Presentation given at the Conference of the European Biogas Association 2014.

1. VGGP Presentation
Biomethane in the Netherlands
– current state and future outlook -
Conference of European Biogas Association
Egmond aan Zee, Oktober 1st 2014
Michael Sanders
VGGP, president

2. VGGP, who we are:
Dutch Renewable Gas Producers Association
• The Dutch national organisation representing
biomethane producers and associated members
• Mission: To stimulate good conditions and markets
for biomethane production and to represent the
interests of biomethane producers at government,
policy and regulatory level
• VGGP represents Dutch national branche interests
via European Biogas Assocation (EBA)

3. VGGP, our producers
Projects
starting 1989
up to 2014

4. VGGP, our members
• Produce bio-methane from biogas at product
specifications to directly substitute fossil natural gas
• Some members make their own biogas from biomass
• Some members upgrade biogas from waste water
treatment or landfill gas (also 100% biomass)
• All producers feed “Green Gas” (bio-methane) into
the national Natural Gas grids at NG specifications
• Production started of liquid bio-methane (Bio-LNG)
• Some members are producing Bio-CO2 (gas+liquid)

5. VGGP, Technologies
• Digestion and biomethane upgrading
– Large scale (industrial up to 2200cm/h)
– Medium scale (agriculture waste 500cm/h)
– Small scale (rural / agriculture 40cm/h)
– Biogas grids with central upgrading unit
• CO2 recovery plus liquefraction
• Liquid biomethane (BioLNG)
– Medium scale operational (semi industrial)
• Power to gas (P2G)
– 2 demonstration projects in planning at medium scale (semi industrial)
• Biomass gasifcation (syngas) to CH4
– Research & demonstration (small scale)
– Technology needs further development

6. VGGP, facts and numbers
Also see: EBA NL country profile
• Production started 1989, in 2014 approx. 21 public
grid connections feed-in at natural gas specifications
• There are currently 5-10 companies involved
• All Green Gas made from ‘soft’ biomass feedstock
– Landfilled biomass (no new landfilling since 1990’s)
– Biomass recovered from municipal waste water streams
– Digesting solid/wet biomass (mostly from biowaste streams)
• Output 2013 remained below 100Mcm/a
• Subsidies (granted) could boost up to 300Mcm/a
• National ambitions 2020(downgraded!): 0,75BcmGG

7. VGGP, 200Mcm NL in plans……
IEA view on fossil investments
How about renewables?
Other issues,
Same problem !
Same issues !
Total costs renewables
may get to expensive
Same issue for
base-load renewables
Consequence of grid
imbalance is socially
unacceptable
Biomass market issues
Same issues !

8. VGGP, sustainable issues?
• “we have enough fossil fuels”
• “there is no climate change”
• “wind and solar will fix all needs”
• “hydrogen will fix the problem”
• “there is not enough biomass”
• “all biomass is needed for food”
• Etc. etc. etc.
• Mixed signals, who can we trust?

9. VGGP, what do we know..?
• … about security of supply?
One year of energy production
– 1000 eff. hours solarPV
– 2500 eff. hours wind
– Still > 6000h fossil?
• … about heat?
8760 hours
1000h PV
2500h wind
>> Can NL afford not-to-use biomass for energy? <<

10. VGGP, Biomass = carbon
Biomass is already cyclic at a rate 20 times fossil carbon emissions
• Biomethane substitutes bio-decomposition (and CH4 emissions)
• NL policy optimising biomass usage: key role for biomethane!

11. VGGP, Bio-methane ranking
• European Commission Joint Research Centre
2014 report: JRC85326 EUR 26237 EN
Code Description gCO2/MJ
OWCG1 Upgraded biogas from municipal organic waste 15
OWEL1a Biogas ex municipal waste, local Electricity from biogas plant ex municipal waste, Gas engine 20
OWCG4 Upgraded biogas from maize (whole plant) 40
CRET2 Maize, NG GT+CHP, DDGS as AF Maize (average used in EU) to ethanol 50
ROFA1 RME: Meal as AF, glycerine as chem, Rapeseed to biodiesel (Rapeseed Methylester), Meal export (animal feed) 60
GMCG1 EU-mix CNG from EU-mix NG supply 70
GRSD1 Rem GTL, diesel pool Remote NG to Syndiesel (GTL): GTL plant near remote gas field, 75
GRLG1 LNG, road Remote LNG, use as LNG in vehicle 80
GPCG1a Pipeline 7000 km CNG from imported NG 7000 km (typically Russia) 85
EMEL2 EU-mix medium Electricity from average EU supply. Medium voltage 140
KOEL2 EU-mix Coal IGCC Electricity from (hard) coal (EU supply mix), IGCC 260
Bio-methane and biogas CHP rank most favourable in benchmark

12. VGGP, Social Acceptance
Social Acceptance of renewable energy projects:
(Project: use biomass => produce energy => sell energy)
– The energy product is socially accepted, there are markets
– Production facilities are socially accepted: IPPC permits
– The renewable feedstock’s are socially accepted: NTA 8080
– Society accepts the costs for energy transition via SDE+

13. VGGP, renewable issues?
….…., because we are still searching for more
sustainable fossil fuels to keep our economies going!

14. VGGP, NL on renewable
Technical circle waste management
• Reduce
• Re-use
• Recycle
• Replace / Re-design
• Recover energy
Biological circle BBE
• Pyramid cascading biomass:
Requires big volumes
Large volumes remain unused
Transit to technical circle
• Minerals and organic matter are
essential for life on earth!

15. VGGP, Renewable feedstock
Biomass for energy is an essential part of the chain:
(Project: use biomass => produce energy => sell energy)
– Avoid direct use of biomass, priority for food and cascading BBE
– Cascading shares the effect of iLUC, biodiversity, depletion
– P2G further increases digesting process carbon efficiency +60%
Biomass
Cascaded
feedstock
Sunlight + Water + CO2
Food & products
Consumption
Benzene
Toluene
Xylene
Lignine
Cellulose
Hemicellulose
Minerals and organic matter
Loss of all minerals and organic matter
End use for energy
Chemicals
Energy
CO2 & fuels
P2G
Cement and chemical waste!
Bio-
Based-
Economy

16. VGGP, Biomass feedstock
• There is still al lot to be organised:
Biomass sources >...production capacity, logistics and storage,
technology for cascading biomass, solutions for by-products,
biomass certification, matching supply and demand, spot
markets, exchanges for long term contracts, market makers and
brokers, clearing and financial services… > Physical delivery.
• For Social Acceptance and Subsidies on energy we
need a transparent and efficient biomass market.
• An incomplete market may lead to unwanted market
behaviour, free-riders and leakage of subsidies.

17. VGGP, Markets
For biomass projects there are three mayor “markets”:
Biomass
market
Energy
project
Energy market
and subsidies
By-product
market
Subsidies “leak” if there is an incomplete biomass market
Subsidies “leak” into the energy “market” via costs and fees

18. VGGP, Products & markets
“Your product may not be sold in my market, because I
want you to fully comply with my standards!”
Biomass
Digestate use as
compost &
fertilizers
End of waste
criteria
Bio methane
specifications
Conventional
fertilizer
REACH
Open market +
Regulated
Gas grid access
Natural
Gas
– Open market: No barriers via “product safety issues”
Biomass based end of waste products and biofuels contain
impurities and are very easy to discriminate via “fossil based
standards” like NG based Feed-in specifications and
REACH.

19. VGGP, Products & markets
NL regulation perceived as a grave financial risk
(no project bank-loans) and causing severe
financial losses for operational VGGP members:
• Gas spec issue: EC standards Bio-methane (Dutch GasLAW changes as
of today, Oct 1st, this will solve NL feed-in problems in time)
• Transport tariffs charged to Bio-methane on NG gas grids, issue is
disputed by VGGP members. GasLAW change will prohibit this at last.
• Demand to exceed fossil gas HHV (Hs in MWh) without compensating
Bio-methane producer for economic vallue. HHV rises in NG plus as a
physical result from gas safety setpoints resulting from specifictions!
• By-law’s (netcode) to be set by Regulator (ACM), current proposals are
set for less efficiency and additional costs for Bio-methane feed-in.
• Netting on CO2 for Bio-methane Certificate of Origin (ReC) now proposed
(implies selective cut on SDE+ subsidies “after the fact”)

20. VGGP, Netting ReC on CO2
Favours pathway’s electricity over bio-methane and favours farmed crops over bio-waste!
Local pathways on
NL sites CO2/MJ may
be netted in ReC by
LAW (-% less income)
15gCO2/MJ
-/- 3,9 (-25%)
20gCO2/MJ
-/- 0,5 (-2,5%)
Remote pathways 25gCO2/MJ
not netted in ReC
40gCO2/MJ
-/- 3,9 (-10%)
45gCO2/MJ
-/- 0,5 (-1,1%)

21. VGGP, ReC transparency
• Renewable energy Certificates: Keep it transparent!
100%

22. VGGP, Level playing field!
• Production and end-use may conflict. Level the playing
field! Gas volume and CO2 balancing between countries
Supply CER Cancel CER => CO2 emitted
Subsidies Taxes for RE
ReC value Trader A Trader B
Country A
Renewable surplus
Renewable deficit
CO2 costs in power pricing
Customer A Customer B
Customer C
no CO2 costs
In power
pricing but
“no free rider”
Energy lost
Fossil gas
• Physical energy exchange obligatory for gas. Country B corrects ReC for transmission losses.
• Country targets set for Production mix or residual mix? How about EC targets RE and RED?
• Customer C should compensate both ReC value + CER CO2 costs for Country A.

23. VGGP, Transition costs
Power price effect on SDE+ subsidies 8760 hours
1000h PV
2500h wind
There is no free lunch!

24. VGGP, Transition in general
>> Can NL afford not-to-use biomass for energy? <<
<“YES, we will use biomass for energy, but with care!”>

25. VGGP, The way forward!
• If we have established a common ground to for a
renewable energy production mix (including biomass)
• And we have also found socially acceptable places to
develop energy projects
• Plus there is a common ground about using the
project feedstock biomass for energy production
• And if there are budgets to enable the transition
Public Acceptance for renewable energy phase 2 :
We have to re-assure stakeholders why they accepted!
Example: Dutch Green Gas as renewable transport fuel.

26. VGGP, Biogas fuels 1.0

27. VGGP, Transport fuels 1.5
”Why mobility using Bio-methane as a fuel?”
Well to Wheel CO2 emissions
Impact on local air quality
Bio-methane

28. VGGP, Transport fuels 2.0
”Mobility using bio-methane for fuel”

29. VGGP, Transport fuels 3.0
”Mobility using your own biomass for fuel”
….. Collect your bio
wastes for us and…..

30. VGGP, Transport fuels 3.1
”Mobility using your own biomass for fuel”
….. We will digest your
biowaste and inject bio
methane into the
national gas grid…..

31. VGGP, Transport fuels 3.2
… via our partners we
deliver Green Gas to your
local filling stations …….
CNGnet

32. VGGP, Transport fuels 4.0
Bio LNG

33. Biomethane
+CO2 +P2G
+ BioLNG
33
Digestate
Green Gas
+ CO2
for
Sustainable
feedstock
Regional gas grid
National gas grid
Green Gas
Biogas
Minerals
+ Organic matter
REGIONAAL NATIONAL
CHP/Heat
Agriculture
Waste water &
Proces water
Green Gas
and BioLNG
Transport
fuels
Bio-waste &
energy recovery
BBE Cascaded
Products

34. VGGP, Q&A / comments?