Benefits and challenges of biomethane production in Sweden

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1 Benefits and challenges of biomethane production in Sweden Dr. Jonas Dahl, Energiforsk Swedish Energy Research Centre DENA European Biomethane conference Berlin 12 Oktober 2015

2 Energiforsk Swedish Energy Research Centre (new organization since 1 Jan 2015) Owners : Swedish electric power association (30%) - Svensk Energi AB Swedish Power grid owner (20 %) - Svenska Kraftnät Swedish district heating association (20 %) - Svensk Fjärrvärme AB Swedish gas association (15 %) - Energigas Sverige The Swedish TSO (15 %) - Swedegas AB

3 Energiforsk in short Office in Stockholm and Malmö, Sweden 21 employees, annual turn-over (2015) 23 MEUR Core business: To develop new knowledge and financing opportunities for developing energy R&D that leads to a more sustainable and efficient future energy system

4 Energy usage in Sweden Energy use (2012) 377 TWh Transports 92 % fossil fuels Source: Energiläget 2014, Swedish Energy Agency Biomethane mainly for transport and not for power generation

5 Swedish visions and goals Fossil independent transport by 2030, Fossil free vehicle fleet and a carbon neutral energy production and usage in 2050, - Decrease needs for transports - More energy efficient vehicles - Increase propor on of electricity and bio-fuels

6 Swedish visions and goals The Swedish Gas Industry s visions are: % biomethane in the vehicle gas in % biomethane in the gas grid in 2050 Biomethane Industrial processes CHP/ Heat Natural gas Vehicle fuel

7 Limited national gas grid Lysekil (LNG) Nynäshamn (LNG) Göteborg Falkenberg Helsingborg Denmark (pipeline) Lidköping (LBG) Laholm Bjuv Lund Malmö and Trelleborg The natural gas corresponds to ~ 3% of the total energy supply (~12 TWh) Biomethane is injected from 10 biomethane plants (~0,4 TwH)

8 Sweden is world leading in transporting gas off-grid 75-80% of the biomethane in Sweden is today transported on the road as compressed gas (200 bars) or as liquified gas (LBG) Local and regional gas grids gains more attention (for biomethane AND raw biogas) aimed to connect industries, cities and biomethane production plants with a LNG-terminal at the coast Read more in case story from IEA Bioenergy Task 37: Non-grid biomethane transportation in Sweden

9 Biogas production 277 biogas plants 1.8 TWh biogas (2014) ton ton 2013 Food waste collection in 190 of Sweden's 290 municipalities 1/3 of the potential used for biogas Few agriculture based plants

10 Biogas utilisation

11 The interest for gas vehicles is increasing (1%) (16%) 800 (1%) 2 % of the total vehicle fuel Buses provide a stable market for a long time, important for the dev. of vehicle gas in Sweden 155 public and 63 non public gas filling stations (5 with LNG/LBG) Source: SPBI Branschfakta 2014

12 Hybridbuses (biogas/electricity) in Malmö in Sweden The future: 24 m biomethane powered hybrid bus in Malmö from most frequent commuter line

13 The realizable biomethane potential for the vehicle fleet in Sweden 2030 TWh 25 Today s utilization: 1 TWh biomethane Totally 7 TWh biofuels Scenario(1) Scenario(2) No change (1) Source: Utredningen av Fossilfri fordonstrafik, Dec 2013 (2) Source: Energiläget 2014, Swedish Energy Agency

14 Biomethane in Sweden today Capital intensive business with still small profit margins and thus need additional drivers and good framework conditions Tax exemption + high fossil fuel taxes most important driver Retail at approx. 2 EUR/kg (CBG) Tax reduction on company cars 40 % / max EUR Long-term high-volume contracts securing the market Waste management + procurement of public transport Challenges ahead Missing: Extension of existing policies, no new ones to facilitate production growth (tax exemption ruled unlawful by the EU, 2016?? certificate system, continued exemption for bio-methane beyond 2015? ) Competition in the bus segment (HVO, electrification, diesel hybrids) Low oil prices

15 GoBiGas Biomethane plant in Gothenburg Producing bio-methane by gasification Injection into the transmission gas grid (30 bars) Feed stock: Forest residues Phase 1 - Demonstration 20 MW bio-sng (160 GWh/yr) + heat Cost: 160 M (24 M from Swedish Energy Agency) Phase 2 Full scale MW bio-sng ( GWh/yr) + heat Cost: 325 M (NER300 support 59 M available) Status Injecting into the transmission grid since December 2014 Sept 2015: 4500 hours of operation delivering ~8000 MWh Biomethan Decision for initializing phase 2 will be taken when phase 1 is proven successful Source: Ingemar Gunnarsson, Göteborg Energi AB

16 Bio2G possible future biomethane plant Production capacity: 200 MW bio-sng (1,6 TWh/yr) + heat & electricity Feed stock: forest residues Project owner: EON Investment cost: 450 M, (NER300 support 203 M available since 2014) Project is awaiting decision on the long-term policy instruments for biofuels Source: Björn Möller-Fredriksson, E.ON Gasification AB

17 Conclusions Sweden is world leading of utilizing biomethan as vehicle fuel and in transporting the gas off-grid 1.8 TWh biogas production, more than 50 % is upgraded into biomethane The national vision is to have a fossil free vehicle fleet in 2050 The Swedish biomethane potential is estimated up to 22 TWh (2030) Great need for a variety of short- and long terms politic-economic incentives so the biomethan (biofuel) potential becomes a reality

18 Thanks for your attention Read more about Energiforsk and our activities on