Issue 1 April 2010
A D &Bio ga s N ews The UK Trade Association for the Anaerobic Digestion and Biogas Industries
Government fails to support anaerobic digestion (AD)
A
lthough the Department of Energy and Climate Change (DECC) has confirmed that the Government’s climate change targets will not be met without anaerobic
digestion, DECC’s announcement in early February of its
Britain will fail to meet its renewable energy targets without rapid building of a nationwide AD infrastructure.
response to the consultation on the Feed-in-Tariff (FiT) means that support for this sector has significantly reduced. is remarkable that DECC has not grasped the opportunity Lord Rupert Redesdale, Chairman of ADBA, commented:
to incentivise the AD industry, which can make a significant
“Britain will fail to meet its renewable energy targets
contribution to reducing the UK’s CO2 emissions now as well as
without rapid building of a nationwide AD infrastructure. It
generate a significant proportion of the UK’s energy.” Full story page 6 >
Inside this issue >
THE AN A E R O B I C D I G E S T I O N A N D B I O G A S A S S O C IAT I O N ’ S A N N UA L E X P O & C O N F E R E N C E
UK AD & BIOGAS 2010
What’s the hottest form of renewable energy?...
7-8 July, NEC
The UK’s first anaerobic digestion trade show!
C
page 4 >
AD training – where are the gaps?
UK AD & BIOGAS 2010
alling all farmers,
attend the ADBA Trade Show and
local authorities, waste
Conference, 7- 8 July 2010 at NEC the 7-8 July,
managers, supermarkets,
page 10 >
NEC (Birmingham) to find out all
landowners, and food process
they need to know about AD and
manufacturers – in fact anyone
see the latest AD equipment.
Member benefits update
See page 3 for details >
with AD on their mind should
page 13 > ✔ Circulation list
■
Managing Director
■
Finance Director
■
Sales/Business Development
■
Operations/Technical
■
Marketing Manager
Welcome Inside this issue > Cover Story: 1 Government fails to support anaerobic digestion (AD) Welcome: 2 Chairman’s foreword, Publication details Events: 3 The UK’s first AD and Biogas Exhibition ADBA News: 4-5 Meet the team, What is AD?, The role of ADBA Policy Update: 6-8 Government fails to support anaerobic digestion Regulatory Review: 10-11 AD training and EA permits Budget Review from Inenco: 12 Membership Matters: 13-15 Member benefits, New members, Working groups
AD & Biogas News Features List A bi-monthly publication to raise industry awareness and report on the activities of the Association and its members. Add Editor Kirsty Sharpe to your press list and send us your news and views on a regular basis. Features for the June issue include (member’s comments welcome):-
Anaerobic Digestion (AD) is the only renewable energy technology that can enable the UK to meet its renewable energy, landfill and climate change targets. Based on mature technology, it can be rolled out quickly and cost-effectively, generating electricity and gas that can be put into the national electricity and gas grids or compressed for use as a transport fuel. ADBA was conceived when, as energy spokesman for the Liberal Democrats, I forced the Government to accept an amendment that introduced double ROCs for biogas (see p6). It was obvious that, although there are a large number of companies working in this area, a trade association which could lobby on the subsidy levels and the myriad of other issues such as permitting, training and finance, would need to be created if Britain is to have a comprehensive AD infrastructure by 2020. ADBA was launched at Stoneleigh in September 2009 and our first annual conference (organised in just seven weeks!) was held in December 2009. Kicked off by the Defra Minister Lord Davies of Oldham, the conference was unusual in that it focused completely on anaerobic digestion, demonstrating the size the industry has already reached. ADBA, as the voice of the AD industry, has been lobbying since then on subsidy levels, Government policy, training and standards, and helping to develop the finance sector. As an association, we have strived to make a distinction between anaerobic digestion and biomass, focusing purely on the solutions that anaerobic digestion presents and the environmental and sustainability credentials the technology incorporates. AD is an industry that is about to take off and whilst many renewable technologies stumble at this point, with the support of our members we believe that we will be able to remove many of the road blocks in the coming year. Although recent problems have slowed development, over the next few years Britain will become the most active constructor of AD plants in Europe, and also the most innovative in developing new solutions for, among others, municipal waste. With such a promising future it is important we are active now. Our forthcoming trade show in July will be a chance for anyone interested in AD to get a full understanding of the industry and the direction it is moving. It will be an opportunity for all questions to be answered and actions to be agreed therefore it shouldn’t be missed! I look forward to seeing you all there.
Lord Rupert Redesdale, ADBA Chairman
• RHI consultation paper outcomes • Recent AD plant case studies • U pdate on AD training and EA permits Sponsorship & Advertising: Louise Wallace T+44 (0)844 292 0874 E louise.wallace@adbiogas.co.uk Editorial: Kirsty Sharpe T +44 (0)1920 821873 E kirsty.sharpe@adbiogas.co.uk www.adbiogas.co.uk
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AD & Biogas News | April 2010
www.adbiogas.co.uk
Events UK AD & BIOGAS 2010 The UK’s FIRST anaerobic digestion trade show! T H E A N A E R O B I C D I G E S T I O N A N D B I O G A S A S S O C IAT I O N ’ S A N N UA L E X PO & CONFERENCE
7-8 July, NEC
When the NEC (Birmingham) opens its doors to The ADBA Trade Show (7-8 July 2010) later this year, leading worldwide professionals from a wide range of industries will gather to discuss the hottest form of renewable energy - anaerobic digestion (AD) and biogas. The ADBA Trade Show is the first of its kind in the UK focusing exclusively on the AD and biogas industries. Combining an exhibition, conference and free seminar programme, this event is truly unmissable however large or small your interest in AD and biogas.
Who will be visiting?
UK AD & BIOGAS 2010
Individuals from all sectors including the waste, manufacturing, retail, agriculture, energy, and water industries should attend 7-8 July, NEC this event if they have any interest in AD. The event will be an opportunity to talk to leading suppliers, service providers and industry experts, network, access the latest industry and regulatory news, listen and debate the hottest issues in a dynamic conference and get practical and in-depth topical advice in our free seminars.
Two-day Conference
A thought provoking and insightful two day conference, led by Government Ministers and leading industry experts, will discuss progress in the industry and tackle the current issues affecting the development of this This is the first trade show dedicated exclusively nascent industry, including the size to anaerobic digestion and biogas in the UK, of the UK market, the direction the demonstrating that with the new financial industry should take, financing the incentives, the UK market is poised to take off. industry, developing on farm AD, We have people coming from around the world biomethane for injection into the and a very exciting conference planned. grid or using as a transport fuel.
Charlotte Morton, ADBA’s Chief Executive
Why attend? Whether you are exhibiting as a supplier of products and services, or a visitor looking to broaden your knowledge, this event can help you understand AD on many levels:•H ow AD plants work including: site suitability, the types and sizes of plant available, plant operation and performance •B enefits of using bioenergy crops (e.g. feedstocks) and ways to increase their efficiency •A D plant safety and operator training •F unding, planning, permitting and financial returns advice •M arket opportunities for digestate •U sing AD on farm • I njecting biomethane into the grid or using as a transport fuel
Who will be exhibiting? This show enables companies operating in the AD and biogas industries to meet buyers direct. Along with opportunities to participate in our seminar and workshop programmes, the event is an important marketing tool for companies wishing to create international contacts and sales leads. Amongst the exhibitors will be the world’s leading AD equipment suppliers, biogas operators, waste technology providers, consultants, academics, food retailers and manufacturers at the event.
“The conference, which will be attended by representatives from around the world presenting export opportunities for many of the companies, will provide a platform for companies to meet a large range of potential customers in the agricultural, local authority and commercial sectors. Although the number of plants reaching completion next year will be low, almost all those who need an AD solution, from supermarkets to farmers to local authorities to food processors, will be planning their solution now and this show will be a perfect opportunity to present your technology to the majority of the marketplace,” explains Lord Rupert Redesdale, ADBA Chairman.
Free seminar programme A series of themed AD Masterclasses and workshops will give practical advice on all aspects of the industry. Presented in a classroom style environment they will help you to learn about and discuss best practice in an informative manner.
Get involved now! >
www.adbiogas.co.uk
Exhibitor packages, conference rates, sponsorship opportunities and visitor tickets:- www.adbiogas.co.uk T+44 (0)844 292 0874 E louise.wallace@adbiogas.co.uk
April 2010 | AD & Biogas News
03
ADBA Benefits of AD
What is AD?
✔ Reducing greenhouse gas emissions ✔ Reducing our use of fossil fuels ✔ Energy security
I
n short Anaerobic Digestion (AD) is a natural process, where organic matter such as wastes from household food, gardens, food processing plants and supermarkets are converted into energy in an oxygen-free atmosphere. The main product from the AD process is biogas - a mixture of methane and carbon dioxide which when upgraded is very similar to natural gas and therefore, a soughtafter energy commodity that would otherwise be released into the atmosphere as a greenhouse gas. Biogas is suitable for energy production and can be used to generate electricity, gas or heat, or it can be compressed for use as a transport fuel. The AD process also produces liquid and solid by-products; the solid by-product is known as digestate and is a low level fertilizer and soil improver.
The role of ADBA Officially launched on 16 September 2009, the Anaerobic Digestion and Biogas Association (ADBA) was established to represent companies involved in the AD and biogas industries, and aims to remove the barriers these businesses face to grow the industry. Charlotte Morton, Chief Executive of ADBA, comments: “Our role is to represent the anaerobic digestion and biogas industries vis-a-vis Government departments and agencies. It’s a very exciting time as the industry is poised to take off, so it is vital that companies working in this industry have the backing of an association which will assist and support their needs. Our main aims are to break down the barriers affecting the industry, encourage investment in the sector, develop business opportunities for our members, ensure there is appropriate training, provide industry data, and importantly promote R&D to continually develop industry processes and technology.”
growth and potential this industry should be seeing. ADBA Director and MD of Kirk Environmental Gary Little remarks: “ADBA provides a unique insight into all the elements that allow for a successful AD project to pass through the various phases of planning and design to completion. AD is not a new process, sewage water treatment works have been successfully utilising the procedure for years, and solid controls and standards have been long established. ADBA has worked to combine the experience gained by the water treatment industry with new innovative AD process design methods, and in doing so has become a valuable source of information. They are a proactive association and provide the industry the support it needs.”
Get involved now! >
With a growing in-house team, supportive founder members and a knowledgeable board of directors (who work for member companies), ADBA stands in good stead to realise the rapid 04
AD & Biogas News | April 2010
www.adbiogas.co.uk
90 members in six months! For member benefits see p13 For further information go to www.adbiogas.co.uk
Meet the team Lord Rupert Redesdale
Charlotte Morton Chief Executive
Chairman The youngest Life Peer created thus far, Rupert was initially admitted as a Hereditary in 1991, and subsequently returned as a Life Peer in 2000 at the age of 33. His numerous positions in Parliament include Vice Chair of the All Party Parliamentary Group for Climate Change and Secretary of the APPG for Archaeology stand Rupert in good stead for ADBA lobbying activities. T +44 (0)844 292 0874 E redesdaler@parliament.uk
A former corporate lawyer with an MBA from the London Business School and an LLB in English & French Law from the London School of Economics, Charlotte is an entrepreneur with a passion for the environment. Founder of WhizzGo, the innovative pay-by-the-hour car hire business which soon became the UK’s largest national car club, she is keen to promote businesses which help combat climate change. Charlotte is determined to ensure ADBA maximises the potential of the anaerobic digestion and biogas industries. T +44 (0)844 292 0874 E charlotte.morton@adbiogas.co.uk
Louise Wallace
Sales and Marketing Manager Graduating from the University of Nottingham in 2003 with a BA in Geography, Louise headed to the Far East six months later to live and work in Beijing China, before being spotted by Charlotte (then the MD of WhizzGo) at a graduate recruitment day. Louise’s career move to join the ADBA team continues to be diverse and challenging. With the assistance of Susie and Annika, Louise oversees all marketing, PR and sales activities. T +44 (0)844 292 0874 E louise.wallace@adbiogas.co.uk
Kirsty Sharpe
AD & Biogas News Editor Always up for a challenge and with a proven track record in company management, marketing and publishing, Kirsty aims to make the ADBA newsletter an educational tool which will become the voice of the industry, and most importantly add value to the membership. Add Kirsty to your press database and keep in regular contact with your news and views. T +44 (0)1920 821873 E kirsty.sharpe@adbiogas.co.uk
Annika Herter
Marketing Executive
Annika’s international background includes studying British & American Studies and Sociology in both Germany and the UK, along with extensive work experience in the fields of Marketing, PR and Publishing in Ireland, Germany and the UK. Annika’s remit includes: member services, co-organising member events, website content management, partnership development and copy writing for advertising material. T +44 (0)844 292 0874 E annika.herter@adbiogas.co.uk
Bruce Nelson
Director of Compass Renewables Financial advisor, Compass Renewables, is the finance interface for ADBA offering constructive advice to members for projects in the conceptual stage, through to those at advanced stages of planning. Bruce and his team provide guidance on business plan requirements, debt, equity, grants and developers funds etc. T +44 (0)1732 464495 E bruce@compassbusinessfinance.co.uk
Susie Hunt
Susanne Thomas
Marketing Executive
Founding Partner of Ennismore Partners LLP
Before joining ADBA, Susie worked in the production department at TBWA Advertising Agency and previously gained valuable industry experience at two PR firms: Cobb PR in Eastbourne and CCD Public Relations, which complemented her degree in English. Susie’s remit includes working with designers for the production of the newsletter and corporate brochure, co-organising member events and managing ADBA’s press work.
Ennismore Partners LLP an asset financing firm focuses on developing and providing structured finance for infrastructure projects and balance sheet driven asset financing solutions for larger corporates. Within ADBA, Ennismore Partners aims to facilitate competitive financing for larger projects.
T +44 (0)844 292 0874 E susie.hunt@adbiogas.co.uk
For finance enquiries contact Bruce Nelson (as above in the first instance)
www.adbiogas.co.uk
April 2010 | AD & Biogas News
05
Policy Update
Government fails to support anaerobic digestion Budget update “Following considerable work and strong representation with DECC over the last two months, the Government announced in its budget statement, that it intends to grandfather support at current levels for anaerobic digestion and energy from waste with combined heat and power. Any plants accredited after the 2013 review will be grandfathered at the level of the review. This now goes to consultation and will be embedded into policy by July 2010, and should start to release funds back into the market, albeit some of the finance sector may wish to wait until July.” Bruce Nelson, Director of Compass Renewables
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AD & Biogas News | April 2010
T
he Government has accepted that the development of a biogas industry based on anaerobic digestion (AD) plants, will need subsidy. Since the introduction of double ROCs for commercial biogas production in 2008, the industry has started to expand. Two new subsidies were introduced in the 2008 Act aimed at smaller scale renewable projects, the Feed-in Tariff (FiT) and a whole new sector dealing with the issue of renewable heat, which was often ignored as almost all subsidies up to this point were based on the production of electricity. There is also the Renewable Transport Fuel Obligation (RTFOs) available for biogas used as a transport fuel. The Renewable Heat Incentive (RHI) is especially relevant to biogas as 75% of the energy consumed in most domestic buildings is heat and hot water powered by burning gas. Before the introduction of double ROCs, it was uneconomic to build an AD plant in the mainstream commercial arena. The Government has recognised that to meet the UK’s committed greenhouse gas emission, renewable energy and waste / landfill targets, the country needs a comprehensive AD infrastructure covering the whole of the country. www.adbiogas.co.uk
The Department of Energy and Climate Change (DECC) is responsible for the setting of the subsidy levels. ADBA does not believe that the current subsidy levels are correctly structured or high enough to bring about the growth in the AD sector that is needed to meet these Government targets and is lobbying the Government hard to increase the subsidy levels.
ROCs not covered by grandfathering clause Following a Parliamentary question asked on behalf of the Renewable Energy Association (REA), DECC confirmed ROCs were not grandfathered, unlike other renewable electricity generators. The answer led to most of the banks suspending finance until the issue is resolved. ADBA has met with DECC and Lord Hunt, DECC minister, several times to explain the importance of this issue and the need for it to be addressed as quickly as possible, emphasising the differences between AD and Biomass. ADBA also convened a group of financiers to work with the Department to change policy so that funding can resume. DECC is now hoping to change their internal policy to grandfather AD by July 2010 and this was confirmed in the budget.
Once the industry’s regulatory environment has been decided upon in a sensible manner, the fundamentals look positive enough to attract financing. With credit markets gradually unfreezing, available capital will be plentiful enough to fuel the ambitious growth plans for AD as a significant viable energy source. Susanne Thomas, Founder of Ennismore Partners LLP
This resolution depends on constant pressure and although the Department is acting as quickly as it legally can, further pressure will be needed to make sure the next Government of whatever colour implements this as quickly as possible.
Biogas candidate to meet Renewable Transport Fuel Obligation Whilst there has been much questioning of the value of biofuels for transport and its potential sustainability, the sustainable nature of biomethane should make it an obvious candidate for the Government to meet its Renewable Transport Fuel Obligation.
FiT level causes concern ADBA has met with DECC’s FiT team to express concern that the 9p level of FiT will not promote the building of AD plants. We are compiling data on how the FiT level has affected order books and will consider pushing for a review at the earliest possible opportunity. A number of assumptions used by DECC in its calculations were mistaken, including the price of maize feed stock for AD plants which was applied to the financial modelling produced by DECC at zero cost, while the market price is approximately
Definitions explained ROCs The Renewables Obligation (RO) obligates suppliers to source an increasing amount of energy from renewable sources, and suppliers can comply with their obligations by presenting Renewable Obligation Certificates (ROCs), making a buy-out payment, or through a combination of both. Renewable Obligation Certificates (ROCs) are tradable certificates issued by energy regulator Ofgem to an accredited generator for eligible renewable electricity generated within the United Kingdom and supplied to customers within the United Kingdom by a licensed electricity supplier. FiT The Feed-in Tariff (FiT) is the latest financial incentive scheme from the Department of Energy and Climate Change (DECC) aimed at encouraging the development of renewable energy. It is a renewable energy subsidy offering a fixed payment per kilowatt hour of renewable energy generated, varying across technologies. The current proposal guarantees a minimum payment of 5p per kWh of energy exported to the grid. RHI The Renewable Heat Incentive (RHI) is a scheme which gives cash back for clean energy generated. In order to meet the Government’s 15% renewable energy target by 2020, generating renewable energy in all sectors including heat is a top priority, and it is recognised that some form of financial assistance is needed to encourage companies and individuals to do so. The RHI scheme, which is intended to commence in April 2011, will provide financial support for those who install renewable heating (which qualifies for support under the scheme). Grandfathering A guarantee not to change support for existing projects is known as grandfathering. In terms of renewable energy, grandfathering acts as a protection for plants and facilities so that they receive a certain banding of ROC for the entire life of the project. Although the grandfathering principle applies to all renewable energy sources, pure biomass and anaerobic digestion (AD) are both excluded. If the support level isn’t guaranteed by grandfathering, investors are less likely to commit to new projects. RTFO The Renewable Transport Fuel Obligation (RTFO) requires fuel suppliers to ensure that a fixed amount of fuels they supply is from renewable sources. This is observed by the Renewable Fuels Agency (RFA) which demands fuel suppliers submit reports on the sustainability and carbon emissions of the fuels they supply. Fuel suppliers have to purchase RTFO certificates from renewable fuel producers in order to prove that they meet their set renewable fuel targets. For more information: www.decc.gov.uk
£25/tonne, resulting in an additional operational cost of £100,000-£500,000 to a typical on-farm AD plant business. Rob Heap, General Manager of UTS Biogas Ltd and one of ADBA’s founder members, commented: “As a result of this decision, it now appears likely that between 60% and 80% of farm-based www.adbiogas.co.uk
plants that were being developed in anticipation of a robust Feed-in Tariff will not now be developed. UTS have been developing AD projects for farmers all over the country to support the smaller and medium sized farms and especially those with livestock Continued > April 2010 | AD & Biogas News
07
Policy Update Continued >
The Finance perspective... The finance world has been thoroughly disappointed with ROCs and FiT, to the point where several leading debt and equity players have either suspended their involvement, or withdrawn from the market altogether. This has affected funds totalling somewhere around half a billion pounds which in these early days of AD has been catastrophic. One of the major areas for consideration when putting together a financial plan will be security and level of revenue streams. To date with no grandfathering of ROCs, and FiT too low, Government has failed to generate the attention required from the finance sector, and has massively underestimated the impact this has had on the progress of plants in the pipeline, many of which will fail and lose their investment. Also, AD projects at the conceptual stage will never proceed, as considerable investment is required to prepare a project to a point it can be presented for underwriting. On current form, the UK will seriously under-deliver on the biogas element of its 2020 targets. Bruce Nelson, Director of Compass Renewables In order to achieve an average of 2tCO2 (tons of carbon dioxide) per head by 2050, expenditure on renewable energy would need to increase to USD 230bn by 2020 and USD 500bn by 2030. This is significantly above the current policy target from countries around the world of USD 200bn annually by 2030. “...in spite of the ongoing economic malaise, investment in renewable energy should continue to grow, driven heavily by existing government targets. And if governments take the threat of climate seriously there will be an increasing role for renewable energy up to 2030.” Guy Turner, Director of Carbon Market Research at Bloomberg New Energy Finance.
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AD & Biogas News | April 2010
enterprises. AD technology at this small scale is environmentally very attractive, but it needs financial support to secure commercial funding for the high level capital investment. We have taken many calls since the FiT announcement from farmers who are now placing their project plans for AD in the pending file.”
ADBA lobbies RHI to increase 100% ADBA has also met DECC’s RHI team to question the 4p level for RHI. This level was introduced to reflect parity with FiT. ADBA has stated that an RHI level of 8p, with an additional 2p to cover the cost of grid injection, would be needed to get AD plants built and the real costs reflected to make gas injection a reality. “It is essential for many reasons, not least to address energy security and climate change issues, that the RHI achieves its objective of encouraging investment in the production of biomethane. ADBA’s policy working group, chaired by Dorian Harrison, is working with DECC’s RHI team to review DECC’s assumptions and demonstrate why a higher RHI is needed to achieve this,” says ADBA Chief Executive Charlotte Morton. “ADBA is working with DECC to ensure that the level of RHI for biomethane is reviewed upwards from the current proposed 4p/kW to a level that will re-invigorate the AD market. ADBA has proposed an initial level of support for biomethane of 8p/kW + 2p/kW for grid conditioning and connection, to be reduced once a base level of generation is achieved,” adds Dorian Harrison, ADBA Director and Technical Director of Monsal.
What’s your view? The Department of Energy and Climate Change (DECC) is asking for formal responses on the RHI consultation paper by 26 April 2010: www.decc.gov.uk/en/content/cms/ consultations/rhi/rhi.aspx All ADBA members should forward their views to Dorian Harrison: DHarrison@monsal.co.uk
www.adbiogas.co.uk
What needs to happen? Bruce Nelson, Director of Compass Renewables, gives us his view: > Grandfathering for ROCs, as announced in the budget statement, needs to successfully complete its progress through the consultation period (approximately 12 weeks) to become policy at some point this summer. > Review FIT through an emergency measure and increase in line with what the Government said they were minded to set during their consultation. This though is probably not going to happen, so we are stuck with the current levels for the next couple of years. > DECC needs to get the level of RHI correct, enthusing the developers, and allowing the funders to drive the desperately needed investment into the sector. The current suggestion of 4p won’t even get the funders to first base - 8p may, that’s if the grid connection is not paid by the producer. To achieve the appropriate level, DECC must listen carefully to informed advice from all areas of AD, ensuring the assumptions they use in their modelling reflect reality. “You can see just how important it is for the Government to get RHI correct, as their record in this area isn’t good and yet it’s of such great importance to the country. We will have lost 8 months over the grandfathering issue by the time policy is confirmed in July, and even if RHI comes in at the right level it will be another 4/6 months before we get back (from a finance perspective) to where we were in December last year! But at least we’d be heading in the right direction again,” remarks Bruce.
Next issue > Following on this story and highlighting the outcomes to RHI consultation paper at the end of April, we ask members to share their views, contact the Editor E: kirsty.sharpe@adbiogas.co.uk
Coming up in the June issue of AD & Biogas News... • WRAP launches new biofertiliser quality measures
WRAP discusses the BSI PAS 110, a new voluntary national quality specification for biofertiliser. T H E A N A E R O BIC DIGESTION AND BIOGAS ASSOCIAT I ON’S ANNUAL EXPO & CONFERENCE
UK AD & BIOGAS 2010 7-8 July, NEC
• The Anaerobic Digestion and Biogas Association’s Annual Expo & Conference
See our June issue for the full conference & seminar programme and an update on who will be exhibiting at the UK’s only AD & biogas trade show! For exhibitor package details and visitor tickets contact 7-8 July, NEC louise.wallace@adbiogas.co.uk
UK AD & BIOGAS 2010
• Members’ news and views
We would like members to share their news and views on the AD & biogas industry including: regulatory issues, recent AD plant case studies, new technology, finance/funding etc. Submit your articles and recent press releases to Editor kirsty.sharpe@adbiogas.co.uk by 30 April.
www.adbiogas.co.uk
April 2010 | AD & Biogas News
09
Regulatory Review
Impact of the new EA permit on AD competence and training The development of Anaerobic Digestion (AD) in the UK brings with it many opportunities as well as the complications associated with a developing market sector. The opportunities arise through a number of enabling forces, for example, renewable credits for green energy generation, landfill taxation, and diversion targets imposed on waste producers. The complications which arise within this new emerging market include the lack of tacit operating knowledge and operating competence across a range of sectors which are in the process of establishing AD processing capacity. “Building a safe industry, which has always been a priority for ADBA, depends on those involved getting appropriate and relevant training,” comments ADBA Chief Executive Charlotte Morton. “Much of the training and qualifications the industry needs already exists so we need to identify any gaps and facilitate the development of training programmes to meet the competence standards required by current and future legislation and health and safety and operating practices to maintain the environmental integrity of the AD facility and its outputs. We are working with the Environment Agency, Defra, HSE, WRAP, WAMITAB and CIWM to this end,” adds Charlotte. The key aims of the training provision should be to:•E nable the ability of sector operators to incorporate new technologies • I mprove renewable outputs through increased plant optimisation • I mprove site supervisory and operating skills •D evelop safety awareness and de-risk site operations • I ncrease understanding and awareness of legislative and environmental compliance •D evelop individual employee competencies •E nable employees meet new responsibilities • I ncrease job satisfaction, morale and motivation among employees •E nhance company image • I mprove customer experience
EA Permits In England and Wales, under the Environmental Permitting Regulations 2007, which are to be replaced by the Environmental Permitting Regulations 2010 on 6 April, anyone undertaking a waste operation i.e. AD, will need an Environmental Permit (previously known as a waste management licence) unless one of the following exemptions apply:10
AD & Biogas News | April 2010
Exemption T24 – AD at premises used for agriculture and burning of resultant biogas – this covers plant tissue waste and horse/ farmyard manure (slurry only). The activity is only exempt from needing a permit so long as all the specified criteria are met, which includes the total quantity of waste treated, or stored at any one time not exceeding 1,250 cubic metres. Exemption T25 – AD at premises not used for agriculture and burning of resultant biogas – this one has a wider range of wastes that can be used but the total quantity of waste treated or stored at any one time is restricted to less than 50 cubic metres (other criteria also apply). Any AD activity outside of these exemptions will need to have an environmental permit. Those wanting to operate as an exempt facility will need to register with the Environment Agency, and for organisations which registered exempt under the ‘old’ exemptions (prior to the 6 April 2010 regulations) but now need a permit (after 6 April), there are transitional arrangements to help take these organisations through the permitting process.
Training Schemes Applications for new permits, transfers, and in some cases variations will need to be supported by evidence of technical competence in accordance with one of two schemes currently available: a Vocational Qualifications-based scheme run by the Waste Management Industry Training & Advisory Board (WAMITAB) and CIWM, and a Corporate Management Scheme run by ESA/EU Skills. ADBA has reviewed the new schemes (which
www.adbiogas.co.uk
Building a safe industry, which has always been a priority for ADBA, depends on those involved getting appropriate and relevant training Charlotte Morton, ADBA Chief Executive
now replace the statutory system of Certificates of Technical competence (CoTCs) and Environment Agency assessment) and concluded that the WAMITAB/CIWM operator competencybased scheme is the most appropriate to use as a base for AD training. Terry Brownhill, ADBA Training and Safety Working Group chair, comments on how ADBA reached this decision: “The waste industry operators, which could potentially operate a high percentage of the larger AD facilities, already understand and process personnel through the WAMITAB/CIWM competence scheme assessed units relative to their waste permitting requirements. It would be time-consuming and unreasonable to develop and impose alternative methods in parallel to the existing system which could disadvantage personnel who have already achieved some of the common units which could count towards attaining their AD competence accreditation. For example, a candidate who holds the WAMITAB Environmental and Health & Safety units can use these to count towards the technical competence requirements.” WAMITAB is the qualification-awarding body which accredits individuals via one of their 60 centres nationwide, and works in conjunction with CIWM (Chartered Institution of Waste Management), the professional body which provides guidance and advice to individuals and organisations working within the
Monsal team training at an AD plant in Cambridge. waste and resource management industry. Within Scotland and Northern Ireland, if a waste management licence is required, at present you will need to demonstrate technical competence through a CoTC from WAMITAB. Dr Lawrence Strong, Director General of WAMITAB, explains their involvement: “In addition to the flexibility that the CIWM/ WAMITAB competence scheme brings, an exciting new aspect is the introduction of ‘continuing competence’, which addresses how an individual maintains their competence over time. For the very first time any individual within the scheme will be able to demonstrate to the regulator (and the public at large) that they have kept their initial level(s) of competence up-to-date. This is a significant step forward as the industry continues to professionalise its image and performance.” Whether or not there is a requirement to provide training to support the development of technical competencies, there remains a wider requirement to ensure that all staff have access to general training covering both technical and non-technical subject areas relative to the operation of the AD facility. “We have an opportunity to ensure that the identification of the specific AD training needs at all levels should reflect and support the new National Occupational Standards and vocational qualifications which have recently been reviewed and accredited for different aspects of biological treatment. This will enable the industry and training providers to ensure that appropriate training and qualifications are available to professionalise the industry, maintain standards and improve health and safety practices,” said Claire Poole, Education and Training Manager of CIWM.
For more information: www.wamitab.org.uk www.environment-agency.gov.uk www.ciwm.co.uk www.adbiogas.co.uk
www.adbiogas.co.uk
April 2010 | AD & Biogas News
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Advertorial
Where does AD sit in the energy mix? By Michael Abbott, Managing Director of Inenco
N
ow that the dust has settled on the last budget of this parliament and the Government has set out its strategic approach to the future of energy supply, the time is right to consider the implications for anaerobic digestion (AD) and biogas. There appears to be a growing recognition in Government of the massive scale of delivering sufficient supplies of low carbon energy, not just to close the generation gap but also in working towards the 2050 targets. The Energy Markets Assessment describes the need for an unprecedented level of investment especially in relation to electricity and the signals about how this will be achieved show that large scale centralised generation, is at the core of the strategy. At the same time, issues in the way that embedded generation is being supported are slowing down the rollout of capacity. The new Green Investment Bank (GIB) was one of the centrepieces of the budget. The GIB is, however, in comparison with commercial investment banks a very modest affair with capitalisation of £2 billion - the idea of course is that funding from the GIB will draw in much larger sums from venture capital funds and institutional investors. Critical announcements relating to the GIB, were about the targets for its funding and the fact that equity finance would form a major part of the investment. The targets mentioned were offshore wind farms and low carbon 12
AD & Biogas News | April 2010
transport, which are clearly only within the reach of existing major organisations, the generation companies and the car industry, yet there seems to be little scope to support projects on the scale of AD and biogas. At the same time, even if smaller projects were the focus, the financing model doesn’t match the needs of project developers. There are reasonable amounts of equity finance available but it is debt finance that is really required. The announcements about increased business bank lending should have offered some cheer, but this is where the problem with banded ROCs is creating barriers; the arrival of double ROCs for AD set the expectations for a wave of development. Payback models that were too lengthy with single ROCs were set to be transformed when the banding came into force, but still investment is too slow. The uncertainty about the long term stability of the subsidy and the grandfathering of ROCs, has wiped out the benefit of the banding. So, the £94 billion of additional lending the Chancellor announced is unlikely to benefit AD projects because the banks are discounting the double ROCs from business models. The picture is clouded further by disappointment in the levels of support offered by the Feed-in Tariff (FiT) and the initial details of the new Renewable Heat Incentive (RHI). Questions have been raised about whether energy farming would meet the sustainability requirement www.adbiogas.co.uk
of the RHI - the general reaction to the FiT is that the tariffs are too low to support projects of the scale of most AD plants. These issues beg the question, how important is embedded generation within the Government’s long term energy strategy? It would appear that this strategy could be described as an “all electric” model, seeing the vast majority of energy delivered as electricity and transforming the models for heat and transport. This is why the Energy Markets Assessment sees the need for such huge increases in generation capacity. The only realistic approach to delivering this capacity is through the existing centralised model and this would put AD on the margins. It’s easy to see that this model would be attractive to Government; whilst the development costs are huge, the existing model of generation and supply are retained, as is a high degree of centralised control. Moving forward, we need to demonstrate that embedded generation creates additional benefits in terms of infrastructure investment and community engagement so that AD can play a proper role within our future energy mix.
For more information: www.inenco.com
Membership Matters Rapid growth demonstrates industry demand energy or operate large fleets of commercial vehicles including farmers and landowners, supermarkets, food processors, local authorities, all of whom have to manage organic waste or provide green energy. Ninety members in six months is a huge achievement, but our intention is to grow the membership to several hundred over the next couple of years,” adds Charlotte.
Membership benefits
S
ince its conception, the Association has been clear about its membership objective to improve the performance of and add value to members’ businesses. Operating for only six months, ADBA has rapidly grown to ninety members already. “Attracting the number and range of members of all sizes that we have done in such a short time demonstrates the need for a trade association specifically to represent the anaerobic digestion and biogas industries,” enthuses ADBA Chief Executive Charlotte Morton. “Our members include a wide range of companies large and small from a number of industries including: utility companies, plant builders, plant operators, training providers, consultants, local authorities, financiers and even accountants and lawyers. AD affects all businesses which produce or manage organic waste, generate
ADBA works hard, either directly or through a third party, to provide a wide-range of different services to meet the needs of its diverse membership base including:Technical guidance and support We provide assistance on such things as responding to general technical queries, AD site scoping, plant planning and feasibility studies, AD training and conferences.
ADBA’s diverse membership includes:Utility companies:
British Gas, Scottish and Southern Energy, United Utilities, Ecotricity Plant builders:
A-Consult, Clarke Energy, Edina, Galglass, Kirk Environmental, Landia, Monsal, Xergi Farmers:
JL Blackwood Plant operators:
Envar, Future Biogas, Renewable Zukunft Training providers:
Reaseheath College, Aqua Enviros, Greenwatt Consultants:
Entec, Inenco, Wardell Armstrong, Hyder Consulting Local authorities:
Milton Keynes Council Waste management companies:
Veolia Financiers:
Cooperative Bank Government agencies:
WRAP
Industry data and information To help members further their knowledge we supply weekly news alerts, industry papers/reports, updates on legislative changes, and progress on AD plants in the UK.
Finance In a growing industry currently without a funding infrastructure, members will benefit from our links to funders and assistance with financial modelling.
Sales and marketing opportunities To raise the profile and awareness of member companies, a number of unique opportunities only available from ADBA, have been created for members including: a membership directory, online advertising, newsletter advertising, circulation of tenders, annual trade show & conference, members meetings, networking events and member forums. See page 3 for information on the UK’s first AD & biogas exhibition!
The voice of the industry Working on behalf of its members to raise the status of anaerobic digestion in the renewable energy sector, ADBA actively works with all relevant Government departments and agencies to assist them to understand the issues affecting the sector and propose workable solutions, it sets production targets (locally, regionally and nationally), and through its Working Groups (see p14), is working to develop appropriate industry regulation, training and standards.
“AD is a key component of AMEC Global Renewables’ UR-3R Process™ which is being used in the Lancashire Waste Private Finance Initiative (PFI) project, a £2bn 25-year agreement to process the household waste of 1.4m people and one of the largest waste PFIs ever signed in the UK. The Association’s established political and industry networks have been particularly helpful in providing quality guidance and support on recent legislative issues that have affected the industry.”
Find out More > If you want to get the most from your membership, call us now to find out how: T +44 (0)844 292 0874 or go to www.adbiogas.co.uk
Darryn Quayle, Business Development Executive of AMEC Global Renewables UK Limited www.adbiogas.co.uk
April 2010 | AD & Biogas News
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Membership Matters
Working to develop a secure marketplace
F
ive ADBA special interest working groups have been established to draw-out and tackle key issues which are fundamental to the growth and security of the industry. Each run by leading professionals and experts in their field, the working groups consist of members and where appropriate, representatives from EA, HSE, Defra, DECC and WRAP to maximise the understanding between these Government departments / agencies and the industry. Recognising this as an opportunity to communicate, learn, and strategise for the benefit of the industry and individual businesses, members wishing to participate are asked to contact the Chair of each group.
“The rapidly developing anaerobic digestion industry in the UK needs representation at the highest level to enable the industry to influence the legislation and incentives that will drive and control the establishment of the technology. This will help to ensure that anaerobic digestion can be developed to the scale, and within the time-frame, required by the Government and the environment. ADBA is ideally placed to exercise this influence and we are delighted to be members.”
Planning and Permitting Aerial emissions, odour, traffic and visual impact are all issues that affect both the planning and in some circumstances the permitting of new AD facilities. The new standard rules permits are soon to be implemented, and a key objective of the group will be to look at the best way of educating planning offices and members of planning committees. Topics of interest to the group include: permitted development rights, environmental appraisals and statements, permitting exemptions, the new standard rules permit, and bespoke permit applications. At the group’s inaugural meeting (late March) the issue of grid connection was raised in relation to the difficulty of obtaining information and quotes, and the significant variation in the costs. Ofgem offered to discuss the issues with the Distribution Network Operators (DNOs) and asked that our members provide clear examples of the difficulties they are experiencing; please email susie.hunt@adbiogas.co.uk. Chair Mark Bedford, Wardell Armstrong T +44 (0)845 111 7777 E mbedford@wardell-armstrong.com
Dr. Nush Mohabuth, Technical Manager, Envar Ltd.
Water
Policy The ADBA Policy Working Group is a collection of industry experts and representatives with a common interest in UK legislation and policy affecting the development, construction and operation of anaerobic digestion plants. The group has two primary functions; firstly, to feed back into ADBA members concerns and thoughts on market influences, and secondly to lobby and influence new and existing government policy. In addition to its duties within the Association, the policy group aims to provide a vehicle for individuals to network and discuss issues of mutual interest with fellow professionals. Chair Dorian Harrison, Monsal T +44 (0)1623 412108 E dharrison@monsal.co.uk
Chair Patrick Pierrepont, Hyder Consulting T +44 (0)1453 731231 / +44 (0)7809 594523 E patrick.pierrepont@hyderconsulting.com
Agriculture
In order to address the lack of skills and operating experience in this sector, the working group is in the process of identifying and matching training requirements to meet the competence standards required by current and future legislation, health and safety, and operating practices to maintain the environmental integrity of the AD facility and its outputs.
The ADBA Agriculture Working Group (AWG) has been set up to provide a forum to highlight, discuss and ultimately look for ways to solve some of the issues and bottlenecks facing farm based plants. With input from members, there are a number of common themes emerging including: the planning application process, grid connection, environmental permitting, disposal of digestate, and economic viability of smaller on-farm AD plants. Many of these themes are common to the other working groups, so we intend to share information across the Groups where appropriate.
Chair Terry Brownhill, Entec T + 44(0)1606 354816 E terry.brownhill@entecuk.co.uk
Chair Greg Hilton, Bidwells T +44 (0)1223 841841 E Greg.Hilton@bidwells.co.uk
Training and Safety
14
Working as a forum for members to raise and discuss the impact of AD on the water industry, the group (which will include experts and stakeholders) will provide members with up to date regulatory and legislative developments, and aims to influence key stakeholders directly and via the consultation process when the opportunity arises. Topics of interests including OFWAT and current regulations will be discussed along with the group’s objectives at the inaugural meeting in April.
AD & Biogas News | April 2010
www.adbiogas.co.uk
Membership Matters
Thank you founder members!
W
ith the drive and passion of Chairman Lord Rupert Redesdale and assistance from nine founder members, ADBA officially launched on the 16 September 2009 as the UK trade association for the anaerobic digestion (AD) and biogas industries. This group of determined companies and individuals together recognised the importance of AD in providing a renewable energy source that could meet the needs of the country and the needs it has under climate change. Without their expertise, enthusiasm to drive the industry, and continued support, The Anaerobic Digestion and Biogas Association would not exist... which is why we’d like to take this opportunity to say thank you!
Michael Abbott Managing Director of Inenco, a leading consultancy specialising in energy management, sustainability and environmental services.
www.inenco.com
Jason Parker UK & Eire Manager of A-Consult Ltd, a designer, manufacturer and installer of precast concrete anaerobic digesters and storage tanks.
Dorian Harrison
www.aconsult.co.uk
Director of ADBA and Technical Director of Monsal, an established process and technology business with over 220 AD systems installed in the last 14 years.
Dave Auty Associate Director of Entec, a leading UK environmental and engineering consultancy firm.
www.monsal.com
Hugh Vaughan
www.entecuk.co.uk
Ian Farr
Director of ADBA and UK & Eire Director of Landia (UK) Ltd, a manufacturer of tailor-made pump and mixer solutions for anaerobic / biogas applications.
Sales and Technical Support for Edina, a supplier of biogas and landfill gas fuelled generation sets along with natural gas and diesel sets.
www.landia.co.uk
Gary Little
www.edinauk.com
Alex Marshall
Director of ADBA and MD of Kirk Environmental Ltd, a manufacturer of large AD tanks and BiodomeÂŽ double membrane biogas holders.
hartered Environmentalist for Clarke Energy, a supplier C of equipment, design, construction and commissioning, for a wide range of gas powered generation, gas engineering and waste gas to energy solutions.
www.kirk-environmental.com www.clarke-energy.co.uk
Rob Heap General Manager of UTS Biogas Ltd, a leading biogas company with 1,500 equipped biogas plants and almost 90 full turnkey plants.
www.uts-biogas.co.uk
www.adbiogas.co.uk
Greg Hilton Partner and Head of Renewable Energy at Bidwells, property and land management consultants. www.bidwells.co.uk
April 2010 | AD & Biogas News
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