Study shows possibility for biomethane to meet three percent of transport fuel requirements in 2020

On the order of Elering, a study into promoting the usage of biomethane was completed as part of the preparatory work for the national action plan. The study, which was focused on the transport sector, foresaw the possibility of replacing three percent of the fuel used in the sector with biomethane by 2020. 

“The development of biomethane gas is important for the development of the Estonian gas economy and making the energy sector more reliant on renewable sources. Although we have viewed gas as an imported fossil fuel for years, in the future gas may be much more of a local renewable fuel,” explained Chairman of the Elering Board, Taavi Veskimägi, on the importance of the field.

In order to meet the objectives suggested in the study, biomethane usage in the transport sector must increase to 36 million cubic metres. “Biomethane prices must be cheap compared with other fuels, while at the same time covering costs for biomethane producers, vehicle dealers and fuelling station operators and providing an acceptable return. In order to help bring biomethane to market, there is no alternative but the creation of support schemes that would promote both biomethane production and consumption,” noted Veskimägi.

The study proposes 12 cost-effective and practical measures to develop the biomethane market. Firstly, the economic viability of biomethane production and consumption needs to be improved, and thereafter the market must be expanded. Support is needed for the construction of biomethane fuelling stations and for the connection of biomethane producers to the gas network. At the same time, a support system for biomethane producers must be implemented in order to ensure that biomethane can compete with natural gas. 

In order to allow fuel retailers to use biomethane to meet their mandated renewable energy objectives, a system for certification of origin of biomethane will have to be implemented.

In order to develop the market, all parties involved in the biomethane sector will need to be connected to a single network to support information exchange and cooperation, and thereby the formation and development of business opportunities.

A national plan for biomethane use in transport will be drafted, where objectives, rules and conditions for investment in the sector are set out. A biomethane fuel station strategy is needed in which the optimal density and locations of fuel stations are set out, among other things. According to the study, the development objectives of the biomethane market must also be taken into account during the public tender process. To this end, criteria for public transport procurement must be worked out so that vehicles running on methane are able to compete with vehicles using other fuels.

The biomethane study was carried out by ECN and Energy Valley from the Netherlands, Energiforsk of Sweden, and Estonian company Balti Biometaan. The study was prepared in close cooperation with the Estonian Ministry of Communications and Economic Affairs. The study and related materials are available on the Elering website.