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Promoting Biogas Production in Germany and France Feed-In Tarif Systems 18.09.2012; Biogas-E Conference; Gent Belgium

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IZES gGmbH presentation IZES is an associated research institute of the Saarland University of Applied Sciences, which is doing applied research in renewable energies, decentralised energy systems, energy efficiency and regional material flow and resource management. 2012: appr. 40 scientific employees

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Current IZES Biogas Research Projects (selected) Inter- / regional Biogas Benchmarking Studies: RUBIN Masterplan Biomass Saarland Integrated Zero Emission Concepts for Communities Research Area on Energy Crops: ENERBIOM: Sustainable Biomass Production in Grand Region SaarLor Lux OPTIBIOGAZ: Optimized and Integrated Processing of Agricultural Biogas Production Research Area on Organic Residues : ARBOR: Acceleration of organic residues valorization INEMAD: Improved Nutrient and Energy Management through Anaerobic Digestion

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Renewable Energy Supportives Schemes Feed-In-Tarif Systems Quota Systems Subsidies and Fiscal Regulations (tax, loans) Public Tender Systems 27 EU Member States: 20 Feed-In Tarif Systems 6 Quota Systems Additionally Swiss: Feed-In Tarif System Map: res-legal.com; Display promotion schemes IZES gGmbH

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Selected Country Reports on Biogas Supportives Target Countries: Germany, France, Belgium and Luxembourg [ OPTIBIOGAZ & ARBOR] Feed-In Tarif Systems & Different Designs 5 France/ Region Lorraine Germany/ Saarland Map: Interreg IV A Pororam, Project Optibiogaz

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Basics Elements of Feed-In Tarif Systems Fixed price per produced kWh over fixed time period [Investment Security] Annual Degression on tarifs [Investment Incentives] Tarif differences according to Plant Capacities, Efficiency Criteria, Input Materials [Steering Impacts] Additional costs pay end-consumers [Macro-Economical Distribution and Energy Savings Incentives] Entitlement of Connection to the grid and Payment of grid expansion by grid operator [Security of Power Sales] 6

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Outlook installed biogas capacity 2010 - 2020 Source; Interreg IV B NWE Program, Project ARBORs: Interreg IV A Program, Project Optibiogaz; EBA NREAP Analysis

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8 06-06-2012 "Au Pays de l'Attert" asbl Feed - In Tarif System in Germany

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Energy Concept 2020 Federal Republic of Germany Mobilisation of regional biomass potentials under Avoidance of energy food discussion Shift from former energy crops acceleration (2004 EEG) Priorities on organic residues and waste materials Increase in Effciency, as energy and land management, on demand supply Acceleration of Biomethane by establishing an advanced supportive instrument for grid connection and tarifs Sustainability Criteria according to EU and German legislation as mid-term requirements 9

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Feed-In Tarif Law- Biomass/ Renewable Energies 2012 Feed-In Tarif Methodology Capacity related categories with fixed tarifs for 20 years Basic tarif between 14,3 and 6 ct/kWh Capacity categories : 150, 500, 750, 5.000 kW el [Extra tarifs for 75; 20.000 kW] Cumulative with 2 Input related tarif categories ( 27 EEG i.c.t). Amendm. BiomasseV 2012) and biomethane injection 10

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Feed-In Tarif Law- Biomass/ Renewable Energies 2012 Steering function via tarif pricing; Biomass Ordinance 2012 included methane content per biomass Basic Fee for mainly agro-industrial side products Waste bread, backery residues, potatoes, rape cake,food resdiues; road greeneries, etc. Input Category I: former Energy Crop Bonus Maize, Crops, Sugar Plants, Sorghum, etc. Input Category II: not sufficient energetical utilization Straw, manure, agricultural grass, Silphie, etc. Increased Degression from 1% to 2% on Basic Tarif No Degression on Input Tarifs (Raw Material Price Development)

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Feed-In Tarif Law- Biomass/ Input regulations New: input combination and proportional input related tarifs Limitation of maize and corn crop input to 60 Mass percent Special tarifs for small agricultural plants (75kW) with minimum of. 80 Mass percent manure No tarifs for waste wood, forest wood or liquid biomass Cumulative Tarif for Injection of Biomethane into the gas grid Extra high Tarif for Organic Wastes, if system integrated post rotting process cumulative inputs with energy crops etc. (NEW) 90% waste input (s. Biowaste Ordinance) If conditions are not met: Tarif see residue input categorizations 0, I, II (Biomass Ordinance) !

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Efficiency Conditions for tarif EEG 2012 New: Minimum heat recovery of 60% (annual balance) ! Former voluntary 3 ct/ kWh CHP-Bonus, here integrated in Basic Tarif Approved Heat Recovery according to Annex 2 EEG (e.g. Wood Chip Drying!?!) Covering process internal heat demand up to 25 % (Digester) Softenizers 1st year of operation heat recovery of only 25% Unavailability of Heat Sink while operation: after 6th year of operation 80% of tarif is available Alternatives to 60% Heat Recovery 60% Manure Input runned plants (high GHG reduction) or Direct marketing (Market boni)

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Direct Marketing Switch towards direct marketing Obligatory Direct Marketing: Direct Market Sales from Start of Operation 2014: > 750 kW No EEG Tarif but Market prices Optional Direct Marketing: Market bonus Difference between market price and Feed-In Tarif average price at power exchange spot market Additional management bonus for Trade expenses and Demand supply, enterpre. risks 14

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Flexibility Bonus Addtional installed capacities Demand oriented power supply Contractual arrangements with grid operators Incenives for bigger plants and gas storage systems 15

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Further Support Schemes in Germany Federal Schemes Germany Kreditanstalt fr Wiederaufbau (KfW): Construction and Capacity upgrade of AD by loans up to 100 %. Max. Credit volume 5 Mio. Euro.Small scale plants financial support of 15.000 Euro Indirect promotion via regional integrated climate protection concepts Klimaschutzinitiative des Bundes (KSI) Federal StateSaarland KlimaPlusSaar Research amd Development- innovative plants for biogas production 16

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17 06-06-2012 "Au Pays de l'Attert" asbl Feed - In Tarif System in France

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Pluriannuelle des Investissements de Production Electrique (PPI) French Bioenergy Feed-In Tarif System for power production by renewable energies Public Tender System for the promotion of biomass big scaled projects in selected French regions Only feed in tarifs for organic residues of municipal wastes, agricultural residues, forestry and related industries, sewage sludge No energy crop promotion Increase in energy efficiency by extra Bonus Extra Tarif for Biomethane injection into gas grid 18

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Feed-In Tarif System France Feed-In Tarif methodology Feed in tarif system with capacity oriented categories Fixed prices over 15 years Annual degression/progression on basic fee in regard to inflation Manure Bonus Energy Efficiency Bonus: no heat self demand 19

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Public Tender System Public Tender for big scaled power plants for renewable energies Issued by Ministry for Energy and evaluation by regional control Organisations Renewable energy power acceleration Published not regulary European Union wide tender Additional Tarif and further benefits for plant operator Claim for contract with grid operator for payment and grid connection Higher tarifs per kWh than Feed-In Tarif System caused by market oriented pricing 2010: 14,5 ct/kWh el Contract time [2010 20 years] 20

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Public Tender France Tenders for Combined Heat and Power Biomass Projects Technical requirements Open for all Biomasses in generell Total capacity for regions in France Evaluation Criterias Price !, Supply securiity concepts, location, efficiency Price offer important because of market orientation Biogas Projects with no priority 21 Ausschreibungszeitraum [Projektauswahl] Ausgeschriebene el. Leistung fr EE Gesamt installierte el. Leistung 2003 [2005] 250 MW (50 MW aus Biogas) 232 MW (davon 16 MW Biogas) 2006 [2008]300 MW314 MW 2009 [2010]250 MW266 MW

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Biomethane Injection Garantuee of grid uptaking for injected biomethane into public gas grid Tarif depends on Input materials Municipal wastes: 9,5 -6,4 ct/kWh Residues from agriculture and forest industries inclusively food production residues: 12 and 8 ct/kWh Tarif fixed for 15 years Higher promotion of smaller scaled plants Proof of biomass origin Biomethane injection Tarifs since 2011 22

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Further Support Schemes in France Sustainable Development Tax Credit (2006 - 2012): 50% 23

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More Information via IZES gGmbH & ARBOR Research External Information Management IZES gGmbH www.izes.de www.optibiogaz.com www.enerbiom.com www.arbornwe.com

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Thank you for Attention IZES gGmbH Katja Weiler (MSc.; Dipl. Jur.) Altenkesseler Str.17, Geb. A1 66115 Saarbrcken/ Germany Phone: +49 (0) 681 9762 862 Fax: +49 (0) 681 9762 850 Email: weiler@izes.deweiler@izes.de Homepage: www.izes.dewww.izes.de Kontakt