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New UK Government RHI Scheme and the Future of Biomethane

What UK Government RHI Scheme subsidy policy becomes, after the anticipated further changes to be made in 2017, is a hot topic for the UK AD plant industry.

The future of anaerobic digestion is seen by many as being crucial to the continuation of AD Plant schemes across the nation. It comes at a time when the added advantages of production biomethane are being better appreciated, and uptake of the process to produce CNG (Compressed Renewable Natural Gas) is rising fast, so the RHI Scheme will be central to most decisions whether to proceed with biomethane producing AD projects.

There has been much talk of the UK anaerobic digestion industry being halted in its tracks due to the rapidity, and unpredictability of UK government’s recent renewable energy subsidy removals. There was therefore, much nervousness about big further cuts in the RHI Scheme.

However, the results of the UK wide consultation process which went ahead this year (2016) have now been published, and in some areas there is room for cautious optimism that a reasonable scheme which is both supportive of the AD and biomethane sectors, and of the sustainable use of biomass, may emerge.

biomethane RHI support will foster the development of plants like this one in France.

UK Support for biomethane RHI will foster the development of plants like this one in France. – CC BY-NC by Observatoire Régional Energie-Climat-Air PACA

The UK government has published a response to the consultation on reforms to the RHI. These reforms will [the UK government believes] ensure that the scheme:

  • focuses on long-term decarbonisation: promoting the deployment of the right technologies for the right uses, while ensuring the RHI contributes to both our decarbonisation targets and to the UK’s renewable energy target
  • offers better value for money and protects consumers: improving how costs are controlled, giving consumers more confidence in the performance of particular technologies and addressing potential loopholes in the scheme
  • supports supply chain growth and challenges the market to deliver: driving cost reductions and innovation to help build growing markets that provide quality to consumers and are sustainable without Government support in future. via Gov.uk/the-renewable-heat-incentive-a-reformed-and-refocused-scheme

Government’s Reform To Heat Decarbonisation Is A Positive Step Forward

The REA’s analysis of the Government’s finalised scheme, released today, indicates that the reformed Renewable Heat Incentive moves us closer to the UK meeting it’s legally binding 2020 renewable heat target. However, there will be certain key sectors which will struggle, including biogas and non-domestic biomass boilers.

Dr. Nina Skorupska CBE, Chief Executive at the Renewable Energy Association said:

“The reforms made today to the Renewable Heat Incentive are an improvement to the earlier consultation and will go some way to grow an effective renewable heat sector in some cases to 2021. As recognised in this consultation response, heat is a very complex issue and we need all technologies on board to achieve our long-term goals. Renewable gas, biomass boilers, solar thermal, heat pumps, heat networks, hydrogen and other technologies will all have a role to play.

“The next step is for Government to lay out a long-term energy strategy so industry can prepare for low-carbon heat deployment in the 2020’s and 2030’s. As of now, this policy only takes us to 2021 and there is little indication of the Government’s vision beyond.”

John Baldwin, Chair of the Renewable Energy Association’s biogas group and Managing Director of CNG Fuels said:

“The biomethane tariff reset is most welcome. Government has acknowledged the strategic role biomethane can play across heat and transport and the resetting of the biomethane tariffs should enable continued deployment of the most competitive projects.

“Unfortunately, the biogas combustion tariff isn’t likely to enable many new biogas CHP projects to come forward. With the closure of the RO, and rapidly falling tariffs for the Feed-In Tariff, this sector still faces many challenges.” via Blueandgreentomorrow.com/decarbonisationstep-forward/

So, this means that it is likely that the future UK anaerobic digestion subsidies will only be sufficient to allow the survival of the MOST COMPETITIVE projects.  Clearly these projects exist, and one which has been announced to be going ahead, even before the new RHI Scheme has been published is the AD Facility described below:

Future of Biomethane – Brigg Lane Biogas appoints Xergi to develop new biogas plant

Danish biogas plants developer Xergi has been appointed by UK-based company Brigg Lane Biogas to construct a new plant in North Lincolnshire.

Located in Bonby, the company will convert 75,000t of food waste into seven million m³ of biomethane every year. Green gas produced at the new biogas plant will be distributed through the local grid.

With the completion of the order, Xergi will have constructed its tenth plant in the UK. Xergi’s chief executive officer (CEO) Jørgen Ballermann said: “The project for Brigg Lane Biogas is our tenth delivery in the UK.

“Once the plant has been built, we will have supplied a total biogas capacity equivalent to 26MWe in the UK, a figure that we are extremely proud of.” via Power-technology.com-xergi-to-develop-new-biogas-plant-in-uk

UK renewable energy sector gives thumbs up to RHI reform

The UK renewable energy industry has reacted positively to the government’s renewable heat incentive (RHI) scheme plans.

Changes to the scheme were proposed in a public consultation in March. At that time, the renewable heat industry was deeply concerned that the revised tariffs would result in a steep fall in the deployment of many renewable heat technologies. Proposed tariff reductions of 45% for parts of the biomass heat sector, for example, were projected by the Government to lead to a 98% drop in installations.

Other technologies, such as solar thermal, were to be removed from the RHI altogether. The proposals resulted in significant outcry from sectors of the renewables industry.

The REA’s analysis of the Government’s finalised scheme, released last week, indicates that the reformed Renewable Heat Incentive moves the UK closer to meeting its legally binding 2020 renewable heat target. However, there will be certain key sectors which may struggle, including biogas and non-domestic biomass boilers.

ADBA chief executive Charlotte Morton said: “It’s great to see that the new ministers in the Department for Business, Energy and Industrial Strategy (BEIS) remain committed to decarbonising heat in the UK and continuing to support the UK’s burgeoning green gas industry.

“We are pleased to see that tariff levels have been reset – this should support higher levels of deployment. We do not believe, however, that the restrictions on feedstock for new plants, which could have unintended consequences, are justified.

“The introduction of tariff guarantees is extremely welcome and we will continue to work with the UK Government and with our members to ensure the UK AD industry keeps growing and reaches its full potential – for example by calling for urgent action on food waste collections in England.

Biomethane and biogas have been real success stories from the RHI, and the continuation of this scheme will allow the UK AD industry to build upon its success to date, decarbonising heat without any changes for the consumer.”

Summary of the New UK Government RHI Scheme and the Future of Biomethane

So, to emphasise the important role which it appears that in future anearobic digestion processes and biomethane will hold within the overall RHI, we have produced the list of supported tecnhologies provided on other websites, with the references to biomas energy and biomethane highlighted, as follows:

Key elements of the Updated Renewable Heat Incentive Scheme (RHI) will include:

• Continued support for solar thermal in both the domestic and non-domestic RHI

• Increased tariffs for new heat pumps

• Biomass remains a key part for the scheme and will continue to be supported with increased support for large and industrial projects

• Introduction of tariff guarantees will be introduced for large biomass boilers; large biogas plant; ground source heat pumps; and all capacities of biomethane; biomass-CHP and deep geothermal plant. via Renewableenergyinstaller.co.uk-details-of-rhi-reform

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6 Responses to New UK Government RHI Scheme and the Future of Biomethane

  1. Richard Wells March 4, 2017 at 10:20 pm #

    Payments are made for 7 years and are based on the amount of renewable heat made by your heating system.

  2. Frank Rodriguez March 15, 2017 at 5:24 pm #

    Reforming how we use energy for heating is critical to achieving secure, affordable and clean energy for families and businesses across the country. That is why the government will be pushing a more cost effective, targeted Renewable Heat Incentive scheme for the next five years.

  3. C Nub October 5, 2017 at 1:34 pm #

    Delighted to read:

    “The rising of the obligation for renewable-sourced fuels to 12.4% by 2032 goes beyond what was originally consulted on and will create a positive investment environment for renewable fuels. As a low-carbon, low-cost, and technology-ready transport fuel that can deliver £2.1 bn in CO2e savings per year and dramatically improve air quality, biomethane is perfectly positioned to play a leading role in helping fuel suppliers to meet these increased targets.”

    This RTFO news represents a huge opportunity for biogas and purified biomethane. But, what happened to the RHI? Wasn’t an announcement about that subsidy due to be given way back in May?

  4. Clifton G October 5, 2017 at 6:24 pm #

    Biomethane, I mean purified biogas, made to a high quality and grid-injectable is going to be huge. Trust me and invest. Look just at the coming demand which will be a reality in a few years, for biomethane. Biomethane supplies will be needed not only for transport fuel, but to provide the electric overnight, because solar panels if you noticed don’t get a whole lot ‘o’ sunshine at night!

  5. Jason Flak October 6, 2017 at 12:20 am #

    You can find out about the Green Gas Certification scheme which tracks the Biomethane making the Biomethane supplied traceable and ‘green’. http://www.barrowgreengas.co.uk

  6. Andrei K. October 10, 2017 at 9:48 pm #

    Can’t start too soon. The government has behaved so erratically recently. Can we assume this new scheme will go ahead, or should we be setting aside contingency funding in case no decision is made?

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