Biomass - Using Anaerobic Digestion

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Funding and Grant Availability

Transforming Waste Scotland

logo: transforming waste Scotland

This is a programme funded under the DTIís New Opportunities Fund. Transforming Waste Scotland is a body initiated by SEPA, Forward Scotland, RAGS and Keep Scotland Beautiful to administer and coordinate this funding.Under this Scheme £4.3 million is available for projects seeking funding for waste reduction and recycling purposes. There are three main focus points under this scheme, which each project must achieve

  1. To increase the amount and range of materials recycled, recovered and diverted away from landfill.
  2. To increase the numbers of households involved in recycling, reuse and composting projects.
  3. To develop sustainable communities and to engage communities in local waste reduction activities.

Eligibility for projects under this scheme requires

  1. The project company must be of charitable or not for profit status.
  2. The project company must have social or environmental objectives.
  3. The project must show community involvement and benefit.
  4. The project company must show a track record and turnover appropriate to project or a viable business plan.
  5. The project must show a long-term viability ≠to ensure continuation once grant funding ceases.

Funding for eligible projects is available for Capital and Revenue costs. There is no limit on the percentage of cost that may be granted funding, grants in the range of £20,000 to £300,000 will be made over a maximum period of three years. However a maximum of £100,000 is available for Capital costs.

Wrap Organics

logo: wrap organics

WRAP ≠ Waste and Resources Action Programme

Wrap is a not-for-profit company supported by funding from DEFRA, the DTI and the devolved administrations of Scotland, Wales and Northern Ireland. It is working to promote sustainable waste management by creating stable and efficient markets for recycled materials and products. Funding has been made available from 2003-2006.

WRAP Organics Capital Support Programme aims to support projects that increase the amount of Biodegradable Municiple Waste (BMW) diverted from landfill, and examine market creation for high quality by products of organic wastetreatment.

Funding is available to a maximum of 30% of capital cost only. There is no limit on the amount of funding available. The initial round of funding in 2003 was not applicable to Scotland, but the Scottish Executive has now granted assistance to enable successive rounds to include projects in Scotland. The current round of funding is at application stage, and projects should submit applications by May 2004.

European Life Programme

logo: european life programme

Life- Environment EU Programme is designed to promote synergy between demonstration actions and the guiding principles of EU Community environmental policy with a view to sustainable development. Waste Management is one of the policy areas supported by LIFE funding.

Funding is potentially to be extended to cover until 2006. The current round is now closed to applications and ends in 2004.

The Renewables Obligation Scotland (ROS)

logo: renewables obligation scotland

The Renewables Obligation came into force in April 2002, and requires licensed electricity suppliers to source at least part of their electricity from renewable generation. The amount of the Renewables Obligation starts at 3% of total electricity supplied to customers in Great Britain in 2002/2003 and reaches 10.4% in 2010/2011. A licensed supplier can meet its Renewables Obligation by producing ROC/ROS to Ofgem or making a buy-out payment or a combination of both. The Government has reinforced its commitment to the scheme by announcing in December 2003 an intention to consult on an increase in the level of the Renewables Obligation for the years between 2010/2011 and 2015/2016.

This has increased the demand for renewable generation quite considerably in recent years thanks to the mechanisms employed in the penalties set at producers who do not meet their quota. If a producer opts to buy out some of its required quota from Ofgem, this money is collected together in the buy-out fund. This money together with any interest earned, is then redistributed back to suppliers who have correctly produced ROC/ROSs for the obligation period. This acts as a double incentive as not only are those suppliers that do not meet their quota fined, but their fine is redistributed among their competitors, which could have implications on their market position.

The following graphs illustrate the scale at which this buy out fund can operate, the buy out price for the first period (April 2002- March 2003) was £30 per MWhr. This figure is adjusted annually inaccordance with RPI figures.

graph: buy-out redistribution England and Wales

Fig 1. RO (England and Wales) buy-out redistribution(from The Renewable Obligation - Ofgem Report)

The buy-out distributed to each supplier (or group) under the RO. Powergen received the largest amount for all their supply licences under the RO at £22,878,003.

graph: buy-out redistribution Scotland

Fig 2. ROS (Scotland) buy-out redistribution (from The Renewable Obligation - Ofgem Report)

The buy-out distributed to each supplier (or group) under the ROS. Scottish Power received the largest amount under the ROS, £3,778,730.

Thus under this system, demand for renewable generation is high among Electricity Supply companies, and in addition to installing their own renewable fuelled plant, they are purchasing Electricity from green sources. This has created a market demand for guaranteed generation from renewable sources- the first year of operation has shown that almost 50% of qualifying generation is from landfill gas generation, 20% from wind, and 11% from biomass. It is envisaged that a biogas plant if installed would qualify for ROS certification and therefore the electricity generated would be sold to an electricity supplier at a profitable price.

Intelligent Energy - Europe

logo: intelligent energy europe

Intelligent Energy (EIE) is the Communityís support programme for non-technological actions in the field of energy, precisely in the field of energy efficiency and renewable energy sources. The duration of the programme is from 2003-2006.

Intelligent Energy ≠ Europe is intended to support the European Unionís policies in the field of energy as laid down in the Green Paper on Security of Energy Supply, the White Paper on Transport and other related Community legislation (including the Directives on renewable electricity, energy performance of buildings and biofuels).

The programme is structured in four fields

SAVE ≠ improvement of energy efficiency and rational use of energy, in particular in the building and industry sectors,

ALTENER - promotion of new and renewable energy sources for centralised and decentralised production of electricity and heat and their integration into the local environment and the energy systems

STEER - support for initiatives relating to all energy aspects of transport, the diversification of fuels, such as through new developing and renewable energy sources, and the promotion of renewable fuels (biofuels) and energy efficiency in transport

COOPENER - support for initiatives relating to the promotion of renewable energy sources and energy efficiency in the developing countries, in particular in the framework of the Community cooperation with developing countries in Africa, Asia, Latin America and the Pacific.

Under the Altener programme there are three programmes that are applicable to biomass applications

  • VKA6 RES Electricity
  • VKA7 RES Heat
  • VKA8 Small Scale Renewable Energy Systems

Calls for the VKA7 and VKA8 are due in 2004 for proposal. Funding for up to 50% of project costs may be available and projects must be submitted by team of three independent legal entities, each of which are established in different EU or EFTA countries.

6th Framework Programme

logo: 6th framework programme

The FP is the EUís main instrument for research funding in Europe. The Sixth FP (FP6) was implemented on January 1, 2003. One of the areas supported by FP6 is Sustainable Energy Systems under the strategic and policy objectives of reducing greenhouse gases and pollutant emissions (Kyoto), increasing the security of energy supplies, improving energy efficiency and increasing the use of renewable energy, as well as enhancing the competitiveness of European industry and improving quality of life both within the EU and globally.

Two different streams are targeted under the funding criteria of FP6:

Research activities having an impact in the short to medium term

Proposals addressing short-to-medium term research should comply with one or more of the following guidelines:

  • Deliver results, which will accelerate the market penetration of innovative energy technologies with a particular emphasis on 2010 energy policy objectives.
  • Consist mainly of integrated demonstration actions with a typical research component of up to about 20% and including, where appropriate, pre-normative research, energy technology integration, dissemination and technology transfer activities. The risks to be addressed are mainly technological and might include market related and financial issues.
  • Demonstrate reductions in the costs associated with implementation of new technologies and/or demonstrate how innovative technological solutions can be integrated under full-scale operating conditions.
  • Provide inputs for the future development of energy policy and legislation, including the improvement of existing regulatory measures, whilst serving EU research and related policies.

For this programme the upcoming calls for proposal will be issued in June 2004 with a deadline submission date of Dec 2004.

Research activities having an impact in the medium to long term

Proposals addressing medium-to-long term research should:

  • Deliver results which could be widely exploited commercially or otherwise, with a time horizon generally beyond 2010; further development and particularly demonstration type actions may be necessary before technologies are ready for full-scale commercial use.
  • Consist mainly of research and development activities (including pre-normative and socio-economic research and the validation of technical and economic feasibility in pilot plants and prototypes), research-related networking activities, training and dissemination activities. The main risks to be addressed are scientific and technological rather than market and financial.
  • Lead to the generation, exploitation and dissemination of new knowledge and contribute to the implementation of EU research policy, whilst also contributing to the development of energy and associated policies.

This programme will have a deadline submission date of Sept 2004 with a submission deadline of Dec 2004.

For Programme 1 a project will require participation from partners from 3 states with a minimum of 2 EU member states and 1 accession state. For Programme 2 a project will require participation from a minimum of one entity of one member or accession states.

Climate Change Levy

The Climate Change Levy is a tax on the use of energy in industry, commerce and the public sector, and provides additional support for energy efficiency schemes and renewable sources of energy. The levy forms a key part of the Government's overall Climate Change Programme. The reforms are intended to promote energy efficiency, encourage employment opportunities and stimulate investment in new technologies. The levy was introduced on 1st April 2001. Rates of levy were set then at 0.15p/kWh for gas, 1.17p/kg (equivalent to 0.15p/kWh) for coal, 0.96p/kg (equivalent to 0.07p/kWh) for liquefied petroleum gas (LPG), and 0.43p/kWh for electricity. The levy package is expected to lead to reductions in carbon dioxide emissions of at least 2.5 million tonnes of carbon a year by 2010. The levy does not apply to oils, which are already subject to excise duty. Revenue from the levy will be recycled to business via a cut in employers' National Insurance Contributions and extra support for energy efficiency measures.

Electricity generated from new renewable energy (e.g. solar and wind and biomass power) is exempt from the levy. As with the ROS system, this encourages the purchase of renewable electricity and thus promotes a viable Renewables market. In relation to Biogas production if it is possible to use the electricity generated for on site needs and also achieve export of electricity the plant would be exempt from Climate Levy and could be bought by a supplier/consumer keen to reduce its climate change levy.