With the government’s Committee on Climate Change recommending a ban on biodegradable waste entering landfill by 2025, landowners and investors are being encouraged to capitalise on anaerobic digestion (AD) to process biodegradable waste.
The Committee’s latest report, ‘Net Zero – The UK’s contribution to stopping global warming’, outlines that in order to reach net-zero emissions by 2050, a major expansion of renewable and low-carbon power generation is required, alongside the diversion of biodegradable waste from landfill.
“AD can play a pivotal role in helping the UK to achieve net-zero emissions by 2050,” says Phil Gerrard, CEO of specialist energy from waste funder, Privilege Finance. “Not only does AD process biodegradable waste, reducing the associated emissions from landfill, it can also contribute substantial levels of low-carbon energy to the grid. There is significant scope for expansion of national AD infrastructure.”
The report highlights that many of the technologies and policies needed to meet these ambitious emission targets are already available in the UK, but more urgent action and support is needed at government level.
“AD technology has been proven over the last decade, and is one of the only renewable technologies that can provide energy 365 days of the year,” says Phil. “We hope to see policy changes in light of this report that will support the future of the AD industry as a significant contributor to the UK bioeconomy.”
Privilege, the specialist asset-backed direct lending fund of the Prestige Funds/Prime Group of companies, announced on June 11 it had agreed a GBP 22.7 million funding deal for the construction of a 3 MW gas to grid anaerobic digestion (AD) plant in the North East of England. The plant will be powered by feedstock waste from farms around Newcastle, Sunderland and Gateshead.
It means the group’s new lending into the AD sector has hit GBP 60 million since the turn of the year.
Craig Reeves, founder of Prestige, says, “We are very pleased to be playing a continuing role in the financing of important green energy projects around the UK. Private finance represents a critical source of capital for the transformation of the country’s clean energy generating capacity, replacing more traditional sources of commercial finance. We expect that UK and overseas investors will continue to play an important role in Britain’s green revolution.”
The funders believe the climate is right for investors as smaller businesses in rural areas of the UK, including farms, are turning to alternative energy sources to help them cope with rising electricity prices and the fact that it is increasingly recognised that biogas plants will help the UK government to meet its goals under the Paris Climate Change Agreement.
Chris Winward, Chief Commercial Officer at Privilege Development Finance, adds: “We have seen a dramatic growth in the number of operational anaerobic digestion plants around the UK in the last six years. We estimate that over a million homes now receive power from AD plants.
“Rising electricity prices in the UK and higher taxes on landfill are causing agri businesses to turn to green energy projects as a source of on-farm energy, utilising existing waste. The UK government also needs to source more clean energy to meet its Paris Climate Change Agreement commitments.”
In January 2019 the UK government announced plans to organise dedicated food waste distribution nationwide, stating its preferred option is for it to be sent to AD. Universal food waste collections for households alone could achieve a carbon saving of up to 1.5 million tonnes of CO2 equivalent per year, according to ADBA. This is the same as taking 750,000 cars off the road.
Further reforms are expected to release between GBP 150-300 million of investment into AD plants in the UK over the next year, which should help to bring up to a further 30 plants online.
Phil Gerrard will be speaking at the UK AD & World Biogas Expo on July 3rd and 4th, where Privilege Finance will also be exhibiting and welcoming discussions with investors and operators.
How to design separate food waste collections to optimise both public engagement and outputs from AD will be addressed by an international panel of experts in the Circular Cities Theatre.
The future for on-farm AD will be addressed in the Future Farming theatre.
You can see the agendas here http://www.biogastradeshow.com/2019topicsandkeyfeatures/