. Ferreira et al. / Energy Policy 43 (2012) 267–274

To promote the use of renewable energy sources, the EU Governments offer several incentives, choosing each country its own scheme. An attractive legal framework is needed to support the biogas sector and the policy chosen by each country is decisive for the growth of the sector. It is clear that different incentives result on diverse biogas production channels and end-uses. For instance, a country that sets an attractive feed-in tariff for landfill gas favours this biogas source and electricity production. Almost all the European Union Countries adopt biogas energy feed-in tariffs (for example, Sweden is an exception). The next sections describe the current status of biogas in five European Countries – Austria, Denmark, Germany, Spain and Sweden – in order to get information about diversified scenarios on the biogas management. These countries were chosen due to their distinct position on biogas production, since they are located in the top 10 of the European rank of biogas primary production (2008), and by their diversity of the substrates digested and biogas applications: the biogas sources in Germany, Austria and Denmark are predominantly energy crops, agricultural by products and manure, while Spain mainly produces landfill gas and Sweden sewage sludge gas; Sweden has established a market for biomethane-driven cars, whereas Germany and Austria predominantly use their biogas for electricity production and Denmark has almost exclusively combined heat and power (CHP) units. 2.1. Austria The production of renewable energy in Austria is dominated by large hydropower and biomass heat production (European Renewable Energy Council (EREC), 2009a). The EU Directive 2009/ 28/EC target for Austria is 34% share of energy from renewable sources in its gross final energy consumption in 2020. In 2007, this share was 28.8% (European Renewable Energy Council (EREC), 2009a) and according to Statistik Austria (2011) around 30% in 2010. The Austrian RES-E target in Directive 2001/77/EC is 78% in 2010. In 2007, 65% of the consumed electricity in Austria came from renewable sources (European Renewable Energy Council (EREC), 2009a) and in 2010 the number was similar (Statistik Austria, 2011). The majority of this electricity is produced by large hydropower plants, followed by solid biomass and wind power. These figures confirm that Austria is one of the leading countries in renewable energy production and consumption. According to the EurObserv’ER (2009), in 2007, Austria was the 5th biggest producer of biogas primary energy in the European Union (216.9 ktoe). The vast majority of this production came from agricultural biogas production units (95%) and most of these plants use mainly energy crops for digestion (Braun et al., 2007). Since there was an increase of the prices of these agricultural raw materials, in 2007, the rate of installation of new small production units declined (EurObserv’ER, 2008). A EurObserv’ER (2010) estimation indicates that, in 2009, the Austrian primary biogas energy production was 165.1 ktoe, relegating the country’s to the seventh position in the European Union. Due to the past attractive feed-in tariffs with no efficiency requirement, the majority of the biogas produced in Austria is used for electricity production only (Braun et al., 2007). According to the EurObserv’ER (2010), in 2008, Austria was the 6th European country in terms of biogas electricity production (602.0 GW h). The same source estimates that Austria produced 638.0 GW h of electricity from biogas in 2009. In Austria, electricity from renewable sources in general and biogas in particular is mainly promoted through feed-in tariffs. ¨ kostromgesetz) entered into In 2002, The Green Electricity Act (O force. This legal instrument regulates the support scheme for RES-E and the use of certificates of origin. It was amended in 2006 but the less favourable and partly insecure investment conditions

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caused a stagnation of new RES-E development. It was amended again in 2008 with some of the amendments taking effect or being further revised in 2009. Meanwhile, new feed-in tariffs for renewable electricity were determined in 2010 by the Federal ¨ kostromverordnung 2010). Ministry for Economics and Labour (O For biogas from agriculture products and waste, the base feed-in tariffs depend on the size of the plant, ranging from 0.13 h/kW h to 0.185 h/kW h. Additionally, tariffs are reduced 20% for biogas from the co-fermentation of waste materials. A supplement of 0.02 h/kW h is received when used in efficient cogeneration or for treatment of natural gas quality. The tariffs are guaranteed for 15 years. 2.2. Denmark Denmark was one of the few countries worldwide that, since the 1970s, maintained a strong focus on renewable energies. Energy security, self-sufficiency and efficiency have been the objectives of this policy over time (Lipp, 2007). Since 1999, Denmark has been self-sufficient in energy and in 2007 registered 130% self-sufficiency, being the only country in the EU with this status (European Renewable Energy Council (EREC), 2009b). According to the EU Directive 2009/28/EC, in 2020, 30% of the Danish gross final energy consumption should come from RES. The RES-E target in Directive 2001/77/EC is 29% by 2010. In 2007, 27.9% of the gross electricity production was based on renewable and RES covered 17% of the gross final energy consumption (European Renewable Energy Council (EREC), 2009b). In 2007, biomass was responsible for more than 80% of the consumption of renewable energy (DEA, 2009). In Denmark, the first biogas plants were installed as a consequence of the 1973 energy crisis, when high energy prices stimulated farmers, research centres and technology companies to investigate the generation of energy from manure (Raven and Gregersen, 2007). The story that followed is considered a solid success and almost 40 years of research, experimentation and biogas units installation resulted in one of the most developed nation as far as biogas is concerned. In 2008, Denmark produced a total of 93.8 ktoe biogas, ranking 10th on the European Union’s biogas primary production (EurObserv’ER, 2010). On a per capita basis Denmark is one of the best performing European country (EurObserv’ER, 2008). Like in Austria, most of the Danish biogas production (72% in 2008) comes from agricultural plants (EurObserv’ER, 2010). Denmark is well known for the centralized biogas plant concept, where a farming community cooperates and supplies a single biogas plant (Raven and Gregersen, 2007). In 2008, sewage sludge and landfill gases accounted for 21% and 7% of the biogas production, respectively. Denmark has almost only co-generation units (Eriksson and Olsson, 2007) and in 2008, these plants were responsible for 99% of the 271.3 GW h electricity production from biogas (EurObserv’ER, 2010). In Denmark, electricity from renewable sources is promoted through a variable premium paid on top of the market price. The Promotion of Renewable Energy Act, which entered into force on 1 January 2009, guarantees a total price for the electricity produced from biogas of 0.745 DKK/kW h (0.097 h/kW h on the beginning of November 2010). The premiums and market prices will be index-adjusted annually. Furthermore, Denmark allocates subsidies to small-scale renewable energy systems. In Denmark biogas is eligible for net-metering under certain conditions. 2.3. Germany The EU Directive 2009/28/EC establishes that at least 18% of the gross final energy consumption of Germany should come from RES in 2020. In 2008, 9.5% of the country’s final energy consumption

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came from renewable energy sources, mainly biomass (BMU, 2009). Regarding electricity production from renewable sources, the target of the EU Directive 2001/77/EC is 12.5% by 2010. The German Government set a new target of 30% RES-E by 2020. In 2008, 15.1% of the total electricity consumption came from renewable energy sources, of which, 1.3% came from biogas (BMU, 2009). In recent years, Germany has become the European leader in biogas production, recording more than 4.2 Mtoe in 2008 (EurObserv’ER, 2010). Its primary biogas production has increased eight times since the year 2000. This impressive rise is due to the strong development of agricultural biogas production units, which in 2009 were about 5000 with 1900 MW of electrical capacity (EurObserv’ER, 2010). This source (alongside with municipal solid waste methanisation plants and centralized CHP plants) represented 84% of the biogas primary production in 2008, a 4% increase in relation to 2007 (EurObserv’ER, 2010). Biogas from landfills and sewage sludge gas account for 7% and 9% of the total production, respectively. To increase the gas yield most facilities used co-fermentation of manure with other wastes. However, due to the more stringent regulations concerning hygiene and nutrient recycling, this treatment is less used (Weiland, 2006). In the last years, energy crops became an alternative and nowadays they are the primary substrates for these methanisation units (According to EurObserv’ER, 2008, 98% of the new units digest energy crops). Estimations indicates that the number of installations rise to 5800 in 2010 with 2300 MW of electrical capacity. Electricity production is the main destination for the German biogas (Eriksson and Olsson, 2007). In 2008, 9979 GW h were produced from biogas, which makes Germany the European leading biogas electricity producer (EurObserv’ER, 2010). In Germany, the most important legal instrument in the promotion of electricity from renewable sources is the Renewable Energy Source Act (Erneuerbare-Energien-Gesetz – EEG) which came into action in 2000, replacing the Electricity Feed-in Act. Since then it has been amended three times, in 2004, in 2008 and most recently in 2011. This instrument regulates the preferential connection of the renewable energy power plants to the grid and the purchasing, transmission and payment of electricity by the operator of the grid. It also sets the payment rates for each kilowatt-hour of renewable electricity that is fed into the public grid. These differ according to the type of renewable energy source, conversion technology and plant capacity. The most recent EEG amendment reduced the feed-in tariff sliding scale from 1.5% to 1% from 2009 onwards. The base 2009 feed-in tariff for electricity coming from biomass plants with less than 150 kW is 0.1167 h/kW h, decreasing in steps with installed capacity. Premiums for electricity produced from agricultural biogas, liquid manure or waste materials resulting from cleaning natural open spaces are applied, as well as premiums for CHP, technology or emissions reduction. The EEG guarantees the plant operators fixed tariffs for electricity fed into the grid for a period of 20 years, plus the year it was taken into operation. At the same time, the Government approved a new law for promoting the injection of biomethane into the gas network. The aim is to replace 10% of the natural gas consumption with biogas as of 2030 (EurObserv’ER, 2008). In 2009 there were 35 enrichment plants in operation (EurObserv’ER, 2010). 2.4. Spain Spain strongly depends on energy imports and its energy intensity is high. According to the MITYC (2010), oil and natural gas dominate the primary energy consumption, while renewable energy sources accounted for 9.4% of this consumption in 2009 (biomass was the main contributor – 41% of RES). The EU

Directive 2009/28/EC target for this country is 20% share of energy from renewable sources in its gross final energy consumption in 2020, while Directive 2001/77/EC established that 29.4% of the electricity should to be produced from RES by 2010. In 2009, the share of RES in electricity production is 24% (MITYC, 2010). In 2008, Spain’s production of primary energy from biogas was 203.2 ktoe, the 6th highest in the EU. The most important sources are landfills (77%). As far as electricity is concerned, Spain produced 584 GW h from biogas in 2008 (EurObserv’ER, 2010). Spain’s Governments started the promotion of RES in 1980 with the publication of Law 82/1980 for the Conservation of Energy. In 1999, the Plan for the Promotion of Renewable Energy (PFER) established a set of measures to meet the RES-E goal for 2010 and defined national targets per technology. This Plan was updated in 2005, increasing the share of RES-E target to 30.3%. The National Action Plan for Renewable Energies (PANER) 2011–2020 determines Spain’s action in order to meet the EU Directive 2009/28/EC targets (MITYC, 2010). Royal Decree 436/2004 defined that RES-E producers may sell their electricity to suppliers or directly to the market. In both cases, support was associated with the average electricity tariff, set annually through a Government decision. On May 2007, a new Royal Decree was published; Royal Decree 661/2007 regulates the production of electricity under a special regime applicable to RES-E and dissociated the support of RES-E from the average electricity tariff. For biogas units up to 50 MW, operators can choose between receiving a feed-in tariff price or a feed-in premium paid on top of the market electricity price. The feed-in tariffs are paid during the entire time of a system’s operation, but reduced after 15 years. For biogas units between 50 and 100 MW, operators receive a bonus amount for the electricity produced. Units bigger than 100 MW are not eligible. It is the Spanish Order ITC/3519/2009 that reviews the most recent feed-in tariffs and the premiums for biogas installations. The tariffs and premiums depend on the size and type of unit. For biodigesters, the maximum tariff, 0.141207 h/kW h, is the 15-year feed-in tariff for cogeneration units up to 500 kW. 2.5. Sweden Sweden plans to be the World’s first oil-free economy by 2020 (European Renewable Energy Council (EREC), 2009c). The EU Directive 2009/28/EC target for this country is 49% share of energy from renewable sources in its gross final energy consumption in 2020, while Directive 2001/77/EC established that 60% of the electricity should be produced from RES by 2010. In 2005, the share of RES in the gross final energy consumption was 39.8%, in 2006, RES-E was 48.47% and, in 2007, the share of RES in the total primary energy consumption was 31.29% (European Renewable Energy Council (EREC), 2009c). As far as biogas is concerned, Sweden differs from the previous countries on three fundamental issues: source, final use and type of incentives. In 2008, 56.3 ktoe of the 102.4 ktoe Swedish biogas primary production was sewage sludge gas, while the second most important source were landfills (EurObserv’ER, 2010). For 2009, EurObserv’ER (2010) estimates a 6% rise in the biogas production (109.2 ktoe). Despite these statistics, it is the agricultural biogas that presents the biggest growth potential in Sweden (SGC, 2007). As far as biogas utilization is concerned, this country is particularly active in biomethane production. During 2006, almost 24 million Nm3 of biogas were used as vehicle fuel in Sweden (SGC, 2007). This was the first year where more biogas was sold as vehicle fuel than natural gas (SGC, 2007). 2007 confirmed this trend with 28 million Nm3 of biogas, corresponding to 19% of Sweden’s biogas production, being sold as automobile fuel (EurObserv’ER, 2008). Another difference between all the countries analysed in this paper and Sweden is the type of instrument used for the promotion

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of RES. In 2003, the Government introduced a law instituting a green certificate system. The Electricity Certificates Act obliges energy suppliers and certain users to prove that a certain quota of their electricity comes from RES. The energy producers receive a certificate for each MW h produced from renewable energy sources, which they sell to users according to a quota obligation. Sweden has other support measures to promote RES, as for example CO2 taxation on fossil fuels. Also, the Government grants a subsidy of 30% of the investment for the construction of biogas units and introduced a set of measures to increase the alternative fuel pumps and the usage of biofuel cars.

3. Portuguese biogas production Like Spain, Portugal strongly depends on energy imports and its energy intensity is high. According to DGEG (2010a), oil dominates the primary energy consumption. The EU Directive 2009/28/EC set a 31% target for the Portuguese share of energy from RES in its gross final consumption of energy in 2020. The Portuguese National Renewable Energy Action Plan states that, in 2008, this share was 23.1% (RP, 2010). Regarding electricity production from renewable sources, the target of the EU Directive 2001/77/EC is 39% by 2010. The Portuguese RES-E is strongly dependent on the hydropower production, and the oscillations of the share of RES-E over the years reflect this dependency (31.1% in 2007, 27.8% in 2008 and 35.1% in 2009 (DGEG, 2010b)). In 2008, the primary biogas production in Portugal was 23 ktoe (EurObserv’ER, 2010). The only sources for the Portuguese biogas are agricultural biogas production units, municipal solid waste methanisation plants and centralized co-digestion plants. The main application of the biogas is electricity production. In 2010, 97 GW h electricity were produced in the Portuguese biogas units and in September 2011, 38.9 MW were installed (DGEG, 2011). Fig. 3 shows the evolution of the Portuguese electricity production from biogas between 2001 and 2009. This renewable energy source presents a mean installation rate growth of 53.4% between 2002 and 2009, the third highest in Portugal (DGEG, 2010b). Unfortunately, in Portugal, the real value of anaerobic digestion (AD) was only officially recognized in 2007 with the publication of the Decree-Law no. 225/2007 of 31 May. In the previous Decree-Law, the economic valorisation of the landfill

Fig. 3. Portuguese biogas electricity production and cumulative installed capacity (2001–2010).

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gas was higher than that of the biogas obtained by recycling organic matter. With this incongruity, the most interesting biogas valorisations from the environmental point of view, such as the biological treatment of animal waste, industry effluents, sewage sludge and organic fraction of municipal solid wastes, were excluded. In 2007, the feed-in tariff for biogas from AD more than doubled, giving this energetic valorisation a relevant place. In Portugal, renewable energy production has priority access to the grid in terms of grid planning and expansion. The generation of electricity from RES is mainly promoted through guaranteed feed-in tariffs. Additionally, a set of financial and fiscal incentives for the promotion of RES were created. In 1988, a feed-in tariff based on the electricity tariff for consumers was introduced (Decree-Law no. 189/88 of 27 May). Later, on 1999, in the context of the Electricity Independent System (SIP), the activity of the Portuguese electric energy sector was reviewed, in particular as far as renewable energies were concerned (DecreeLaw no. 168/99 of 18 May). The feed-in tariffs started to be independent of the electricity tariff for consumers. In 2001, Decree-Law no. 339-C of 29 December, introduced attractive and differentiated feed-in tariffs for the different renewable energy technologies and defined the licensing and grid connection regimen. Due to this regulation, licensing of renewable energies increased from 100 MW yr  1 to 700 MW yr  1 and the implementation time of the projects was reduced from four to two years (DGEG, 2005). In 2005, Decree-Law no. 33-A/2005 of 16 February reviewed the calculation factors for estimating the values of the feed-in tariffs for energy produced from renewable sources. With this Decree-Law, incentives to encourage the adoption of renewable energies through Government legislation were maintained and mechanisms to encourage fast project implementation times were defined. In the same year, the Council of Ministers Resolution no. 169/2005 of 24 October established the National Strategy for Energy, which aims to ensure the security of energy supply through the diversification of primary resources, while stimulating and encouraging competition and ensuring the environmental sustainability of the entire electricity system. The fulfilment of these objectives set the target for Portugal by 2010: 39% of the final electricity should be produced from renewable energy sources. The intensification and diversification of the use of renewable energy sources for electricity production was thus reinforced. Later, and having as framework the National Strategy for Energy, Decree-Law no. 225/2007 of 31 May implemented some measures related to renewable energies, mainly as far as the evaluation of environmental impacts, energy remuneration criteria and simplification of licensing procedures are concerned. In 2008, the Council of Ministers Resolution no. 1/2008 of 4 January defined a new target for Portugal: 45% RES in the final energy consumption (DGEG, 2009); new targets for each technology were also provided. More recently, the Council of Ministers Resolution no. 29/2010 of 15 April approved the most recent Portuguese National Strategy for Energy (ENE 2020) that continues the promotion of renewable energy sources. The Portuguese National Renewable Energy Action Plan (PNAER) presents the future Portuguese guidelines in terms of RES (RP, 2010). As a consequence of the ENE 2020, the Government proposes to revise the feed-in tariffs. In the last couple of years, the indicative biogas feed-in tariff for anaerobic digestion ranged from 0.115 to 0.117 h/kW h, while for landfill gas from 0.102 h/kW h to 0.104 h/kW h (RP, 2010). It should be pointed out that feed-in tariffs have not been listed explicitly in the wording of the law, but are calculated monthly for each plant based on avoided costs. This causes some administrative complexity and low transparency. Tariffs are guaranteed for 15 years. As far as biogas is concerned, the PNAER states that biomethane injection in the natural gas grid should be regulated,

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in order to promote other uses for the produced biogas. Till now, no expansion of the natural gas grid was made for the injection of biomethane and, in an initial stage, a viability analysis will be performed for each specific project. A regulated tariff for the supply of biomethane could be considered in the future. PNAER sets a target for the biogas installed capacity by 2020: 150 MW. It should be stated that in 2003, the Portuguese Government set the target of 50 MW installed capacity of biogas power by 2010. This indicative target was reviewed and the Portuguese Government committed to moving it from 50 MW to 100 MW. However, in July 2010, with 22 MW installed, Portugal was still far from its biogas goals. 3.1. Biogas potential in Portugal The main producers of organic effluents were selected and the valorisation by anaerobic digestion of the substrates that are available, accessible and affordable was taken into consideration in order to estimate the biogas energy potential in Portugal. Three relevant areas were found: municipal solid wastes and wastewaters, livestock breeding and food industry (Table 1). National statistics were used to determine the number of animals of the livestock breeding sector and the produced volumes by the food industry and municipal sectors (APA, 2009; INE, 2003, 2008). Several scientific and technical information (Cronin and Lo, 1998; Demirel et al., 2005; Moletta, 2005; Paraskeva and Diamadopoulos, 2006; Qin et al., 2001) allowed estimating the national production of waste and the corresponding biogas production. It was considered that all organic effluents are anaerobically digested. In the sector of municipal wastewaters only primary and secondary sludge of the main process stream (activated sludge process) are submitted to anaerobic digestion. It is also assumed that the resulting biogas contains 65% of methane. The exception concerns the landfill gas with a methane concentration of 50%. Regarding the energy production, biogas is converted in a combined heat and power generator. 3.1.1. Municipal wastes and wastewaters The municipal sector is very important for the biogas production. The municipal solid wastes (MSW) that are stored in landfills are still rich in organic matter which gives rise to biogas production under anaerobic conditions. In controlled facilities where Table 1 Attainable biogas and energy productions from different sectors. Biogas (Mm3 yr  1)

Electric and thermal energy (GW h yr  1)

402.92

2256.352

Municipal wastes Municipal solid wastes (organic fraction) Municipal wastewaters (sludge) Total

70.60

395.36

473.52

2651.712

Livestock breeding Cattle Pigs Chickens Total

258.12 48.44 44.80 351.36

1445.472 271.264 250.88 1967.616

26.1 7.6 4.9 4.5 3.8 1.3 48.2

146.16 42.56 27.44 25.2 21.28 7.28 269.92

873.08

4889.248

Food industry Dairy products Baker’s yeast Olive oil Slaughterhouses Breweries Wineries Total Global

sealed cells are equipped with a gas collection system, it is possible to take into account the energy recovery of this source. Another potential substrate for AD process is the sludge (primary and secondary) resulting from wastewater treatment. For populations over 10,000–15,000 inhabitants it is economical to carry out anaerobic digestion of the sludge with biogas production (Novais and Marques, 2002). Given the tendency for the installation of centralized treatment plants comprising several municipalities or geographic regions, the importance of the sludge segment will tend to grow. The sector of MSW has a higher energy potential than the wastewaters (Table 1). Together they represent the greatest potential for energy production (54%). However, it must be pointed out that the sector is misrepresented because there are other treatment processes in competition with the anaerobic digestion such as activated sludge or composting and this may not be reversible in the short term (Freitas and Marques, 2008). 3.1.2. Livestock breeding Cattle breeding represents the largest potential of biogas production in the animal sector (Table 1). Portugal has a huge number of farms that need to treat their own wastes. By using the anaerobic digestion process, it is possible to reduce the flow volume of effluents and get more than 50% of organic matter removal; The biogas thus produced, needs to have a destination. Presently, most units with this type of equipment use the biogas only to provide heat to the facility itself (Novais and Marques, 2002). 3.1.3. Food industry The effluents from the food industry are composed mainly by organic matter and therefore can be beneficially valorised through AD process. In Portugal, the food industry sector presents a potential for biogas production far below the two sectors previously analysed (municipal and animal). Among the different food industries (barker’s yeast, olive oil, slaughterhouses, breweries and wineries), the dairy products segment represents about half of the total potential for biogas production (54% vs. 46%, Table 1). The biogas potential of all sectors evaluated (873 Mm3 biogas yr  1) corresponds to an electric potential of about 2008 GW h yr  1, which represents 3.75% of the 53,558 GW h total electricity produced and imported in Portugal in 2008 (DGEG, 2010b). Currently, the biogas installed power is 22 MW, about 10% of the potential electrical power (229 MW). If the thermal energy is recovered through co-generation (2881 GW h yr  1), it is possible to obtain a global energy potential of around 4889 GW h yr  1.

4. Biogas management comparison in six European countries/ Table 2 presents a summary of the key aspects analysed in this paper for the six European countries studied. It shows the 2020 RES targets set in the EU Directive 2009/28/EC and the 2010 RES-E goals established by the EU Directive 2001/77/EC. In the Spanish and Portuguese cases, the National Governments set higher RES-E targets, which are the ones presented in the table. The primary biogas production and the electricity produced by biogas in 2008 are also indicated. Germany is the European leader in terms of production of biogas and electricity from biogas and it is the country that guarantees for a longer period a fixed remuneration for the electricity from biogas. In Germany, biogas feed-in tariffs are also very attractive. Table 2 presents indicative electricity remunerations for the countries studied, considering two illustrative installed powers: 250 kW and 1 MW. In the German case, only the base value is given, but if all the bonuses are accounted

M. Ferreira et al. / Energy Policy 43 (2012) 267–274

273

Table 2 Comparison of the biogas production and legal framework in the six European countries studied. Denmark

Germany

Portugal

Spain

Sweden

34 78 174.5

30 29 93.8

18 12.5 4229.5

31 45 23

20 30.3 203.2

49 60 102.4

602

298.7

9979

71

584

30

0.165 þ bonus 0.13 þbonus 15

0.097 0.097 Adjusted annually

0.0918þ bonus 0.0825þ bonus 20

0.117 0.115 15

0.141 (CHP) 0.105 (CHP) 15

Green certificates

for, the 250 kW unit feed-in tariff can reach around 0.25 h/kW h and the feed-in tariff for the 1 MW unit around 0.20 h/kW h. Austria is the third (in 2007, it was the second) biggest biogas producer from the six countries analysed and it presents the second highest remuneration. If this analysis is extended to Denmark and Spain, countries where variants of the feed-in scheme are implemented, the proportionality between biogas production and remuneration is evident. This shows the success and advantages of the feed-in tariffs scheme or its variants: investment security and possibility of fine-tuning. From the six countries analysed, Sweden is the only one that implemented the more risky green certificate system. Although Portugal presents higher biogas electricity remuneration than Denmark, the Portuguese feed-in tariff is at the lower end and the country is producing less biogas than the other five countries analysed. This reflects, on one side, the relatively new Portuguese Governments’ bet on anaerobic digestion and, on the other side, a generalized investors’ fear. The fact that a financial/ economic crisis followed the changes in the Portuguese feed-in tariffs amendment does not help in the development of the biogas sector in Portugal. Biogas installations require relatively large investments and, currently, loans are very hard to obtain. Therefore, the financial crisis is a real barrier to the development of the biogas sector in Portugal. The support of high feed-in tariffs favours electricity production, and so, countries like Germany, Austria or Portugal use mainly their biogas for electricity production. Sweden, on the other hand, has promoted preferentially other end-uses (heat and injection into the natural gas grid). Fig. 4 shows the primary biogas energy production per capita for the six European countries analysed, according to the EurObserv’ER (2010). Germany, that promoted purpose-built energy recovery methanisation plants, clearly presents higher primary biogas energy production per capita than the rest of the countries analysed. The high feed-in tariffs set by its Government and the more recent incentives for biomethane injection into the natural gas grid imply that the country still wants to attract investors and allow for an expansion of the biogas sector. For instance, if we compare the biogas sector with the photovoltaic, Germany, also the European leader as far as photovoltaic energy is concerned, set lower PV feed-in tariffs than the countries with less mature markets (e.g., Portugal). (Carvalho et al., 2011). This is not the case for the German biogas sector, indicating a clear bet of the German Government in this area. In Portugal, a biogas production channel that has been overlooked as far as energy production is concerned, is the municipal sector (wastes and wastewaters). Portugal, of the six countries analysed, is the one that has lower primary biogas production per capita. The feed-in tariffs set for the country are inline with those

Primary biogas energy production per capita (ktoe/1000 inhabitants)

RES targets 2020 RES (%) 2010 RES-E (%) Primary biogas production in 2008 (ktoe) Electricity production from biogas in 2008 (GW h) Electricity remuneration 250 kW (h/kW h) 1 MW (h/kW h) Period (years)

Austria

60 50 40 30 20 10 0 Austria Denmark Germany Portugal

Spain

Sweden

Year Fig. 4. Primary biogas energy production per capita for the six countries studied.

of the other countries analysed, but electricity is the only end-use that is clearly promoted (biomethane still does not have the advantage RES-E has benefited from in the electricity sector). The fact is that the substitution of natural gas by biogas requires heavy infrastructure investment and, therefore, it is harder to set up. Additionally, in Portugal there are logistic barriers for this injection, since the natural gas grid is not distributed evenly throughout the country and instead it is concentrated on the west coast.

5. Conclusions The comparison of the biogas policies in the six European countries analysed reveals that, in general, electricity production from biogas has been favoured till now and that the countries with a more developed biogas sector are those who apply the highest feed-in tariffs for electricity from biogas. In Portugal, there is a huge untapped biogas potential, but only in 2007 was the importance of AD recognized. Presently, biogas electricity does not reach 4% of its generation potential, which demonstrates the necessary of continuing and strengthening the investments in the biogas sphere. Clearly, the country needs to promote the implementation of biogas valorisation plants in order to meet its goals and resource availability is not the problem. The implementation of smaller-scale projects, mainly treating available

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