STEPHEN KEMP: INVESTING IN AD REQ
Is your anaerobic digestion project investment ready?
T
he payback on anaerobic digestion (AD) can be excellent given the right project. But even pre- accredited projects, with planning
permission and an electrical connection, can fail at the investment hurdle. As an investor in AD projects, we would
ask two key deciding questions. Does the project have a robust feedstock pipeline for at least the next ten years? And is there a credible outlet for the digestate? ENER-G has a 30-year history of investing in CHP and biogas utilisation projects, and has developed over 170MW of and overseas. Over the last 12 months we have been actively seeking investable AD projects, but many supposedly ‘spade-ready’ projects have not proved ‘bankable’ due to sustainable supply issues with feedstock and a lack of consideration for digestate disposal.
Of the projects that ENER-G has
developed or is developing from scratch, we put robust feedstock supply ahead of any other component of the project. Without a
ENER-G anaerobic digestion facility
What are the key for success criteria for a ‘bankable’
anaerobic digestion project? Stephen Kemp, Head of AD for ENER-G, provides an investor’s perspective
reliable, minimum 10-year feedstock supply, we simply do not have a viable project. A credible digestate outlet is the second Often farmers understand that digestate offers value in terms of its ability to fertilise land, but underestimate the volume and logistics in moving such large quantities of solids and liquids.
Lye Cross Farm A recent AD investment by ENER-G is a project in partnership with organic cheese maker Lye Cross Farm, based in North Somerset. The Alvis family has run their excellent forward-thinking business over three generations. This project will create renewable energy from lactose permeate and plant washings. The business has agreed to a 15-year feedstock contract, giving ENER-G the security to invest in the design, installation and operation of the complete AD facility. With over 50 million litres of material to process, digestate was going to be an issue. It was agreed that the Alvis family will be responsible for the removal of all digestate. In return ENER-G will install a system that separates the solids from the liquids - enabling the solids to be land spread and providing a valuable organic fertiliser. The liquid fraction will be passed from the AD facility to an aeration system, and this treated water will be pumped to Lye Cross Farm’s sizeable dairy herd to hydrate their cattle. As such, a neat closed loop solution has been created, which overcomes the two main barriers to developing an AD project.
Complete funding support Biogas utilitisation and AD specialist ENER-G provides a complete outsourced AD service at no capital cost. This includes the design, installation, and operation of anaerobic digestion renewable energy facilities and can help organisations combat rising water
REQ
ENER-G shoulders all the development, planning, permitting and overall financial risk - sharing operational savings with customers over an agreed contract term. This provides businesses with a steady and attractive income stream.
FOR FURTHER INFORMATION Contact ENER-G for a free consultation. Email:
stephen.kemp@
energ.co.uk www.energ.co.uk/biogas
28 REQ RENEWABLE ENERGY QUARTERLY |
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AUTUMN 2014
www.r-e-a.net
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