Biogas, ways of use - the case of Poland ` Biogas, ways of use - the case of Poland Michał Ćwil Vicepresident, Polish Economic Chamber of Renewable and Distributed Energy Business Development Director, PGB Dystrybucja Sp. z o.o.

Agenda Current situation of biogas Framework conditions statistics and market figures ways of use for energy purposes Framework conditions market entry policy on biogas support schemes Barriers, bottlenecks Selected thesis for debate

PIGEOR – who we are and what we do? Producers of green energy Suppliers of equipments Consulting companies

Biogas in Europe, 2013 Source: EurObserv’ER 2014

Biogas in Poland, 2013 Number of biogas plants Source: own estimates based on URE, ARR Number of biogas plants ktoe Landfill biogas: ca. 90 (55 MWe) Sludge biogas: ca. 70 (35 MWe) biogas production Agricultural biogas: ca. 35 (40 MWe); currently ca. 62 (75 MWe)

Way of use – technically all possible, but.. Biogas for energy generation fuel electricity heat gas distribution grid

New legal conditions – Act on RES

Biogas in electricity sector in comparison to RES

Entry the market up to 200 kW > 200 kW up to 40 kW Electricity Small generation facilities - registration URE/ARR Commercial generation facilities – license URE/ registration ARR up to 200 kW > 200 kW Micro generation facilities - registration OSD Electricity generation from biogas up to 40 kW

Selected definitions from the act on RES RES installation – set of equipments for electricity production and power output connected in one single connection point in the grid and the energy is generated from one kind of renewable energy source (...)

Selected definitions from the act on RES biogas – gas derived from biomas (...) agricultural biogas – gas generated in a fermentation process from agro products and byproductes or from forest residues (...)

Support schemes: investement and operational CAPEX OPEX grants + preferential loans +/- feed in tariff micro green certificate auction brown certificate or or or + feed in tariff CHP yellow certificate or or CHP violet certificate feed in premium (OREO supplement) ≤ 1 MWe >1 MWe

Green certificates – „old” system to support average prices in the wholesale market from the previous year - a guaranteed price for RES producers The unit substitution fee - "determining" maximum price for the green certificate 2016 average from 2015 303.03 („frozen“ ) 2015 163.58 303.03 2014 181.55 2013 201.36 297.35 2012 198.90 286.74 2011 195.32 274.92 2010 197.21 267.95 2009 155.40 258.89 2008 128.80 248.46 2007 119.70 242.40 2006 117.49 240.00 *) Zmiany wprowadzone ustawą o OZE

Green certificates – „old” system to support 303,03 303.03 inflation = 0 freeze unit substitution fee unit price of green certificate in stock exchange transactions A collapse in the market: more green certificates than willing to buy 2014 2015...

Barriers & threats biogas Threats related to substrates Convencional sources Shale gas biogas Increased substrates demand Blocking connections from other sources Suppliers market Threat of new entrants Energy crops Forest biomass Agricultural residues Agri-food residues Utility residues Food Animal feed Biofuels Chemical products Materials oligopoly of energy instability of the electricity market Bargaining power of offtakers

Selected thesis for debate Energy from Biogas provides energy security reduction in natural gas imports stabilization parameters of the power network distributed generation - security of supply for the local market balancing energy in the system – storage Connected businesses bio-fertilizer production heat production available locally waste utilization a new market for agricultural products

Thank you for your attention Polska Izba Gospodarcza Energetyki Odnawialnej i Rozproszonej 02-683 Warsaw, Gotarda 9 phone: +48 22 548 49 00, fax: +48 22 548 49 04, e-mail: pigeor@pigeor.pl www.pigeor.org.pl Polska Grupa Biogazowa S.A. 02-683 Warsaw, Gotarda 9 phone: +48 22 548 49 00, fax: +48 22 548 49 04, e-mail: biuro@pgbiogaz.pl www.PolskaGrupaBiogazowa.pl