Economic analysis of anaerobic digestion—A case of Green power biogas plant in The Netherlands

Abstract

One of the key concerns of biogas plants is the disposal of comparatively large amounts of digestates in an economically and environmentally sustainable manner. This paper analyses the economic performance of anaerobic digestion of a given biogas plant based on net present value (NPV) and internal rate of return (IRR) concepts. A scenario analysis is carried out based on a linear programming model to identify feedstocks that optimize electricity production and to determine the optimal application of digestate. In addition to a default scenario, management and policy scenarios were investigated. Economic evaluations of all scenarios, except no subsidy scenario, show positive NPV. The highest NPV and IRR values are observed under reverse osmosis (RO) as a green fertilizer scenario. Our findings show that treating RO as a green fertilizer, as opposed to manure (default scenario), is not only lucrative for the plant but also lessens environmental burden of long distance transportation of concentrates. This paper also concludes that given the uncertainty of regulations concerning RO and the currently low values of digestate and heat, high investment and operating costs limit feasibility of anaerobic digestion of wastes of farm origin and other co-substrates unless subsidies are provided.

Effects of changes in Italian bioenergy promotion schemes for agricultural biogas projects: Insights from a regional optimization model

“…Researching further literature on biogas supply chains, traditional engineering economics approaches were found to be mainly used, e.g., to simulate the operation of single exemplary plants (Tahlegani and Kia, 2005;Gebrezgabher et al, 2010) and to determine the optimal plant size (Walla and Schneeberger, 2008;Gan and Smith, 2011) or the optimal timeliness for crop harvesting (Gunnarsson et al, 2008;Capponi et al, 2011) by repeated simulation and sensitivity analysis of continuous variables. Optimization is more often meant to improve the performance of individual biogas plants (Kana et al, 2012;Thorin et al, 2012) or sections of supply chains (Bekkering et al, 2010), rather than to analyze or design supply chains as a whole.…”

Sustainable Agro-Food Industrial Wastewater Treatment Using High Rate Anaerobic Process

“…Gebrezgabher et al [94] analyzed the economic performance of anaerobic digestion of a biogas plant using the net present value (NPV) and internal rate of return (IRR). They conclude that the uncertainty of the increasingly tightened regulations regarding the effluent of anaerobic treatment, the quality and value of the digestate and the high investment and operating costs limit the on-farm applications of anaerobic digestion of agro wastes.…”

Smart municipal energy grid within electricity market

“…Average cost of electricity produced from biogas CHP plant are calculated to 13c€/kWh el in [12]. The price of the input feedstock including transport varies from 0-175 €/t feedstock [18], for poultry, 2.5 for pig manure, energy maize 38-68 [16] and food waste of 40€/t [23]. The net costs can be calculated by subtracting the feed in premium from these cost.…”

“…The net costs can be calculated by subtracting the feed in premium from these cost. Therefore for the community a feedstock cost may also become negative [23], but this could enact a synergetic effect between agriculture and electricity from renewable energy [13]. Natural gas price of 0.3-0.4 €/Nm3 for the small consumer and 0.2-0.1 €/Nm3 at connection to the gas transport network for Republic of Serbia have been assumed.…”