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Michael Köttner Belgrade , Serbia 19 February , 2014. GIZ DKTI Program „Development of a susatinable bioenergy market in Serbia “ Framework conditions for biogas production in Serbia Assessment of the biogas sector in Serbia – Summary of findings.
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Michael Köttner Belgrade, Serbia 19 February, 2014 GIZ DKTI Program „Development of a susatinablebioenergymarket in Serbia“Framework conditionsforbiogasproduction in SerbiaAssessmentofthebiogassector in Serbia – Summaryoffindings
Development in Germany related to Biogas technology • Over 100 regions, town and communities have +/- 100% supply in RE, partly based on biogas • Special bioenergy villages supply heat and power with biogas as a base load • Some regions have biogas as their main electricity source • Town of Kirchberg an der Jagst has 105% RE coverage in electricity • Town has 3 biogas plants, 5 wind energy plants, 5 hydro power stations, many photovoltaic plants
Tasks conducted Background assessment Stakeholder interviews public stakeholders commercial stakeholders private stakeholders Site visits at biogas plants
Background assessment Basis: available literature on biogas or biomass sector in Serbia (e.g. UNDP Baseline Assessment, Guide for Investors, relevant legislation, papers from GIZ and others) Assumptions & hypothesis: Permitting procedure is too complicated „One stop-shop“ is needed Difficult financing due to late issuing of priviledged power producer status and secure biomass supply Low level of knowledge on various administrative levels and at farmers
Stakeholder interviews Interviews have been conducted with Ministries on the national level National energy agency Provinical secretariat of energy and mineral ressources (Vojvodina) Universities of Belgrade (Faculty of Mechanical engineering) and Novi Sad (Faculty of Technical Science)
Stakeholder interviews Operators / Investorsofbiogasplantsorrepresentative Financial institution (Erste Bank) Biogas association Energyconsultant LawyerforEnergy Law
Existingbiogasplants in Serbia Vist & Interview Interview Vist & Interview Interview Interview
Velvet Farm, ČurugKey data / Site visit • throughputapprox. 37.500 t/a • feedstock: cattleslurryanddung, sugarbeetpulp, cornsilage • 4.000 m³ digestervolumeHRT = 40 d • CHP: 635 kWelinstalled
Mirotin Group, VrbasKey data / Site visit • throughput: 45.960 t/a • feedstock: cattleslurry, sugarbeetpulp, agriculturalresidues • 5.300 m³ digestervolumeHRT = 60 d • CHP: 1,6 MWelinstalled
Velvet Farm, ČurugPlausibility check plant sizing • Not enoughdataavailable
Lazar Dairy, BlaceKey data / interview • throughput: approx. 27.000–30.000 t/a • feedstock: cattleslurry, whey, cornsilage (oldone), molasses (non-continuous?) • 3.750 m³ digestervolume (estimationbased on oral information)HRT = 45-50 d (calculated) • CHP: 1,0 MWelinstalled; real outputbetw. 600 kWeland> 900 kWel(appro-ximation) www.dvoinc.net/howitworks.php
Plausibility check plant sizingLazar Dairy, Blaze, nomolasses
Plausibility check plant sizingLazar Dairy, Blace, withmolasses
Findings Positive results Biogas is on the agenda Legal framework conditions (e.g. gridconnec-tion, feed-in-tariff (FiT)) have been established Responsiblities of the authorities are defined Procedures for aquiring permits are defined and have beenpublished Buttherearemanybarriers.
Findings & BarriersEnergySector 1 FiTistoolow (andhasbeendecreasedcomparedtofirstimplementation) anddoesnot recognizethe real productioncosts SerbiahasthelowestFiT in theregion Applicationforpriviledged power producerstatusonly after completionofconstructionandstartofengine→ElectricitycannotbesoldtofullFiTfromthebeginning→ lost income Low levelofknowledgeaboutbiogasatutilitycompanies
Findings & BarriersLegislation & Permits 1 Varyinglevelofknowledgeaboutbiogas (anddifferencebetweenbiogasandbiomassplants) both in national andin localauthorities→ longapprovalprocess Applicationforpriviledged power producerstatusonly after completionofconstructionandstartofengine→ElectricitycannotbesoldtofullFiTfromthebeginning→ lost income High level (national) but lowpriorityfiresafetyapproval→ delay
Findings & BarriersLegislation & Permits 2 Approvalprocedure / permittingprocedureis easy, wheninvestorhas a strong position in theregionandknowsthelocalauthoritieswell WasteLaw: differentiationbetweenbiomassandwasteissometimesdifficult→barriertoutilise non-problematicwasteforenergyproduction (e.g. residuesfromjuiceproduction)
Findings & BarriersFinancing 1 Financingisonlypossiblewith high shareofownequityand / orownsupplyofsubstrates Return on investmentis 12 yearsorlonger→toolongtobeattractive Low trustofinvestors in thestabilityofSerbiangovernment, frequentchangesofframeworkconditions& no legal protectionofstatus quo (e.g. existingconstructionpermitbecomes illegal after amendmentoflaw) →hesistantinvestment
Findings & BarriersFinancing 2 Bad economicsituationoffarmers→difficulttoaccessfinancing (noattractivecustomer) Population in South-Serbiapaysa lowpriceforelectricityandheat (crosssubventionfromthe northern consumers) →lowwillingnesstoinvest in a technologythat will increasecosts Sometimesinvestorhastoco-financegridextensiontobiogasplant
Findings & BarriersAgriculturalSector 1 Highestbiogas potential isseen in agriculture, but agriculturalinstitutionsare not involved in deve-lopmentofbiogassector Generally lowproductivityofagriculture Underserbianconditionsonlythevery large agriculturalcompanieshavethemeansandknowledgetoimplementbiogasplants Concentration in animalhusbandry→lowernumberoffarmswithhighernumberofheads
Findings & BarriersAgriculturalSector 2 Deliverycontractswithfarmersare not reliable, iffarmercansellthecropatbetterconditionssomewhereelse→ high degreeofownproductionrequiredtosecurebiomasssupply→ landdemand Weakmeatindustryandreducednumberofanimalheadscomparedtopre-war times, supplyonlytolocalmarket Slaughterhousesrun in averageon 50% capacity→ lowprofitability→ noinvestment in biogastechnology
Findings & BarriersBiogas Sector Technology supplyfrom European orinternational companies→relatively high investmentcosts No national database on substratespecific gas yields, German valuesaretakenasreference No national laboratorytosupportorsupplyservicestothe national biogassector
RecommendationsLegislation 1 Re-calculation of FiT to make biogas plants econo-mically viable (maintenance & repair, replacements must be possible) →min 18 €ct/kWh would berequiredtobeattractive 1 coordinating authoritiy for the approval (one stop-shop) to reduce barriers for investors Extend preliminary status of priviledged power producer to biogas plants (apply for status parallel to construction permit) → to smoothen thetransitionbetweentest-operationand normal operation + eliminatefinanciallossesfortheinvestor
RecommendationsLegislation 2 Involve agricultural sector with its structure & training facilities (manure management, demon-stration plant, agricultural advisors) Investment subsidies to promote biogas technology as an emmission reduction technology Fire safety assessment on local level to speed up permitting procedure Establish an independent complaint office at higher level to open at least a 2. complaint instituton
RecommendationsAgriculture Manure management and methane emissions are an issue → biogas plants help to solve this Knowledge and a strategic approach is existing in the Ministry of Agriculture (e.g. Unit for Programming and Promotion of Rural Development) → should be involved more
RecommendationsGeneral Capacitybuilding on all levels (ministry, localauthorities, farmers / investors, banks) Collective residuedisposalplacesforsmallerfarms→feedstockfor „communal“ biogas plant →possiblywithdistrictheating „bioenergyvillage“ Serbianresearch on biogas→ national capacity / knowledge, biogas plant benchmarkingandsupportforoperators, might also be valid for WWT plants
Suggestion fornextsteps • Establishcontactandexchangeinformationwithotherprojects (e.g. dealingwithwastemanagement, manuremanagement, wastewatertreatment) toseewherecommongoalsmightbe • Involveagriculturalsectoranduseexistingstructure (e.g. agricultureextensionofficers, agricultureschools) fordemonstrationandpromotionofbiogas • Check optionstoestablish a national biogaslaboratory • Kick startwith a fewmore expert workshopsortrainingcourses
GIZ DKTI Program „Development of a susatinablebioenergymarket in Serbia“Framework conditionsforbiogasproduction in SerbiaAssessment ofthebiogassector in Serbia – Summary offindings Questions? IBBK Fachgruppe Biogas GmbH Am Feuersee 6 D-74592 Kirchberg / Weckelweiler Germany Tel. 0049 (0)7954 926203 Fax. 0049 (0)7954 926204 www.biogas-zentrum.de m.koettner@biogas-zentrum.de