European Commission initiates 'health check' of Common Agricultural Policy - implications for bioenergy

The European Commission today unveiled its blueprint for streamlining and further modernising the European Union's Common Agricultural Policy (CAP). The so-called 'Health Check' of the CAP, presented by Agriculture Commissioner Mariann Fischer Boel, will build on the approach which began with the 2003 reforms, improve the way the policy operates based on the experience gathered since 2003 and make it fit for the new challenges and opportunities in an EU of 27 Member States in 2007. The CAP determines, amongst many other things, the amount of subsidies European farmers receive for biofuel feedstock production and how much land will be set-aside.

CAP reform is one of the major causes for political dispute amongst EU member states that are large recipients of farm aid (France, Spain, Germany), and those that aren't. Likewise, given that support has mainly benefited large farmers, their smaller collegues have been advocating a review of the policy.

The previous reforms have modernised the CAP, but the Health Check represents the opportunity to take the policy review further. It will ask three main questions:

1. how to make the direct aid system more effective and simpler
2. how to make market support instruments, originally conceived for a Community of Six, relevant in the world we live in now
3. and how to confront new challenges, from climate change, to biofuels, water management and the protection of biodiversity

Today's communication is designed to kick off a wide-ranging six-month consultation. Next spring, the Commission will return with legislative proposals, which it hopes will be adopted by agriculture ministers by the end of 2008 and could come into effect immediately. During 2007 and 2008 the Commission will develop its approach to the budgetary review 2008/2009. The Health Check constitutes a preparatory action within this framework, without prejudging the outcome of this review. It fine-tunes the 2003 reforms and contributes to the discussion on future priorities in the field of agriculture.

Does the fact that we are conducting a Health Check imply that the patient is sick? Certainly not: but it's quite normal for perfectly healthy people to visit their doctor to see whether they need to do anything different to ensure they stay in good shape. In the same way, we need to look at whether we need to adjust the CAP for an EU of 27 and a rapidly changing world. The changes I propose will make a real difference for farmers, consumers and taxpayers. - Mariann Fischer Boel, Commissioner for Agriculture and Rural Development

A key reform measure is to simplify the Single Payment Scheme which was introduced in 2003, with the aim to replace the subsidies linked to the amount of food a farmer produced, a change described as "decoupling". The Commission now suggests further measures for simplication of the payment system:

• moving away from payments based on historical receipts towards a "flatter rate" system
• increasing the rate of "decoupling" in those countries which opted in a number of farm sectors to maintain the link between subsidy and production, although coupled support may still play a role in regions where production is small-scale but of particular economic or environmental importance.
• gradually reducing the support level as overall payments to big farmers increase, starting from a level of, for example, €100,000 per year. This would have to differentiate between multiple-owner farms with many workers and single-owner farms with just a few.
• increasing the amount of land a farmer has to own before he qualifies for EU support from the current level of 0.3 hectares.
• reviewing the Cross Compliance standards which farmers are obliged to respect to receive their support from Brussels. This could mean stripping out unnecessary obligations, but also adding new ones to deal with new challenges like improving water management and mitigating climate change.

Concretely, the direct payment received by farmers would be capped according to the amount of aid they receive, in the following way:

• up to 100,000 euros - unaffected
• 100-200,000 euros -10% cap
• 200-300,000 euros - 25% cap
• above 300,000 euros - 45% cap

Such a system would naturally target the larger landowners and the commissioner says it would have to differentiate between multiple-owner farms with many workers and single-owner farms with just a few. At the other end of the scale, a minimum level of payments could be set before aid kicks in, although the commissioner says it would not affect "real farmers" (as opposed to mere landowners):
energy :: sustainability :: biomass :: bioenergy :: biofuels :: energy crops :: biodiversity :: subsidies :: Common Agricultural Policy :: EU ::

Another major goal of the reform effort is to adjust market support instruments to make them relevant for an EU of 27 in our modern day and age. The Communication asks critical questions:

• should intervention revert to its original purpose as a real safety net – particularly as market prices today are in such good shape?
• could intervention for most cereals be set at zero while maintaining intervention for a single cereal (bread-making wheat)?
• should set-aside not be abolished, while finding new ways of preserving the environmental benefits it has brought?
• milk quotas are already programmed to disappear in 2015, but should there not be a gradual increase in quotas between now and then to allow a 'soft landing' for the sector? This must look at possible measures to help dairy farmers in those regions of the EU – like mountain areas – which depend heavily on dairy production.

Agriculture Commissioner Fischer-Boel recently announced her intention to submit to the Commission a proposal to set at 0% the obligatory set-aside rate for autumn 2007 and spring 2008 sowings, in response to the increasingly tight situation on the cereals market, which is a development related to biofuels production (previous post).

New challenges
Finally, the Commission wants reform so that European agriculture can responding to new challenges. These include: managing risk, fighting climate change, managing water more effectively, making the most of the opportunities offered by bioenergy and preserving biodiversity.

Climate change and water management objectives could be met through Cross Compliance, There should be incentives to improve action in these areas but this will cost money, the communication says. The best way to finance the necessary new measures is through Rural Development policy.

The communication therefor proposes increasing the rate of 'modulation', i.e. the reduction of direct payments to all farms receiving more than €5,000 per year and the transfer of the money into the Rural Development budget. This would be increased gradually from 5 percent now to 13 percent in 2013.

Finally, the Commission states that it must also be examined whether the energy crop premium is still necessary given new incentives for biofuel production such as the compulsory bioenergy targets and high prices.

Fischer Boel recently announced that she will proppose a scale back of the special aid scheme aimed at developing Europe's energy crop sector, after it emerged that farmers have already massively shifted production towards biofuels, overshooting a two million hectare target. The amount of land for which farmers up to now received a subsidy of €45 per hectare (US$26/acre) in exchange for planting energy crops (such as rapeseed or sugar beet that can be processed into biofuels for cars or biomass for heating or electricity) will thus be reduced after the scheme proved too popular (previous post).

More information:
European Commission: Agriculture: Health Check to streamline Common Agricultural Policy and address new challenges - November 20, 2007.

European Commission, Agriculture and Rural Development: CAP Health Check.

Biopact: EU to free up set-aside land to ease cereal prices - July 30, 2007

Biopact: EU cuts back on energy crop subsidies - October 18, 2007

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EU and China launch first phase of carbon capture & storage research project

China’s CO2 emissions from using coal are set to double by 2030, the scale of which is significant in the context of mitigating global climate change. In view of the essential role of coal in China’s energy system, it is vital to minimise emissions where this most polluting fossil fuel is used. One of the most immediate interventions is the introduction of CO2 capture and storage (CCS), fitted to coal fired power plants. With the launch of the EU financed Near Zero Emissions Coal (NZEC) Phase 1 study in Beijing, today, Europe hopes to contribute to developing the science needed to achieve this.

The NZEC initiative was announced as part of the EU-China Partnership on Climate Change at the EU-China Summit in September 2005. The Joint Declaration on climate change stated that the EU and China will aim "to develop and demonstrate in China and the EU advanced, near-zero emissions coal technology through carbon capture and storage" by 2020.

Biopact tracks initiatives that deal with carbon capture and storage, because the technology can be coupled to bioenergy and biofuel production, thus potentially opening an era of negative emissions energy. Contrary to nuclear power or renewables like wind, solar or hydropower, which are all 'carbon-neutral' at best, bioenergy with carbon storage (BECS) is 'carbon-negative': it takes CO2 out of the atmosphere. All the groundwork and research presently going into CCS for coal, is extremely useful for the development of a negative emissions energy industry that would emerge once a global carbon market is established.

In China, carbon-negative bioenergy systems could emerge sooner than expected. Another EU-project there looks at how coal fired power plants can be adapted to co-fire biomass; likewise, Chinese companies are doing similar retrofitting work in a commercial way (e.g. Enersave). If these biomass-powered plants were to be coupled to CCS, they would supply negative emissions.

The aim of the EU-China NZEC agreement is to bring forward the time when coal plants will be built with CCS in China and in the EU. It will build on planned European research and demonstration activity and will facilitate technology transfer between European industry and researchers, and their counterparts in China. A Memorandum of Understanding (MoU) was signed between the UK and the Chinese Ministry of Science and Technology (MOST) on December 19th 2006 to detail specific UK funded action.

The British Geological Survey (BGS) leads the British contribution to the cooperation effort, and attended the launch of the project today.

CCS offers the opportunity to reduce emissions per unit of electricity by 85 - 90%. Large-scale deployment of CCS in China has potential to significantly reduce future greenhouse gas emissions. - Dr. Nick Riley MBE, Head of Science for Energy at BGS

Phase 1 of the project involves the following aspects:

1. The assessment of the potential for carbon capture and geological storage in China;
2. The identification of opportunities for demonstration and deployment of carbon capture and storage in China;
3. The review of costs and economics of near-zero emissions coaltechnology through carbon capture and storage in China;
4. The identification of options for financing the research and demonstration of carbon capture and storage in China;

The geotechnical aspects of the research will involve selecting strategic sedimentary basins to be mapped for potential regional CO2 storage assessments (geocapacity), followed by more detailed assessment of sites potentially suitable for a demonstration of CO2 storage in China linked to a demonstration of CO2 capture from a coal-fired power station. A Geographical Information System (GIS) linking current and planned large CO2 point sources to potential geological storage options (source-sink matching) will be constructed.
energy :: sustainability :: bioenergy :: biofuels :: carbon capture and storage :: coal :: biomass :: negative emissions :: BECS :: China :: EU ::

BGS and the China University of Petroleum (Beijing) co-ordinate the CO2 geological storage part of the study, which also includes working in close partnership with Heriot Watt University, BP & Shell (UK) and the China University of Petroleum (HuaDong), Institute of Geology and Geophysics Chinese Academy of Sciences (CAS), Tsinghua University, PetroChina, Jilin Oilfield and China United Coalbed Methane Corp (CUCBM). NZEC is funded by the UK Government through Defra and DBERR and is co-ordinated by AEA Energy & Environment (UK) and ACCA21 (China).

The British Geological Survey (BGS), a component body of the Natural Environment Research Council (NERC), is the UK's principal supplier of objective, impartial and up-to-date geological expertise and information for decision making for governmental, commercial and individual users. The BGS maintains and develops the nation's understanding of its geology to improve policy making, enhance national wealth and reduce risk. It also collaborates with the national and international scientific community in carrying out research in strategic areas, including energy and natural resources, our vulnerability to environmental change and hazards, and our general knowledge of the Earth system.

The BGS co-ordinates the CO2GeoNet European Research Network of Excellence on the geological storage of CO2 and is the UK's foremost public sector organisation conducting research into the feasibility of underground CO2 storage as a means of decarbonising fossil fuel emissions. The European Network of Excellence on geological storage of CO2 is sponsored by the European Commission under the 6th Framework Programme and promotes research integration within the scientific community to help enable the implementation of CO2 geological storage.

It is an integrated European scientific community comprising more than 150 established researchers and postgraduate students, durably engaged in enabling the efficient and safe geological storage of CO2 as a solution for clean and climate-friendly energy production and consumption. The partnership unites 13 research institutes, spanning 7 European countries, with a high international profile and critical mass in CO2 geological storage research. The initiative is the largest group of researchers in Europe working together on CO2 geological storage; together, CO2GeoNet's partners have the most direct and longest research experience on geological CO2 storage in the world. The Network provides independent scientific research and expertise integrating a wide range of knowledge.

Recently, Australia and China announced a similar research cooperation effort to study CCS opportunities in the People's Republic. This partnership agreement is smaller and more concrete, though: it paves the way for the installation of a post combustion capture pilot plant in Beijing next year (previous post).

References:
British Geological Survey: UK scientists lead China closer to carbon capture and storage - November 20, 2007.

UNFCCC: Near Zero Emissions Coal Initiative [*.pdf].

Biopact: EU project to help China use biomass in coal plants - November 23, 2006

Biopact: China EnerSave retrofits coal plants to burn biomass - June 18, 2007

Biopact: Australia and China partner to develop carbon capture and storage technologies - September 07, 2007

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France's ethanol sector would collapse if subsidies are cut - highlights case for a Biopact

France's nascent ethanol sector could collapse if the French government goes ahead with plans to slash subsidies key to the survival of the sector, a top industry official said. This is obvious and good news to those who advocate a more rational biofuel market - one in which countries in the South are allowed access to Northern markets to supply biofuels that are far more efficient, do not require subsidies and bring social and rural development.

According to the Global Subsidies Initiative, there is no reason as to why wealthy farmers in the EU and the US should receive massive subsidies for the production of inefficient biofuels that do not really reduce greenhouse gas emissions (previous post), while developing countries could tap their large land and agro-climatic resources to produce much better fuels. This would allow millions of poor farmers to enter a new market that offers, in the words of the UN's Food & Agriculture Organisation's director, a 'historic opportunity' for poverty alleviation.

EU farmers should be not be allowed to keep their colleagues in the developing world in poverty and wreck a chance to mitigate climate change. The case for an alternative situation - a win-win 'Biopact' between the North and the South - is therefor supported by all major think tanks that have studied the biofuels future (the Global Bioenergy Partnership, FAO, the IEA, the OECD, the WorldWatch Institute, the UNIDO, and many others).

Ethanol currently makes up just under a third of French biofuel production. The rest comes from biodiesel, mainly derived from crops like rapeseed. The French ethanol sector is heavily reliant on subsidies in the form of a lower TIPP fuel tax, that makes the fuel competitive with gasoline at fuel pumps. Ethanol currently benefits from a €0.33 per litre discount when sold at petrol pumps, but that amount could soon be halved, said other industry sources.

Alain Jeanroy, co-ordinator of France's ethanol industry group, the talks on upping the TIPP tax are well advanced in the framework of inter-ministerial discussions and are causing great concern.

The lower TIPP fuel tax is just one of the many subsidies and protection measures French farmers enjoy. From the EU they receive subsidies for each hectare of land they devote to growing energy crops. Moreover, they are protected by steep import tariffs on ethanol. Ethanol with an alcohol content of 80 percent is subject to a tariff of €19.20 (27 dollars) per 100 litres. 'Denatured' alcohol, which has a lower content, is taxed at just over half that level (previous post).
energy :: sustainability :: biomass :: bioenergy :: biofuels :: ethanol :: biodiesel :: subsidies :: tariffs :: France ::

In a recent working paper on the impact of biofuels written for discussion by the 'OECD Roundtable on Sustainable Development' (no immediate relation with the OECD), two analysts urged governments in industrialised countries to cut their subsidies for the sector. They called for a liberalisation of the market, which will allow more efficient and competitive producers, mostly found in the poor countries of the South, to supply biofuels to world markets (previous post).

According to analysts, the French government is now considering a cut in the TIFF tax. However, no one from the relevant ministries was immediately available to comment.

"When taking into account commitments taken with industrial investments of close to 1 billion euros and the recent start-up of production units, we would not understand (such a move)," Jeanroy said. France produced 235,000 tonnes of ethanol and 631,000 tonnes of biodiesel in 2006, the French farm ministry said.

France decided to go beyond the EU target and incorporate 5.75 percent of alternative fuels by end-2008, seven percent by end-2010 and 10 percent by end-2015.

According to the latest 'Biofuels Country Attractiveness Index' published by Ernst & Young, France ranked 4th overall for biofuels, and 5th for ethanol, partly due to the strong subsidies and protectionist measures. If some of these are removed, the French ethanol sector will find it extremely difficult to compete with more efficient biofuels produced in the South (previous post).

References:
Guardian: INTERVIEW: Subsidy cuts would wreck French ethanol sector - November 19, 2007.

Biopact: FAO chief calls for a 'Biopact' between the North and the South - August 15, 2007

Biopact: GBEP calls for a Biopact: US/EU must open markets for biofuels from the South - November 13, 2007

Biopact: IISD report challenges EU biofuel subsidies, calls for end to tariff - October 04, 2007

Biopact: Paper warns against subsidies for inefficient biofuels in the North, calls for liberalisation of market - major boost to idea of 'Biopact' - September 11, 2007

Biopact: US tops Biofuels Country Attractiveness Indices for Q2 2007 - September 18, 2007

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FuelCell Energy sells three biogas fuel cells to EMWD: low emissions, high efficiency, renewable fuel

FuelCell Energy, Inc., a manufacturer of high efficiency, ultra-clean power plants for commercial, industrial and utility customers, today announced the sale of three DFC300 power plants to Eastern Municipal Water District (EMWD) in California. The Direct Fuel Cell (DFC) power plants will supply 750 kilowatts (kW) of the electricity needed to run the EMWD wastewater processing facility while reducing local greenhouse gas emissions by 10,400 tons annually.

Using anaerobic digesters for biosolids treatment, EMWD generates methane gas. The DFC power plants will purify 100 percent of this gas and use it for fuel. DFC units do not burn fuel, but transform it electrochemically into hydrogen, water and electricity (previous post and here). Because no combustion is involved and because the units are more efficient than traditional power plants, DFC fuel cells emit near-zero pollutants and much less CO2 than other power generators in their size class. DFC fuel cells' low emissions will also help the District meet California's CARB 07 requirements - some of the most stringent in the U.S.

Unlike other fuel cell products, DFCs internally reform readily available fuels such as natural gas and biogas into the hydrogen gas required to power the fuel cell system. This internal reformation process is a key ingredient to the DFC's ability to operate at high electrical power generation efficiency. Internal reforming is possible due to the relatively high operating temperature (650-750°F) of the DFCs. This operating temperature has other advantages: non-precious metals can be used for the anode and cathode instead of platinum, resulting in significant cost savings. Also, the exhaust from the system is high-grade heat, capable of supporting a variety of heat recovery options, including steam generation.

The power plant consists of three subsystem sections: electrochemical fuel cells that produce the DC power, Electrical Balance of Plant (EBOP) section that converts the DC power into high quality AC power and the Mechanical Balance of Plant (MBOP) section contains the process equipment that prepares air, fuel, and water for use in fuel cell stack module (schematic, click to enlarge).

Fuel and water are heated to the required fuel cell temperature in a heat recovery unit (HRU), which transfers heat from system exhaust gases.The heated humid fuel stream is sent to the fuel cell stacks where the fuel is converted to hydrogen, most of which is used in the electrochemical reaction. Residual fuel — i.e., fuel not consumed in the electrochemical reaction — is supplied to a catalytic reactor to heat incoming air. The heated air flows to the cathode to provide the cathode reactants (oxygen from the air and carbon dioxide from the anode reaction). Cathode exhaust gas exits the system through the heat exchanger used to preheat the fuel and water supplied to the HRU.

The fuel cells offer the benefits of cogeneration, known as CHP (combined heat and power). A bottoming process, in that heat can be extracted in the production of electric power, cogeneration using fuel cells can represent a significant opportunity to increase the efficiency of the power plant. The power plants have an exhaust temperature ranging from 650°C to 750°F. This heat energy can be captured to provide heat for buildings, swimming pools, and other facility needs. Alternatively, the heat can be turned into cold, as one Germany IT firm recently demonstrated when it took into operation a similar biogas fuel cell to power and cool its servers (previous post).

FuelCell Energy's cells operate with an electrical efficiency of 47 %, much higher than traditional fossil fuel power plants that average 30 to 35 percent. When the DFC power plant's heat is also used, system efficiency can be as high as 80%. This added efficiency results in less fuel being consumed to generate a kilowatt of power or a BTU of heat, saving money and substantially reducing greenhouse gases.

EMWD is in southern California's Moreno Valley and processes 11.5 million gallons of wastewater per day from 190,000 homes and businesses in the area. Treatment of this waste stream is an around-the-clock operation, entailing energy-intensive processes such as disinfecting effluent, removing biosolids and reclaiming usable water:
energy :: sustainability :: biomass :: bioenergy :: biofuels :: biogas :: methane :: hydrogen :: fuel cell ::

Our ability to reduce air emissions and operating and maintenance costs were key factors in our decision to install FuelCell Energy fuel cells. In looking at the alternatives, including availability of grant funding through Southern California Edison's Self-Generation Incentive Program, our engineering team determined that DFC fuel cells were a cost-effective and environmentally friendly co-generation technology that meets the needs of our critical wastewater operations. - Charlie Bachmann, Assistant General Manager of Engineering, EMWD

The EMWD power plants will also capture heat generated by the DFC fuel cells and use this thermal energy in the wastewater treatment process itself. By eliminating a boiler and the gas-fired machinery that previously were used as heat sources, the new power plant further reduces air pollution and greenhouse gas emissions.

Municipalities throughout the U.S. are struggling to deal with the need to process ever growing amounts of wastewater. We can help them handle waste more cost effectively while generating ultra-clean power more efficiently. - William Karambelas, FuelCell Energy Vice President of Business Development

Fuel cells running on digester gas are categorized as renewable in California, qualifying them for the same treatment as either solar or wind power. Unlike solar and wind power, however, DFC fuel cells operating on biogas deliver ultra-clean power 24/7, meaning less dependence on costly and polluting grid electricity. FuelCell Energy's products are gaining market share in California and currently California orders and installations represent 43 percent of its worldwide business. Wastewater treatment customers in California are 40 percent of FuelCell Energy's California backlog and installed base.

The California Self-Generation Incentive Program will provide $3.375 million for this project through Southern California Edison. Alliance Power will serve as project manager and is expected to install the three power plants in the first half of 2008.


FuelCell Energy is the world leader in the development and production of stationary fuel cells for commercial, industrial, municipal and utility customers. FuelCell Energy's ultra-clean and high efficiency DFC(r) fuel cells are generating power at over 50 locations worldwide. The company's power plants have generated more than 200 million kWh of power using a variety of fuels including renewable wastewater gas, biogas from beer and food processing as well as natural gas and other hydrocarbon fuels. FuelCell Energy has partnerships with major power plant developers, trading companies and power companies around the world. The company also receives substantial funding from the U.S. Department of Energy and other government agencies for the development of leading edge technologies such as hybrid fuel cell/turbine generators and solid oxide fuel cells.


References:
FuelCell Energy: FuelCell Energy Sells Three DFC300 Power Plants to Eastern Municipal Water District in California - November 20, 2007.

FuelCell Energy: The Direct FuelCell Advantage [*.pdf], brochure.

FuelCell Energy: Direct FuelCells White Paper [*.pdf].

Biopact: Biogas to power fuel cell power plant in city of Rialto - May 09, 2007

Biopact: German IT firm uses biogas fuel cell to power server farm - September 01, 2007

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Thailand prepares for $200 oil: conservation, rail, biofuels and biogas

At the recent meeting of the heads of state of OPEC member countries, Venezuelan president Hugo Chavez warned that oil prices would go stratospheric and could reach up to $200 per barrel if a conflict with Iran or tensions in the Strait of Hormuz were to break out. The left-wing leader's statements did not make much of an impression on the markets, because they remain hypothetical and are clearly ideologically burdened. Nonetheless, some countries take the warning seriously, and are preparing for the worst.

Speaking at a seminar on the promotion of biotechnology in Bangkok, Thailand's Energy Minister Piyasvasti Amranand acknowledged that rising political tensions in the Middle East present a major risk to global energy security. Citing the surge in oil prices to $100 a barrel from $20 five years ago, the minister said anything was possible and that a preparedness plan is now in order.

If the crude prices double from now, local retail prices would exceed 60 or 70 baht a litre. This would severely disrupt Thailand's economy. The country relies substantially on crude oil imports representing 6.5% of its GDP. Poorer oil-importing developing countries could enter an era of negative economic growth, mass unemployment and hyper-inflation, especially those energy intensive Least Developed Countries (LDCs) that spend more than 10% of their GDP on importing oil products (previous post).

One way of dealing with the problem is for the state to subsidise fuels. But Thailand's energy minister ruled out this approach and will instead step up its efforts to promote conservation, rail transport and alternative fuels including ethanol, biodiesel, natural gas and biogas.

Biogas
In its latest move, the Thai government has set aside a 4.78 billion baht (€102/$152 million) fund to subsidise biogas, obtained from anaerobically digesting agricultural and industrial waste as well as energy crops.

The programme targets the farm sector and food-processing plants that have plans to convert waste biomass into methane gas to replace cooking gas. The fund will subsidise 20% of the total costs of biogas consulting fees, construction and installed equipment for successful applicants.

More than 430 plants, poultry farms and 300 community organisations are expected to join the biogas project, which could substitute as much as 760 million cubic metres a year of fossil fuels, valued at 5.4 billion baht (€116/$172 million) a year:
energy :: sustainability :: biomass :: bioenergy :: biofuels :: ethanol :: biodiesel :: biogas :: fuel subsidies :: crude oil :: conservation :: public transport :: Thailand ::

Waste water from agricultural processing industries as well as municipal waste is used by agricultural mills and municipalities, respectively, to produce biogas.

Palm oil and tapioca mills build biogas systems as part of their wastewater treatment and use the biogas produced to replace fuel oil or LPG consumption or to produce electricity.

To strengthen energy security and sustainability, the Thai government has set 2011 as the target date for 8% of the nation’s total energy, representing an estimated 1,900 MW, to be generated from renewable energy sources.

Conservation, public transport and improved efficiency are obviously on the radar as well, with the government considering the option of taking money from the State Oil Fund to promote these measures:

Freezing or intervening in prices of retail petrol is only a short term solution to the problem. If we don't begin to take energy conservation seriously, the country will continue to face this oil crisis over and over again. We will speed up energy-saving campaigns and expedite the construction of public transport systems such as railway lines using money from the State Oil Fund. - Piyasvasti Amranand, Thailand's Energy Minister

Commenting on the fears for economy-wrecking oil prices, Bangchak Petroleum executive Yodpoj Wongrakmit noted that while a price of $200 a barrel for refined oil could not be ruled out, the West would likely resort to economic sanctions rather than a full-fledged war against Teheran. Bangchak will consider increasing its retail oil prices across the board before this weekend since the current gross margin of 0.65-0.70 baht a litre is below the appropriate level of at least 0.70-0.80 baht a litre.

Picture: biogas plant under construction at the Nong Bua pig farming company, located to the south of Bangkok, Thailand.

References:
MCOT Thai News Agency: Global oil may hit $200 if US attacks Iran: minister - November 20, 2007.

Bangkok Post: 'No subsidy even if oil hits $200' - November 20, 2007.

Bangkok Post: Minister warns oil prices 'could' double - November 20, 2007.

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SWECO to engineer large biofuel-fired CHP plant in Finland, Metso to supply boiler

Industrial consultants from Sweden's SWECO have been awarded a major contract in connection with the construction of a new biofuel-fired Combined Heat and Power (CHP) plant north of Helsinki, Finland. Global engineering firm Metso announced it was chosen to supply a €25 million boiler to the project.

The CHP plant will be built in Kerava, a city of 30,000 inhabitants some 30 kilometers north of the capital of Helsinki. The power station will be fired with biomass fuels and will combine electricity and thermal production, covering about 75 per cent of district heating requirement in the city of Kerava. The plant is scheduled for completion in the autumn of 2009. With this investment, energy production for the city will be efficient and environmentally friendly by reducing the CO2 emissions.

The power boiler (73 MWth) will utilize bubbling fluidized bed technology to burn woody biomass (forestry residues) and peat.

SWECO's contract is of the EPCM type (Engineering, Procurement, Construction and Management) and gives SWECO's consultants total responsibility for all planning and design of the plant, from project management and structural engineering to mechanical engineering, piping systems and automation:
energy :: sustainability :: biomass :: bioenergy :: biofuels :: forestry :: CHP :: district heating :: Finland ::

The project has been ordered by the newly established energy company Kerava Lämpövoima Oy, which is owned by the Finnish energy company Pohjolan Voima Oy.

It will employ around 40 full-time consultants from SWECO for one year.

Metso is a global engineering and technology corporation with 2006 net sales of approximately €5 billion. Its more than 26,000 employees in more than 50 countries serve customers in the pulp and paper industry, rock and minerals processing, the energy industry and selected other industries.

References:
Metso: Metso supplies a power boiler to Keravan Lämpövoima's new combined heat and power plant in Finland - November 19, 2007.

SWECO: SWECO to plan new biofuel-fired CHP plant in Finland - November 19, 2007.

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