Mapping the state of play of biomethane in Europe
The EBA has participated in a research on the state of play of the biomethane market in Europe. The report provides a general European overview, together with an in-depth mapping at country level of 23 European countries covered by the REGATRACE project[i].
The study shows that the countries with the biggest production of biomethane are Germany (10,018 GWh in 2018), United Kingdom (3,300 GWh in 2018), the Netherlands (2,226 GWh in 2018), Denmark (1,425 GWh in 2017), Sweden (1,281 GWh in 2018) and France (1,207 GWh). The production and consumption of biomethane is well-balanced in most Member States. Denmark and Germany produce more biomethane than they consume, and the excess of production is exported or stored. In Sweden, the consumption of biomethane doubles its production. This can be explained because Swedish incentives are focused on the consumption side, whereas most Member states tend to subsidize the production or injection of biomethane.
The implementation of adequate support measures is essential for the further development of biomethane. The value and duration of operational support for biomethane differs largely between the different countries and regions. When it comes to the type of support, 65 % of renewable gas producers have a preference for the application of Feed-in Tariffs. Many countries report the upgrade to biomethane as an interesting alternative for existing biogas plants, as it can help decarbonize the natural gas grid. This reasoning is introducing a shift from subsidies for biogas towards subsidies for biomethane. However, still two important biomethane countries (Austria and Germany) focus their subsidy scheme for biomethane on electricity production only and other end-uses are only supported to a minor extent.
End-use pathways for biomethane are quite clearly defined and regulated in some countries. In Sweden and Italy, the main end-use application is transport, whereas in the United Kingdom is heating & cooling. Most of Sweden’s biomethane is used in the transport sector due to a favourable support system. In Italy, the use of biomethane in the transport sector is facilitated by the already existing infrastructure and methane vehicles fleet. In 2014, the Italian government introduced the first obligation for the use of biofuels in the transport sector. In Germany, most biomethane is used for electricity production in CHP units. The usage of biomethane as transport fuel is indirectly supported in Germany through its inclusion into the list of fuels accepted for the reduction of GHG footprint for fuel distributing companies.
The cross-border trade of biomethane is still limited. Awaiting European harmonization, bilateral and multilateral cooperation are set-up to transfer minimal volumes of biomethane cross-border. Issuing bodies for end consumer disclosure (so called GoOs) according to RED II Article 19 are slowly being established in European Member States.
The study also examines consumer readiness to pay for biomethane. A choice experiment has allowed to monetize individual aspects or characteristics of the renewable gas and predict consumer preferences. The experiment shows that GHG emission reductions compared to natural gas are the aspect of the renewable gas which has the highest impact on consumers choice (29%), followed by additional cost compared to natural gas (27%), origin of the renewable gas (17%) and reliable delivery of the renewable gas (14%). The type of feedstock (9%) and the length of the contract (4%) play only minor roles in the decision-making process.
About REGATRACE: REGATRACE (Renewable GAs TRAde Centre in Europe) aims to create an efficient trade system based on issuing and trading biomethane/renewable gases Guarantees of Origin (GoO). This will strongly contribute to the uptake of the European common biomethane market. It will be achieved by setting up a European biomethane/renewable gases GoO system, by setting up national GoO issuing bodies, by integrating GoO from different renewable gas technologies with electric and hydrogen GoO systems, through integrated assessment and sustainable feedstock mobilisation strategies and technology synergies, through support for biomethane market uptake, and by transferring the results beyond the project’s countries.
[i] Belgium, Spain, Ireland, Italy, Lithuania, Poland and Romania, Croatia, Czech Republic, Greece, Latvia, Ukraine, Sweden and Slovenia, Austria, Switzerland, Germany, Denmark, France, Estonia, Finland, the Netherlands and United Kingdom.