Despite Brexit: Biogas plants from Melle for the UK
Although the construction of anaerobic digestion (AD) and wind power plants continues to stagnate in Germany, not least due to the blocking tactics emanating from Berlin, BioConstruct GmbH can again look back on a good year. One reason for this is a good market presence within the UK, where BioConstruct have built seven AD plants in 2019, and reinforced its position as a leading technology provider for the design and construction of turnkey anaerobic digestion plants. A further reason is the trend towards biomethane injection and the corresponding feed-in tariff for it in France.
With a plant near Magdeburg, which was successfully commissioned last year, BioConstruct has also demonstrated that AD plants can still be built even here in Germany. In overall terms, the company has maintained turnover at a pleasing level of circa 48 million Euros in its core business of AD plant construction and services. As Managing Director Henrik Borgmeyer points out: “You also have to take into account that we have already invested in a lot in projects which will be commissioned this year, and which will only then have, , a positive impact on the financial results due to the German tax law.”
Seven biogas treatment plants built in the UK in 2019
At present, BioConstruct does not anticipate any reversal of the positive developments in the UK, despite Brexit. “For the time being, it’s beneficial to us that a clear decision has been made,” says Borgmeyer. Since the UK left the EU, sterling has remained relatively stable, which makes planning easier. The general development of the UK market in the long term depends partly on the outcome of negotiations with the EU during the transition period until the end of the year. Furthermore Henrik Borgmeyer is looking forward to a decision by the British government on the possible reinstatement of the RHI (Renewable Heat Incentive) expected in March.
During 2019, around 57% of BioConstruct’s turnover was generated in the UK. As a proportion of the overall performance, this was around 62%. The seven projects which were built are all biogas upgrading plants, which upgrade the biogas to biomethane (natural gas quality) and feed this into the national grid where it is used for heating. A medium-sized combined heat and power unit is also operated on each site, with an installed electrical capacity of 499 kW which sustainably covers the plant’s own power requirements. Altogether the seven plants, which for the most part recycle agricultural and industrial waste, produce more than 3,500 cubic metres (Nm3) of biomethane per hour. This corresponds to the heating requirements of approx. 10,000 households. BioConstruct is currently in negotiations for further projects of comparable size in the UK for start of construction in 2020.
Biomethane feed-in for agricultural businesses in France
BioConstruct also sees further opportunities for biogas in France, as it is the only renewable energy source to supply base load heat and power when solar and wind power are temporarily unavailable. For the current year, planning is already underway for several biomethane plants. However, the focus here is different from in the UK: the projects are mostly part of agricultural businesses and their average size is usually smaller, with an installed capacity of roughly 125 Nm3 biomethane injection per hour. In most cases, the feedstock for the plant is on farm slurry, manure, vegetable waste, waste from agribusinesses and catch crops. Borgmeyer is cautiously optimistic: “Due to the high level of compensation, the boom in France will still continue for now, but a reduction of the tariff has already been announced.”
Exciting challenges in eastern Europe, Asia and the USA
With its sights set on further European markets, BioConstruct is hoping for eminently positive effects from the EU Commission’s Green New Deal. “In eastern Europe, there are still a few sleeping giants out there as far as biogas is concerned: Poland, Romania, Hungary and Bulgaria”, says Borgmeyer. There are also further exciting prospects internationally. Experts from BioConstruct´s headquarters in Melle are currently involved in the design and engineering work for a project in Hong Kong. Also, initial steps have been taken in the USA, where the expansion of an existing AD plant is planned, and there is the prospect of some new projects, although a few organisational challenges still need to be overcome in respect of these.
Energy policy in Germany: blocking tactics from Berlin must stop
With a view to the market in Germany, the current energy politics of the German government is a disaster for BioConstruct. “They have resolved to phase out fossil fuels at far too great a cost, without creating a level playing field for cheaper and cleaner alternatives. Obstacles to the expansion of renewable energy are being put in the way everywhere, whether with blanket requirements for distance from residential buildings being imposed for wind turbines, or the failure to include biogas in the Building Energy and Combined Heat and Power Act,” complains Borgmeyer. With this procrastination and delay, BioConstruct regards a cost-effective energy transition with security of supply as being seriously at risk: “No withdrawal from traditional energy sources without start-up of renewables!”