This project development step comprises all activities from getting permits for building and operation, organising the financing and funding for the bioenergy project till the fundamental planning of the plant construction and bringing it into service. The farmer has to get into contact with different authorities and institutions, as e.g. consultancy firms for detailed planning, banks, local communities or companies which will be needed for building the biogas plant. Additionally, the farmer has to provide all the data and plans relevant for successful project realization.
The complexity and time frame of this step among others is depending on type and size of the biogas plant and especially in which country the plant will be erected. Also the proceedings and effort for e.g. getting permits may also differ for each country and also within the various provinces.
Apart from the technical parts, aspects of acceptance are also very important for realizing a bioenergy project. It must be considered to involve the public in an early stage to avoid unpleasant delays later in the project realization.
Agricultural biogas plants are often built close to agricultural sites (farms) and are often, depending on national legal framework, seen as a “building structure” and therefore needs at least a building permission by national construction law.
Some plants need approval according to Emission Control Regulations, also depending on national legal framework. These approval processes are normally more complex as well as more demanding and requires higher efforts in terms of time, organization and finances than the permission by construction law.
In principle (in many countries), there is a right to a plant authorization, if public regulations and concerns of occupational health and safety are not indicating otherwise. The regulations relating to the construction and operation include, for example:
construction planning act
occupational health and safety law
water protection legislation
nature conservation law
The farmer has to get the required permits for building and operating the biogas plant from the local authorities and maybe other relevant institutions. It may be necessary to realize a detailed technical plan of the plant location and construction to receive those permits.
Some requirements to be considered by the manufacturer and/or farmer for construction of a biogas plant:
noise and odour report for operation near residential areas, if necessary
sufficient storage capacity for digestate (no land-spreading during winter time) landscape conservation plans
fire protection design
structural engineering (statics) for tank construction observe the requirements for concrete quality
technical and operational safety acceptance of the facilities for starting operation
The applicant should contact the responsible approval authorities early in the process. The first discussion, in which the designer of the plant should be present, is to introduce the project to the authority. It is not only to make personal contact with the authorised person, but it will illustrate the framework of the project clarifies what conditions are imposed and what documents are required.
For producing and injecting of biomethane (biogas upgraded to natural gas quality) into the gas grid, special regulations have to be observed.
The approval of planning should be done in close contact with the plant manufacturer or delegated plant planner themselves and the agricultural advisor. Depending on the type of the required permit and the approval authority the amount of documents that have to be handed in may vary strongly. A checklist for the compilation of the approval documents can be found in the "Checklists" part of the present e-learning module.
Financing - Funding
Bioenergy projects are generally financed through own funds and / or borrowings or loans. Under certain circumstances, the project can be financially supported through funding from promotion programs (public funds).
An essential prerequisite for a project financing is basically the appraisal in a feasibility study. The content and results of the feasibility study can, among other things, convince potential lenders and investors from the technical feasibility, economic viability and creditworthiness of the project.
Basically a credit institution and / or a qualified financial advisor should be involved early in the preparation of a financial plan to get the feedback on affordability in an early stage of the project (e.g. at the end of the feasibility study). The requirements of the bank concerning project information, documentation and collateral should also be clarified in time, which then form the basis for the comprehensive appraisal. The funding can be tightly coupled to the operator model and the legal form of the company.
The provision of equity capital is usually essential for lending by banks. Normally, a minimum ratio of equity capital in form of a self-financing or a quasi-equity loan has to be provided to receive state financial assistance or standard bank loans. The equity capital includes also cash assets and contributions in kind (e.g. operationally necessary goods). The capital requirement depends on the ownership structure (existing or newly established companies), the specific investment costs and the economics of the project.
In the case of partial financing through a credit, the early contact with a credit institution is important for a successful financing. The bank is the first and crucial point in this way. It offers free consultations to be informed about various financing and funding opportunities, ranging requests for financial assistance to the relevant institutions. For borrowing the provision of adequate guarantees is absolutely necessary. The presence of sufficient collateral is thus a crucial part of project financing. The protection of the loans by the bank might be guaranteed e.g. by:
mortgages (charge on the land)
collateral assignments (e.g. the entire plant or individual machinery)
purchase guarantees for produced power and heat
Form and scope of standard collateral should be agreed as part of the loan negotiations between the borrower and the bank.
The framework of project funding differs from country to country and is also regional in its nature, scope and objectives. Basically, the promotion can be distinguished in subsidies in investment and development loans (interest-subsidized loans).
The biogas technology has so many positive aspects. It is a e.g. a renewable energy source, has versatile utilisation forms (electricity, heat and fuel), can be used flexible (bioenergy which is storable and allows energy production on demand) and generates additional income for agriculture and rural areas. Despite all this, in some countries the biogas technology is treated negatively in the media and biogas investors have to deal increasingly with citizens' groups and neighbours who are against the biogas plant (NIMBY-Effect - not in my backyard).
Social barriers or poor acceptance are often related to the increasing traffic for transporting and harvesting energy crops (too many vehicles, too noisy and too many exhaust emissions). In addition, there is often the opinion in public that biogas plants are smelly and also dangerous (danger of explosions) so that the plants are not tolerated near residential areas. Also, in some regions the cultivation of energy crop is seen problematically. Opponents claim that intensive energy crop cultivation has negative effects on the beauty of the landscape, decreases biodiversity and causes over-fertilisation of soils plus excessive use of pesticides and herbicides.
Therefore, the farmer should get into contact with his neighbours to present them the biogas project and discuss it together (visiting existing biogas plants would be an idea). Experience proves that it is always better to involve the public in an early stage to make them understand the benefits of the project, so they don’t feel disregarded and complain at the end.
Apart from the technical planning a number of aspects of acceptance are relevant, which must be considered in advance of the plant building, if necessary. This is in the first place the early information of the public or neighbours. Essential criteria of a good acceptance are e.g.:
creating an open communication atmosphere and the responsiveness for insecure neighbours
name potential impact of the biogas plant, such e.g. odour development, increasing transport traffic, in a realistic way – don’t whitewash the issues (e.g. it “never stinks”)
involve (local) proponents of the project in the public relations
clarify the question of plant location early and if possible amicably appoint benefits of the project for the community
offer opportunities for participation
where appropriate involve mediators for conflict prevention and resolution
residents should be given the possibility to get to know the biogas plant, for example by arranging an “open day” presentation
a good and responsible plant management is indispensable and requires expertise
Events for interested citizens for presenting information and allow discussions about the project are an essential part of the planning procedure. External experts may be invited to discuss certain issues (e.g. legal framework, health, etc.) and thus to increase the level of information and understanding to the local people.
Contracting for realization
For realising and operating a biogas plant it may be necessary to clarify certain trade relations in bilateral treaties. The number and legal nature vary depending on the business model.
Essential for every project is usually a plant construction contract. Also the substrate supply and digestate delivery must often be contractually regulated. In addition, a plant management contract can also be completed, if necessary. By selling surplus heat of the own CHP or (raw) biogas to external customers, delivery contracts may be required. Also concession agreements with private landowners and easement agreements with the municipality might be of importance for the plant operator.
All contracts should be tailored to the individual needs of the contractors to offset their own best interests. The contracts with energy customers (e.g. for heat delivery) have to be updated regularly.
In the "Contracting" part of the present e-learning module, different types of contracts are presented and essential aspects are described in detail.
The farmer/stakeholder should do a tendering process to choose the best plant manufacturers for building the biogas plant. Therefore the future plant operators must inquire the manufacturer, which will be considered to build the plant, to create and submit offers which are comparable and allow a thorough evaluation. For a good comparison some offers should be sought.
When comparing the offers, it is important to look beyond the mere price. Equally important is the quality and expected/guaranteed output offered, the experience of the manufacturer and the services they propose when it comes to support, repair or maintenance of the biogas plant. It is also important to decide, whether it should be a turnkey construction by a plant manufacturer (low work load and project planning time required) or if it should be planned and realized by an engineering company (larger share of own (farmer’s/stakeholder’s) work on construction possible).
It’s always beneficial to visit existing plants of the manufacturers or engineering company and get in contact with the plant operators in order to benefit from their experiences.
Construction and commissioning
A good project management needs a good organization. Therefore, it is important that the farmer/stakeholder has a good overview on the plant construction phase. Unexpected events and costs must be avoided to ensure that the project will be finished successfully.
The farmer/stakeholder has to make a detailed schedule with the plant builder / manufacturer to have an overview on the whole process of plant building and installation. It enables the various parties to deal with bottlenecks and avoid interruptions at an early stage. Each step must be presented in terms of resource requirements, budget and duration and they must follow a logical order. Regular reports on construction process help to keep this schedule updated.
During the construction, farmer/stakeholder and expert have to check scrupulously three points:
Quality: Is the job under control and professionally executed? Does the farmer really receive what he expected/ordered? Do plant parts have failures? The security of a biogas plant is a very important aspect.
Financial aspects: are there any unexpected expenditures? If yes, why weren’t they anticipated?
Deadline: is the building operation on time regarding the time-schedule (sometimes, start of operation has an effect on amount of feeding-in tariffs)?
After building and installation of the biogas plant has been finished, the facility starts operation. For that, it will be tested and approved (failures will be reported) by the plant manufacturer and/or authorised experts. After successful testing and commissioning the biogas plant is ready to produce biogas.
Ramp-up to steady operational state
The project realization ends when the anaerobic digestion plant has been built. The next and essential step of the project starts when all structural and technical components of the plant are installed and the operating license has been granted: the start of operation.
For the staring-up various tests and inspections must be organized and carried out. Initial operation of a biogas plant is made up of the technical (duration a few days) and the biological part (duration some weeks).
Before starting up the biogas plant, the plant owner must check if all the obligations included in the building permission are fulfilled. The entire gas system should been tested for tightness. The documentation for the technical units as well as for the entire biogas plant must be present, which also includes instructions for initial operation, a risk assessment and an explosion protection document.
Starting up a biogas plant should always be done by the company who designed and built the plant. During the start-up phase, the farmer and the staff who will operate the plant, will be advised in running and maintaining the biogas plant.
From a technical perspective the start-up of the biogas plant is only acceptable, if the safety devices are functioning and in compliance with the regulations information about safety listed in the operating instructions of the manufacturer.
Biological initial operation is often referred to as "start-up", depending on the used biomass the process needs minimum some few weeks’ time and can last up to 6 months. The biological start of a biogas plant should be thoroughly planned and organized in advance and already possible before the technical start-up.
When the biogas plant has started its operation, which daily, monthly or yearly measures are necessary for control, maintenance and for securing substrate and fuel provision? From now on the farmer has to do regular controls and maintenance to assure security, safety (especially concerning emission standards) and efficiency.
For a farm scale biogas plant, with an electrical power capacity (equivalent) of up to 75 kWel, the labour time (net) for operating and maintenance is usually approx. 1.8 hours per day.
The required measures/tests (either on a day to day basis or in case of problems) should have been listed and detailed in the plant instructions of the manufacturer who built and installed the facility.
An analysis of practice data from operations diaries of 31 German biogas plants showed that within a year a total number of 1,168 operational disturbances were documented by the operators. It was found that the plant component CHP-Unit, solid substrate feeder, pumps and agitators were the most susceptible parts. The qualitative evaluation of this disturbances showed, that the biological process has been the fifth most frequent reason of malfunctions.
Experience shows that an average of 138 working hours per biogas plant and year are needed to solve all the malfunctions apperaring. On average for every 10 kW of installed electrical power 1.2 malfunctions occurred per biogas plant and year.
These results point out the importance of consequent process control. Most significant indication for a process disturbance is a noticeable decrease of biogas yield respectively methane concentration. In contrast to technical problems – which can regularly be solved quite fast – process disturbance are more difficult to correct and require a basic understanding of the farmer for the biological processes and inhibition of the anaerobic fermentation.
Most of the controls may be done continuously by control and monitoring systems (like temperature of the reaction, the amount of substrates, the quantity of gas/electricity/heat produced, etc.) but others might require expert support or can be done by the farmer himself (e.g. resolve liquid leakage at pumps, oil changing at CHP, small repairs etc.).
The farmer has to ensure maintenance and observe the maintenance intervals (important for warranty of plant parts) of the biogas plant and the downstream equipment. Some maintenance can be done by the famers himself (e.g. scheduled replacement of wear parts as filters, seals and replacing or replenishing supplies or consumables like engine oil or water) or by certain service providers (e.g. general overhaul of CHP unit).
Measuring is the precondition for process control and optimisation. But the necessary measurement equipment creates costs, which often – especially on small scale installations – tried to be avoided during implementation.
Consequent documentation is the only way to get reliable information on status and efficiency of the biogas production process. The collection of data over a longer period is not only necessary for self-control, but also relevant in case of troubles diagnostics and consultancy by external experts.
As a very simple, effective and less laborious method is the so called "input or operations diary”. Furthermore, in some countries (for example Germany) data on input of the plant must be available due to legal requirements.
Advantages of an input diary are:
traceability of quantity and quality of input substrates (also supplier where needed)
control and optimisation of volume load
economic efficiency calculations (supplier, gas demand, electricity demand, operation hours)
gas leakage detection
The input diary should include the following information:
amount of every substrate or substance fed into the process
gas quality (CH4, CO2, H2S)
amount of gas utilized
(net) operating hours
fuel demand (in case of pilot injection gas engine)
electricity injected to the grid
Construction and operation of a biogas plant is related to a number of important safety issues, potential risks and hazards for humans, animals and the environment. Taking proper precautions and safety aim at avoiding any risks and hazardous situations and contribute to ensuring a safe operation of the plant.
Fulfilment of important safety issues and stipulating clear preventive and damage control measures is a condition for obtaining the building permit (this may differ depending on country):
fire & explosion prevention
sound static construction
noise emissions protection
asphyxiation, poisoning prevention
hygienic and veterinary safety
avoidance of air polluting emissions
prevention of ground and surface water leakages
avoidance of pollutants release during waste disposal
collision and tear-off protection
Apart from poisoning and asphyxiation, there are other potential dangers related to the activity on a biogas production site. In order to avoid these types of accidents, clear warnings must be placed on the respective parts of the plant and the operating personnel must be trained:
Other potential sources of accidents include danger of falling from ladders or uncovered areas (e.g. feed-funnels, maintenance shafts) or to be injured by movable parts of the plant (e.g. agitators)
Equipment like agitators, pumps, feeding equipment is operated with high electrical voltage. Improper operation or defects of the CHP unit can result in fatal electric shocks
Risks of skin burning through unprotected contact with the heating or cooling systems of the biogas plant (e.g. motor coolers, digester heating, and heat pumps) must be considered. This also applies to parts of the CHP unit and to the gas flare
For these reasons, it is advisable that operators and staff of a biogas plant are trained on plant safety. This qualifying measure raises the awareness of the operator for potential hazards on site, it helps to safely operate the plant and to establish safe procedures if external companies need to work on the biogas plant.