Biomethane Review of UK activity

Alan MidwinterSGN Project Manager

29th September 2011Wardell Armstong LLP

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Who are SGN?

• Scotia Gas Networks –Formed in June 2005 following the acquisition of two gas distribution networks from National Grid (Scotland and South of England)

• Owns and operates the second largest gas distribution network in the UK.

• Serving over 5.8 million customers

Why gas networks here?

DECC 2050 Pathways Study Demonstrated that substantial electrification of heat and transport is required in order to meet 2050 Targets (80% GHG emission reduction)

What is the future for the gas networks ?ENA Gas Futures Group commissioned Redpoint to develop future gas scenarios to 2050 and beyond :-

• Retaining gas infrastructure could be up to £700bn cheaper to UK plc than a complete electrification solution

• Require low carbon renewable gas (BIOGAS) for Bio-methane • Potential for Bio-methane injection - 50% of UK domestic heating load

DECC output targets for bio-methane are 7TWh p.a. by 2020 and could extend to 150-210 TWh per annum of renewable gas by 2050

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Gas Futures Redpoint

Pathways involving

significant

Biomethane to Grid Injection

•Green Gas

•Gas Versatility

‘Green Gas’ Incentive

Low Carbon Energy - Biogas• UK produces 16 million tonnes of food waste (8 million tonnes from households) and

90 million tonnes of animal waste annually with the majority going to landfill.

• Organic material degrades producing methane gas, 23 times more damaging to the environment as a greenhouse gas than carbon dioxide.

• EU landfill directive obliges local authorities to send less biodegradable waste to landfill, generating requirement to recycle or reprocess.

• Anaerobic Digestion (AD) is a waste treatment process for organic waste, recovering energy from waste in the form of biogas (50% to 65% methane)

• Biogas traditionally has been used for Electricity generation but can be cleaned for Biomethane injection or used as CNG for vehicle fuel.

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Government Incentives

• UK Government is committed to meet Greenhouse Gas Emission targets• 15% reduction by 2020• 80% reduction by 2050

• Landfill taxes – increasing to £80 per tonne.

• Energy recovery potential for AD could support 2,100 AD plants (50,000 t) will be required.

• The Government has incentive schemes for the use of Biogas as a low carbon energy

• Existing incentives FIT’s & ROC’s for electricity generation• RTFO’s for vehicle fuels

• Government has now incentivised a scheme that will for the first time provide long-term guaranteed financial support for renewable heat installations

• Renewable Heat Incentive (RHI)

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RHI & Bio-methane Injection

• Introduction of the RHI (July 2011) provides a sound economic pathway for gas injection into the grid, financially attractive above 500 m3/h bio-gas (300 m3/h biomethane).

• Bio-methane RHI tariff is currently 6.8p / kWh

• 20 year tariff to include capital cost for all plant

• Degression of RHI tariff will feature once target volume is reached

• Bio-methane injection is 50% more efficient than electricity only applications

• Important contribution to a stable and reliable energy supply

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Comparative Income

Biogas Plant Capacity m33/hr

£/m

Didcot - The Objectives

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Project time-line

• SGN commissioned Feasibility study in April 2009

• Project Approval April 2010• 3 October 2010 SGN, working with

our partners, Thames Water and Centrica, delivered the first Bio-methane gas to Grid in the UK

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Key Objectives

• SGN used Innovation Funding to deliver a number of important objectives:

• Understand Legislative and Regulatory issues• Improve understanding in relation into gas quality (Oxygen and

siloxanes in particular)• Understand the impacts of bio-methane on the operation and

configuration of the local gas network• Prove biogas clean-up and upgrading technology in the UK• Provide a ‘base-line’ for gas quality monitoring and associated

equipment from which lower cost options could be developed• Share Project learning and improve efficiency to the benefit of future

schemes

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Regulatory Requirements

• Safety (HSE)• Transporters may only Transport gas that complies with

provisions of Gas Safety Management Regulations (GS(M)R)• Gas Transporters are obliged (by the Regulations) to take

sufficient measures to confirm that gas is compliant or must not allow gas to flow

• Commercial (Ofgem and the Uniform Network Code)• The bio-methane must have its energy measured in

compliance with Gas Thermal Energy Regulations• The processes must comply with appropriate UNC

arrangements

Gas Quality Baseline

• Establish Biogas composition and available flow-rate• Ensure the local SGN Network could accept the

volume of gas that will be produced on a 24/7 basis• Establish biomethane gas quality requirement,

specifically around :• Oxygen• Siloxanes• Calorific value

• Identify appropriate biogas clean-up and upgrading technology for Didcot

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Key Objective Outputs

• Oxygen content could potentially be up to 2%• HSE derogation would be required for >0.2%

• Siloxanes were likely to be present in the biogas• Additional filtration equipment would be required

• The calorific value from the bio-methane would be lower than the existing network values

• Enrichment with propane would be required

• Costs were likely to be high – SGN IFI Funding used• The project could be implemented in 2010 and would

therefore provide valuable learning ahead of RHI introduction in 2011

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How can AD Biogas become Bio-methane

• Bio-gas from an anaerobic digester contains typically

• Natural gas contains around 90% methane, with ethane, propane, butane, CO2 and nitrogen making up the rest.

• To inject Biogas into the gas grid it is necessary to clean it and upgrade it to biomethane

• Bio- methane is around 98% methane content

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Methane = 55 – 65% CO2  = 35 – 40% O2 = 0.1 – 0.5%

N2 = 0.5 – 2% H2S = 200 – 2,000 ppm Siloxanes (sewage only)

The Didcot Project

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Didcot Project – Before injection (April 2010)

Digester Gas Bag Flare

Why Didcot ?

• Existing Sewage Treatment Works with 2 Digesters producing sufficient waste biogas

• Thames Water interested in the SGN proposition to clean up the biogas, upgrade and inject into

the local SGN grid

• Practical details:• Resilient local Network within 400m of site• Available space• Unlikely to have issues with planning authorities

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Didcot – The ‘GREEN’ Gas process

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Biogas

Biomethane

Biogas Clean-up and upgrading Plant

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Site Location

Location of New Plant

Connection to Gas Network

Residential Area that will use new

gas supply

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Biomethane – The Process

ADGas

Storage

Flare

Bio-gas Clean Up Plant

(Water Wash)

Bio-methane to Grid Entry Equipment

(Network Entry Assets)

Existing Gas Network

Out of Spec Bio-methane

Gas Engines

Network Entry

Valve (ESD)

Network Connection

Bio-methane

97-98% BioCH4

0.3% O2

Typical Bio-gas

60-65% CH4 34-36% CO2

1% O2

Propane Upgrade

CO2 Filters

AD

Electricity Output

Site Layout

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Water Wash Process

Plant

Water Wash Process

Plant

Propane Storage and Blending PlantPropane Storage and Blending Plant

Biomethane to Grid PlantBiomethane to Grid Plant

Gas Analysis equipmentGas Analysis equipment

Filters for Siloxanes and H2S

Filters for Siloxanes and H2S

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Didcot Project (Apr – Oct 2010) First Biomethane to grid plant in UK

DIGESTERS

GAS STORAGE

CLEAN UP PLANT

CUSTODY TRANSFER STN

UPGRADE PLANT -

PROPANE

TELEMETRY

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Biogas Clean-up and Upgrading Equipment• Established Water scrubbing

technology• Removes CO2

• Removes H2S• Removes most siloxanes• Dries the biogas

• Additional filtration to ensure no siloxanes enter network

• H2S captured when it is removed from the water and not vented to atmosphere

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Propane Enrichment

Propane Storage Tanks

Mixing Vessel

Propane Tanks refilled by Tanker every 3 to 4 weeks

Industry Review Group (GDNs, shippers, REA, Ofgem)

Sept-Oct 2010 agreed that adding propane to meet FWACV was necessary to ensure customers were not being disadvantaged by bio-methane injection

Biomethane Injection – Equipment and Regulations

Gas Transporter must ensure :- Regulation Requirement

Gas Quality Measurement GS(M)R Reg 8 Schedule 3 pt 1

Pressure Control of gas delivery into network GS(M)R & PSSR

Stenching Agent injection GS(M)R Reg 8 Schedule 3 pt 1

Volume Flow Measurement GS(M)R & Gas (Calculation of Thermal to enable calculation of gas quality Energy ) Regs

Gas Flow weighted average CV to OFGEM Direction under the 1996 Gas measure/record the energy of the gas (Calculation of Thermal Energy ) Regs

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COMPLIANCE -Telemetry to monitor & record to Gas Control Centre

SHUTDOWN - Emergency Shutdown System (ESD)

• Key considerations that the project had to recognise -

• Charge to Consumers CV • Consumer Safety H2S & Wobbe Number • Network Integrity Water dewpoint & Oxygen

(internal corrosion)

• Existing Constraints

• Currently only one OFGEM approved device (Danalyser)• Siemens Microbox (FWACV hardware – supervisory software)• Total sulphur & H2S measurement (MAXUM)• Hydrocarbon dewpoint measurement • High Pressure Metering Information System (HPMIS)

Gas Network Considerations

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HSE - GAS SAFETY – GS(M)R Fast Acting and Shut Off ( ESD)

Emergency Shut Down System Fast acting gas qualitysampling equipment

(H2O, H2S, S, CV, H2, O2 , etc)

GAS SAFETY – Stenching Agent

Odorant injection system

3131

GAS SAFETY - Pressure Control & Metering

Accurate flow measurement

Pressure control – entry into 2 bar MP

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OFGEM - Thermal Energy

SGN as the gas transporter were Directed by OFGEM to use an approved type Danalyser ( Gas chromatograph) that enables highly accurate sampling.

Accurate to around 0.14 MJ/M3 (less than 0.4% error)

Accepted that this is an expensive solution but there was no alternative for Didcot 2010

700 Series Danalyser

33Biogas clean-up and upgrading plant

Propane Storage

Digesters

Gas bag

Energy and quality Measurement, odorant addition, telemetry to Gas Control Centre

Propane mixing and injection Thames

Water control room

H2S and Siloxane filters

Completed Project (1)

Project at Completion

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Project at Completion (2)

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Project at Completion (3)

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Project Learning

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Successes – All in it together!!

• Bio-methane quality of clean up plant established

• Propane requirement less than anticipated

Co-operation of Regulatory Bodies

HSE - Positive support for 2% Oxygen exemption

OFGEM - Timely Letter of Direction - Expedited verification of Danalyser and other directed equipment

Single Party Delivery of Project

Modular Construction • Excellent H&S record on congested site• Significantly reduced construction period

Output of the Technology

• SGN lead project delivery as principle contractor supported by our technical partner CNG Services Ltd

Learning

• Location of Anaerobic Digestion - near gas grid• Capacity of the gas grid must be able to support facility• Operating pressure (IP or MP best)• Clean up technology and AD must be designed together to meet

gas and energy quality requirements – retrofit process performance difficulties

• Income balance between CHP (Fit’s) and grid injection (RHI) is attractive

• Network Entry Agreements – Must be appropriate• Measurement• Telemetry• Nominations – link to gas sales• Communication

• Design and Build Agreements – need industry standard• Maintenance • Ownership and Responsibility for Plant• Plant Redundancy / Availability

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Future Challenges for Bio-methane Injection

Technical Challenges for Biomethane Injection

Technical barriers to Biomethane growth in UK

• Oxygen content / specification - GS(M)R – is it appropriate at 0.2%?

• CV enrichment with propane – not seen as green

• Cost - Gas Quality / Thermal Energy equipment• Regulations and systems are designed for large volumes of gas.• GSMR data duplication - clean-up and network entry plant.• Increase diversity of suppliers for network entry systems

• Network Entry Agreement • Historically designed for large facilities, need to be reflective of smaller biomethane

sources.

• Network Capacity Constraints• Capacity re-engineering and suitable models to facilitate biomethane entry

• Gas Transporters Licence exemption• Class Exemption from section 6A of Gas Act for Biomethane

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Future Challenges for Biomethane Injection

Socio-economic barriers to Biomethane growth in UK

Clarity on ownership and funding for network entry equipment.

Incentives for GDN’s within next Price Control Period?

RHI degression from 2012 ?

Feedstock suitability – varied feedstock contaminants / landfill gas 2012 ?

Project Funding – (Energy from Waste AD facilities)

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Conclusions

Bio-methane could supply up to 50 % of domestic gas load here in the UK.

Bio-methane into the Gas Grid is far more efficient than into the electricity grid providing a sustainable gas supply

2020 UK Government target - generate 15% of national energy requirement from renewable sources

The Gas networks currently have the infrastructure to deliver this energy supply to the majority of our consumers .

Bio-methane injection is the best way to supply this low Carbon energy into millions of homes and businesses

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The potential is huge….. Thank you

Alan Midwinter

alan.midwinter@sgn.co.uk

www.sgn.co.uk