biomethane

Swifter H2 framework action needed to secure EU funds

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Procedures to establish a regulatory framework on hydrogen, biomethane and CCS need to be accelerated, otherwise the country risks missing out on crucial EU support funds promoting these sectors through the Energy Transition Fund, market sources have stressed. The regulatory framework needs to be finalized by a June 30 deadline.

Officials at RAAEY, the Regulatory Authority for Waste, Energy and Water, and the energy ministry are currently engaged in talks with market players interested in developing hydrogen-related projects but needing clarity.

The emergence of the hydrogen market as a new market poses regulatory and operational questions. It is not yet clear how these responsibilities will be distributed.

Though final decisions have yet to be taken, the energy ministry appears inclined to appoint RAAEY as the hydrogen sector’s regulatory authority and gas grid operator DESFA as its operator, as the sector will use networks already managed by this operator, energypress sources have informed.

As for distribution, the ministry appears likely to take the course taken in other European markets, where the role of distribution network operator is performed by companies that make the investments, resulting in multiple small distribution systems.

Biomethane production draft bill to be presented in first quarter

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The energy ministry plans to present, for public consultation, a draft bill covering biomethane production in the first quarter of 2024 before having it ratified in parliament in the second quarter of next year.

As part of a private consultation, the ministry organized a meeting last week with all entities involved to discuss the new sector’s legal framework and key aspects such as securing raw material for biomethane production, connecting production units to the network, and establishing a support scheme, energypress sources informed. Participants will need to submit their comments by Wednesday.

Over 150 officials took part in the meeting, held last Thursday, including biogas producers, gas transmission and distribution network operators, gas suppliers, relevant ministries, public organizations, RAAEY, the Regulatory Authority for Energy, Environment, and Water, and consumer representatives.

According to sources, the energy ministry is currently promoting a support scheme similar to a model chosen for the incorporation of batteries at RES units. It would combine investment and operating support for new biomethane production units.

As for the cost of connecting new biomethane production units or existing biogas facilities  that will be converted to biomethane plants to the distribution or transmission networks, the ministry favors a formula that would require the operator to assume the entire cost if production units are located less than kilometer from connection points; evenly divide the connection cost between operator and producer if production units are between one and ten kilometers from the network; or require producers to cover the entire connection cost if their units are located over ten kilometers from the network.

Ministry launches talks for biomethane sector framework

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The energy ministry is currently engaged in consultation with biogas producers, gas transmission and distribution network operators, gas suppliers, other relevant ministries and public bodies, as well as RAAEY, the Regulatory Authority for Waste, Energy and Water, to formulate policies for the promotion of biomethane production in Greece.

The ministry aims to establish Greece’s first ever institutional framework for biomethane production.

Deputy energy minister Alexandra Sdoukou set the procedure in motion by requesting the opinions of all the aforementioned entities on a relevant study conducted by a National Technical University of Athens team headed by professor Sotiris Karellas.

The NTUA study offers a description of biogas production technologies and the country’s potential in this field, while also proposing institutional measures and financial support schemes for this purpose.

Recipients of a related email forwarded by the deputy energy minister have been asked to offer their comments on the NTUA study by December 20.

Measures proposed in the study include upgrading existing biogas facilities into biomethane facilities, particularly if close to gas distribution and transmission networks; establishing new biomethane production facilities, especially in farming and livestock farming areas; issuing renewable gas certificates for the establishment of a renewable gas market; and utilizing carbon captured during the production of biomethane to produce synthetic fuels.

Brussels fully approves Greek list of REPowerEU projects

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The European Commission has approved all energy projects included on a new list prepared by the energy ministry and submitted to Brussels for support through a revised REPowerEU program.

Brussels’ approval comes as a positive first step, but plenty of work lies ahead if the projects included on the REPowerEU list are to be actualized.

The REPowerEU program, proposed by the European Commission in response to the 2022 Russian invasion of Ukraine, aims to end the EU’s reliance on Russian fossil fuels before 2030.

Based on past experience, the energy ministry knows well how challenging it will be to coordinate various agencies in the public and private sectors so that a Resilience and Recovery Fund deadline, set for December 31, 2026, is met. The revised RePowerEU section, which includes projects budgeted at 795 million euros, is part of Greece’s RRF.

The available period of just over three years may seem like plenty of time, but given the complexity of the projects, it is not.

Greece’s 795 million-euro RePowerEU list is made up of 560 million euros for energy saving projects, 75 million euros for hydrogen and biomethane projects, 75 million euros for a Carbon Capture and Storage (CCS) supply chain, and 85 million euros for energy storage systems.

Additional €795m REPowerEU funds sought for key projects

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A request just submitted by Athens to the European Commission for amendments to the Resilience and Recovery Fund includes a new RePowerEU section worth an additional 795 million euros, intended for support to key projects. If approved by Brussels, some of these projects may commence development this year, with full-scale development planned for next year.

Indeed, the successful implementation of these projects will depend on the efficiency and agility of the Greek public administration. As projects progress to the next stages, the need for accelerated procedures and effective management will become increasingly crucial to meet critical milestones and secure funding.

Most of these additional funds, a 560 million-euro majority, are planned to be allocated to new rounds of subsidy support for energy efficiency upgrades of residential properties and businesses.

A 150-million sum is planned to be made available for pilot projects concerning biomethane production and, primarily, carbon capture and storage (CCS) initiatives.

The remaining amount, 85 million euros, is planned to be offered to investors for energy storage system installations.

DEDA awaiting biothemane operator license 7 months on

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Gas distributor DEDA is still awaiting a license that would establish the company as a biomethane operator seven months it submitted a related application to RAE, the Regulatory Authority for Energy.

DEDA lodged its license application to RAE on December 6, 2021 as part of its effort to move ahead with the country’s first biomethane distribution pilot projects.

Over the past two years, DEDA has been working on procedures for the establishment of legal and regulatory frameworks needed for commercial utilization of biomethane through the distribution networks it operates.

DEDA has already signed memorandums of cooperation with two biogas producers entailing upgrades of their facilities for production of biomethane, to be injected into networks and distributed as a mix with natural gas.

The first biomethane distribution pilot project is planned for the Nigrita area in Serres, northern Greece, to primarily supply household and business consumers. A second project, in Alexandria, Imathia, also in the country’s north, is planned to supply mostly industrial consumers.

Furthermore, on July 4, DEDA submitted a complete proposal to the energy ministry for the development of a biomethane market in Greece, based on revisions to laws concerning biogas, renewables and natural gas distribution. This proposal puts the price of biomethane below that of natural gas.

Biomethane a priority for DESFA, pilot project in the making

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Gas grid operator DESFA, placing biomethane interests among its priorities, intends to forward a related proposal to the energy ministry by the end of June as part of ongoing consultation for regulatory framework revisions that will enable the Greek market to incorporate biomethane as a new commercial activity.

DESFA, supported by consultants, is preparing a related study on amendments needed to existing laws – covering domains such as environmental and building matters – for the development of a biomethane market in Greece.

Biomethane could replace natural gas for the operation of a compressor station in Thessaloniki’s Nea Mesimvria area and another in Abelia, Thessaly, central Greece, now being developed.

Both locations are situated close to areas offering considerable waste quantities, which makes biomethane projects viable solutions that will significantly limit DESFA’s environmental footprint.

The biggest part of DESFA’s transmission network is relatively new and could, as is, or with minor revisions, host green gases, namely biomethane and hydrogen. New network sections now being developed would be ready to transmit green gases from the start.

DESFA is currently holding preliminary talks with market players for possible partnerships in a pilot biomethane project. However, the operator intends to finalize its biomethane business plan before deciding on any partnerships.

 

REPower EU plan overambitious, ‘an objective, not a specific strategy’

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The European Commission’s REPower EU transition plan, aiming to greatly reduce Europe’s reliance on Russian gas, is overambitious and should be regarded as an objective rather than a set of specific measures, officials taking part in the recent annual Gas Infrastructure Europe conference, an authoritative sector event, have concluded.

The calculations offered by the REPower EU plan are incorrect, Torben Brabo, GIE’s president, has told the Euractive agency, adding that a closer look at the figures concerning Russian natural gas supply, LNG supply, as well as biomethane projections, renders the European plan as overambitious.

LNG availability and purchase projections in the REPower EU plan are possibly too high, the GIE president stressed.

Officials linked with LNG infrastructure told the GIE conference that the LNG market’s actual conditions will prevent the EU plan’s lofty targets from being achieved. Anything beyond 50 percent of the target set will be difficult to attain, these officials contended.

American current gas liquefaction capacity does not suffice for supply of an additional 15 bcm of LNG to Europe, as specified in the EU plan, officials taking part in the GIE conference contended.

Qatar and other LNG exporters in the Middle East have already committed amounts to non-EU buyers, while the REPower EU plan’s 35-bcm biomethane objective appears to be too optimistic, they added.

 

 

 

 

EU’s Fit for 55 revisions to include reduced gas use

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The European Commission is preparing to present, in May, details of its Repower EU program, a strategy aiming to greatly reduce Europe’s reliance on Russian energy. Until now, the plan has been limited to objectives, without specifics on how these targets could be achieved.

Further revisions of the EU’s energy and climate policy – as presented in the recent Fit for 55 package, which set a target of a 55 percent reduction of carbon emissions by 2030, compared to 1990 levels – will be needed, through legislative revisions and directives.

The revisions could include greater tolerance for lignite and gas infrastructure, until recently treated strictly, as well as measures for an acceleration of RES and energy storage development.

As was pointed out at the recent energypress Power & Gas Forum by Pantelis Kapros, Professor of Energy Economics at the National Technical University of Athens, the EU’s energy policy, concurrently managing economic, energy security and environmental concerns, is now shifting towards greater emphasis on energy security as a result of Russia’s invasion of Ukraine and the move’s wider repercussions.

Even so, the Fit for 55 objectives for 2030 are expected to be maintained, while RES targets may be raised to more ambitious levels.

The EU will also look to reduce natural gas consumption for electricity generation and heating through the use of biomethane quantities in excess of 35 billion cubic meters by 2030, green hydrogen quantities of 20 million tons by 2030, as well as energy storage system development, noted Professor Kapros, one of the architects of the EU’s energy policy.

The EU’s Fit for 55 package had originally planned for 164 bcm of Russian gas imports in 2025 and 131 bcm for 2030, but these quantities are now expected to be greatly reduced to 74 bcm and 33 bcm, respectively.

DEDA: Framework ‘pending’ for biomethane, hydrogen

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Procedures leading to the establishment of legal and regulatory frameworks needed for commercial utilization of biomethane and hydrogen need to be accelerated by the government and the regulatory authority, Marios Tsakas, chief executive of gas distributor DEDA, has stressed in an interview with energypress.

Greece, from a technical and technological point of view, is ready to move ahead in the biomethane and hydrogen domains, the DEDA official pointed out.

Two pilot projects carried out by the company could develop into twenty mass-production projects if the pending legal and regulatory frameworks are completed and authorities give the green light, Tsakas noted.

The DEDA chief executive expressed optimism on the prospects of natural gas, noting that wild price fluctuations amid the energy crisis do not diminish the strategic advantages offered by this fuel, which can contribute significantly to reduced energy cost.

DEDA is preparing for the Greek market entry of sector giant Italgas, which has acquired gas company DEPA Infrastructure, Tsakas noted, adding that the arrival of this new investor, possessing enormous expertise of over 100 years in the natural gas sector, will lead to further growth that will benefit DEDA.

“We are network operators and, therefore, must be able to respond efficiently and responsibly, whether we are talking about pure gas networks or a mixture of gas and hydrogen, or biomethane,” Tsakas remarked.

 

DESFA looks to biomethane, hydrogen, plans grid investments

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Greek gas grid operator DESFA plans to invest in biomethane and hydrogen infrastructure to be in a position to utilize these eco-friendly gas options and avoid being impacted by the energy transition.

DESFA’s experienced European gas companies holding stakes in the Greek operator believe green biomethane technologies are more developed and mature compared to those available for hydrogen.

Snam, Enagas and DESFA’s other shareholders – Fluxys, Damco – have set as a primary objective to “decarbonize the natural gas chain”.

DESFA officials are in talks with universities, market authorities, as well as Greek enterprises to develop biomethane pilot programs.

More projects such as the White Dragon project – bringing Greece’s biggest industrial corporations closer for major investments in electrolytic hydrogen production by means of solar energy from photovoltaic parks – can be expected next winter, officials anticipate.

If the White Dragon project is approved, DESFA plans to upgrade its existing natural gas network in order to be able to receive hydrogen production, transport from the country’s north to south, channel to TAP and, via TAP, transport to the EU.

DESFA’s share of the White Dragon project, estimated between 30 and 35 percent of the cost, is expected to reach 1.5 billion euros, of which one billion euros – if the project is approved – will concern the development of new infrastructure for hydrogen transmission through the Greek gas network, measuring 1,466 km.

New gas project support to end, aid until 2029 for conversions

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EU funding support for new natural gas and oil-related projects is expected to end soon, but will remain available over a transition period until December 31, 2029 for natural gas projects and gas transportation and storage infrastructure conversions catering to hydrogen, natural gas and biomethane needs before ultimately serving as hydrogen transportation and storage facilities, exclusively.

The council of EU energy ministers accepted Trans-European Energy Networks (TEN-E) regulation revisions incorporating these funding support changes at a meeting in Luxembourg.

The revisions, designed to help the EU achieve carbon neutrality by 2050, are planned to be implemented in 2022, if ratified.

The revisions also include measures designed to offer sustained protection for market competition and energy supply security.

The proposed revisions identify 11 priority energy corridors and three thematic priority areas for projects of common interest funded through the Connecting Europe Facility (2021-2027).

DEPA Commercial to enter RES field, starting with 200-MW goal

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DEPA Commercial, the new entity emerging from gas utility DEPA, will enter renewable energy production as part of the company’s transformation from a gas to energy company, its administration has decided.

The firm has already held talks with green energy players with the aim of involving DEPA Commercial in solar and wind energy projects about to enter the construction stage or already being constructed, sources informed.

An initial objective for the accumulation of a green-energy portfolio comprising approximately 200 MW has been set by the company, sources added.

Careful steps are being taken in the RES sector, Dr. Konstantinos Karagiannakos, the company’s Coordinating Director of Trading Activities, recently noted.

Having lost a steady and reliable market share in gas distribution, a sector that guaranteed DEPA annual profit of about 25 million euros, DEPA Commercial is now eyeing new activities and revenues from domains that offer more consistency than trade, entailing higher risk.

Besides the RES sector, DEPA Commercial’s lower-risk approach has also led to an interest in the prospective Alexandroupoli FSRU in northeastern Greece.

The company is also broadening its activities to cover gas supply for the industrial sector and customers in areas without gas networks, through small-scale LNG and remote CNG solutions, as well as the gas-run vehicle market through the development of a nationwide network of refueling stations.

In addition, the company is also making plans to enter eco-friendly alternative fuel markets such as hydrogen and biomethane.

 

DEPA Commerce 5-year business plan includes turn to RES sector

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Gas company DEPA Commerce’s five-year business plan for 2020-2024, containing investments estimated at 200 million euros, aspires to broaden the company’s interests by also incorporating renewable energy projects totaling 200 MW, either through independent development or acquisitions of mature plans.

Privatization fund TAIPED and the energy ministry are expected to approve the DEPA Commerce business plan within July.

DEPA Commerce was formed by gas utility DEPA as a new entity for its privatization procedure.

Besides RES projects, the DEPA Commerce business plan also includes hydrogen and biomethane projects, as well as electromobility initiatives.

The company’s expansion of business activities is expected to lead to greatly increased EBITDA and profit figures.

Once finalized and approved, the DEPA Commerce five-year business plan will be included in the due diligence package for prospective bidders.