Polskie Stowarzyszenie Biometanu - Biometan Biogaz Biomasa OZE

The numbers clearly show the gap that separates Poland from the rest of Europe in the number of biogas and biomethane installations. What are the main barriers to development and proposals for removing them - this is what Marek Pituła, president of the Polish Biomethane Association, talks about in the latest interview.

Teraz Środowisko: How many biogas installations do we have and what is the (dis)proportion relative to Europe?

Marek Pituła: At the end of 2023, in Poland we had, according to the President of the Energy Regulatory Office, 358 installations (with an electrical capacity of more than 50 kW) with a total electrical capacity of 295 MW, which, if they produce at full installed capacity, should produce about 600 million Nm3 of biogas converted to biomethane. Almost half of these are agricultural biogas plants, of which there were 167 as of the end of June 2024. These are installations with a total declared production of about 400 million Nm3 of biogas converted to biomethane and an installed electrical capacity of 156 MW.Meanwhile, there are nearly 20,000 biogas and 1,548 biomethane installations in Europe with an annual production capacity of 6.4 billion Nm3.In 2022, the combined production of biogas and biomethane in Europe accounted for 6% of total natural gas consumption. This means that in order to reach the level of the European average, we should produce 3 times more biogas and biomethane, or about 1.2 billion Nm3 per year, for which we would use just over 12% of the existing technical potential of biogas substrates in Poland.

TŚ: What about the implementation of the National Indicative Target (NIT)?

MP: If we are going to at least come close to realizing the National Indicative Target (NIT) in 2030 of a 13.5% share of renewable fuels in the total consumption of all fuels in transport, a political decision is needed at the government level - do we want to realize the above targets with Polish forces, generating a model effect of positive economic, environmental and social synergy between the energy sector and agriculture in the broadest sense. Or are we already preparing to import biomethane from abroad, already created in some part from Polish substrates exported from western and northwestern Poland.Assuming an 11% increase in transportation fuel consumption by 2030 and an NCW of 13.5%, in 2030 we should have about 50 TWh of energy in biofuels, currently we have 21 TWh (including 8 TWh from biodiesel, 12 TWh from bioethanol and 1 TWh from “other biofuels”. To achieve the NCW in 2030, it would be necessary to make ambitious assumptions, under our conditions, of a 150% increase in the production of bioethanol, biodiesel, “other biofuels,” and the production of at least 1.5 billion Nm3 of biomethane in 2030.Failure to produce enough biofuels in 2030 exposes NCW implementers to about 12-15 billion zlotys in penalties annually.The ability to produce 1.5 billion Nm3 of biomethane per year would require the construction of 200-250 large-scale installations over 5 years, which in total is not impossible, e.g. in France 198 installations came in 2022-2024, and 374 in the whole of Europe. The example of France and to some extent Italy shows that there are potentially such possibilities, after all we still have a few years until 2030.

TŚ: Of the dozens of development barriers, you have diagnosed the 6 most significant, along with proposals for their removal. What to change above all

MP: This is nothing revelatory, these are the same problems that the industry has been pointing out for many years. First and foremost, a market for biomethane must be created (realistically), because it doesn't currently exist. A definite boost to the creation of a biomethane market would be the enactment of the Law on Amendments to the Law on Biocomponents and Liquid Biofuels and Certain Other Laws (currently being processed under UC 28). The draft law is already after departmental and public consultations.The bill, in its current content, will de facto launch the biomethane market, particularly in the area of using liquefied biomethane (bioLNG) as a direct transportation fuel.The obligation of obligated entities to dispose of a certain volume of biofuel (failure to do so is subject to penalties) creates demand and creates a price of 1 MWh of biofuel at around 125-135 euros, which is in line with the prices that in France and Italy triggered a surge in biomethane production several years ago.Therefore, work on the draft should be completed as soon as possible and sent to the Diet. Amendments and changes that are necessary - can still be made to the bill in the legislative process at the stage of work in the Parliamentary and/or Senate Committees.The second major issue is that of land for investment and protection of agricultural land. What we are dealing with now is a complete misunderstanding, hence the demand that agricultural land, e.g. of up to 3 hectares and classes IV - VI, be immediately freed from the regulations of the Act on Formation of the Agricultural System - on condition that these plots of land are allocated for the construction of biogas/biomethane facilities. This land occupies about 51% of all arable land in Poland, which is about 7.5 million hectares of agricultural land, so for 250 biomethane installations we would engage one hundredth of a percent (!) of this land. “Defenders” of these few hundred hectares on a national scale should think about the sense of their actions in the broader context of implementing both the NDC and reducing greenhouse gas emissions in general.

TŚ: And in terms of investment and operational funding, what do you propose?

MP: This is the third topic - first of all, the same rights and obligations should be introduced for any legal form of investor - no preference for cooperatives, clusters, “family farms up to 300 hectares,” etc. A biomethane installation with the capacity to produce, for example, 6 million Nm3 of biomethane per year, must cost 60 to 120 million zlotys, the own contribution alone for such an investment is no less than 10 million zlotys. Such amounts could be afforded, for example, by producer groups, but I admit that so far I have not heard of any group undertaking this type of investment. I believe more in joint ventures with farmers - growers, who will be reliable suppliers of substrates.So it would be beneficial for the development of projects to introduce bonus criteria: the degree of preparation of the investment, having contracts with substrate suppliers, the cost of the investment and the time of its implementation. Well, and the key issue, the introduction of auctions for larger installations (above 1 MW of electricity equivalent, i.e. with an annual production capacity of more than 22 MWh of energy in biogas/biomethane, which has already been specifically announced by Minister Motyka on July 12 this year at a joint meeting of two parliamentary committees. If we want to start a race for biomethane, such an auction should be held later this year, with the flexible threat of penalizing non-performance of the contract concluded with the winner of the auction - for example, at 65%, which the Minister also announced in total. While auctions are not a perfect model, for larger biomethane projects there is no other option, unless you don't want to use the operating support system.

TŚ: Another barrier is grid connections. You point to two key parameters: combustion heat and absorption.

MP: Yes, this is the fourth topic. If, as announced so far, all forms of biomethane will be treated equally in all respects, this fourth issue may not become a so-called “deal breaker.”Currently, the situation for the gas form is hopeless - there is no way to connect to the gas distribution network, for example, in the case of the Polish Gas Company (PSG). Specifically, the PSG has 321 Oil Heat Settlement Areas (ORCS), including 300 for high-methane natural gas. If we assume that a reasonably safe limit for a biomethane source is 97% methane content in biomethane (already after taking into account the 4% “in minus” tolerance acceptable to PSG), only in 73 cases there is a theoretical possibility to connect to the distribution network due to the heat of combustion of gas - in a given settlement area, with as many as 64 out of the mentioned 73 points being in the Tariff Area “Tarnow”. And it just so happens that only a few of these settlement areas can provide continuous offtake of, for example, 1,000 Nm3 of biomethane throughout the year. But that's not all, the heat of combustion in the PSG network has been rising in recent years (probably due to the higher heat of combustion of LNG imported from the US or the Persian Gulf). In one of the billing areas we checked, the average annual heat of combustion from 2021 to mid-2024 increased by almost 1 MJ, and the monthly fluctuations during this period were up to 1.9 MJ, or 4.7% of the variable methane content of biomethane (with no reduction allowed).That is, even these few or a dozen points are in question, for what guarantee do we have that tomorrow more ships won't arrive from the Gulf and the heat of combustion will increase so much that we won't be able to supply biomethane to the grid from, say, the middle of the year....There are relatively simple ways to solve this problem, after all, of the 1,548 biomethane plants in Europe, up to 80% are connected to the grid.This problem is fortunately not present in the case of GAZ-SYSTEM, there and the absorption capacity is practically unlimited and the requirements for combustion heat are to be met by virtually any biomethane installation. However, there are other problems of a regulatory nature, fortunately relatively easy to remove, with basically no significant investment.

TŚ: What about substrates?

MP: This is the fifth topic, I think there should be incentives for farmers - suppliers of substrates for biogas/biomethane installations and those using the digestate product. I'm thinking primarily of subsidies per hectare of land fertilized with the digestate product, which has the approval of the Ministry of Agriculture and Rural Development (at the moment it is already in the eco-scheme “carbon farming” - but is the same as for natural fertilizers). Meanwhile, these subsidies could be higher - after all, the use of digestate product significantly reduces greenhouse gas emissions compared to natural fertilizers.In addition, it would make sense to introduce an investment support program for producers of full-value fertilizers based on the digestate product - the idea is to supplement the composition of the digestate product with missing components (possibly not from mineral fertilizers) without losing the status of fertilizer - the digestate product.This should solve the problem of substrates related to agriculture, especially livestock farming, primarily one that requires the use of roughage.

TŚ: The final Achilles' heel on your list is public awareness and acceptance, or rather, the lack thereof.

MP: This is the sixth and last of the important but solvable problems hindering the emergence of a biomethane market in Poland. I consider it necessary to conduct an information campaign for all local government units on the importance of biomethane as an energy carrier and store for the entire economy and a way to ensure energy security on a national and local scale. The information campaign should target the agricultural sector - about the importance of the carbon footprint in the context of the expected labeling of food products with information about the size of the carbon footprint, especially in industries exporting Polish food products to foreign markets. By working with biogas facilities, we can reduce the carbon footprint at the livestock farm stage by as much as one-third, that is, to be on par with countries such as Denmark or Sweden, and maintain the competitiveness of our exports of, for example, milk.In conclusion, none of the above barriers is critical, each is surmountable.

TŚ: Let's add that the Polish Biomethane Association is a member of the “Agreement on Cooperation for the Development of the Biogas and Biomethane Sector” and you are the coordinator of Group 5, which deals with identifying barriers limiting the development of the biogas and biomethane market and proposals for their removal. If you were to rank the aforementioned recommendations in order of importance for the emergence of the biomethane market in Poland, what would be their order?

MP: No. 1: Market (here things seem to be moving in the right direction, a bit of a carrot-and-stick approach);

No. 2: Investment support (here, as of last Thursday, we have a new program of the National Environmental Protection and Water Management Fund with a budget of as much as PLN 4 billion, it's a pity that it's only for biomethane from biodegradable waste, maybe in the consultation process it will be possible to expand the list of substrates at least to include feedstocks related to livestock production);

No. 3 Operational support (here, in the area of government declarations, things are also moving in the right direction - auctions);

No. 4. substrates (there is a swallow in the form of subsidies for the use of digestate product in fertilizer, it would be good if there were more);

No. 5. Public acceptance (thoughtful locations and real benefits for local communities - especially in the form of heat for heating);

No. 6. connections to the gas grid (here a lot depends on the flexibility of operators, but there is after all an alternative in the form of bioLNG, i.e. production of direct transport fuel and its delivery without the involvement of the grid, this should make grid operators think, especially as we are working on cheaper two-in-one technologies than before, i.e. treatment and liquefaction in one process line.

Interviewed by: Katarzyna Zamorowska, Teraz Środowisko

Interview with the CEO of the Polish Biomethane Association in ,,Teraz Środowisko"

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