Economic analysis of biomethane and bioelectricity generation from biogas using different support schemes and plant configurations

Wojciech M. Budzianowski and Dominika A. Budzianowska

Energy, 2015, vol. 88, issue C, 658-666

Abstract: Commercial renewable energy projects are sensitive to policy instruments that shape the rate of deployment of renewables and affect their technological evolution. This study evaluates the economic performance of biogas projects under policy involving two novel instruments: (i) BFP (biomethane feed-in premium) and CMP (carbon mitigation premium) able to shape economic attractiveness and future technological evolution of biogas. The study reveals that only conventional biogas CHP plants are likely to be profitable under current policies. Biomethane plants require incentives e.g. from BFP, but interestingly the sufficient incentive can be more than 50% lower than the current incentive for electricity. The study also finds that innovative pressurised anaerobic digestion that can achieve direct carbon intensity of 13 tCO2 per GWhf (compared with about 168 tCO2 per GWhf for conventional biogas upgrading) can be very economically attractive, if policy combining BFP and CMP is implemented. The total support required from governments under the policy combining BFP and CMP instruments is similar or even lower than that currently available for bioelectricity. In addition, carbon mitigation benefits are achieved. Policy instruments and technological innovations are therefore critical for ensuring high energy outputs from biogas at a minimal economically justified carbon footprint.

Keywords: Biogas; Policy instrument; Biomethane; Bioelectricity; Pressurised anaerobic digestion (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (36)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0360544215007070
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:energy:v:88:y:2015:i:c:p:658-666

DOI: 10.1016/j.energy.2015.05.104

Access Statistics for this article

Energy is currently edited by Henrik Lund and Mark J. Kaiser

More articles in Energy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().