Biogas plants: Manure and co. should only be stopgap solutions in the future

Simply explained

Biogas was once considered a miracle weapon against climate change. Anyone who built a plant in which they fermented biomass into gas (methane) and used it to generate electricity and heat received a fixed, generous feed-in tariff. The Renewable Energy Sources Act (EEG) has guaranteed this since 2000.

Farmers in particular were caught in a gold rush and invested heavily. They were happy to run their power plants around the clock, regardless of whether they needed electricity or heat – the cash registers rang. To do this, they grew huge amounts of energy corn, which is the feed for their power plants. In some areas, the monocultures stretched as far as the horizon. But then criticism arose, and the EEG was changed in 2012: Since then, operators have had to market their energy directly and receive bonuses for flexibility. The boom ended.

After 20 years, EEG funding is now running out for many operators. The biogas industry has been putting pressure on the federal government for years, especially on Robert Habeck’s Ministry of Economic Affairs: they fear that the current marketing process will put many operators out of business, even though they are so important for Germany’s climate goals.

And lo and behold. Habeck suddenly wants to reform the funding. But is that the right step? And can biogas really help protect the climate?

How much energy do biogas plants produce?

There are currently almost 10,000 biogas plants in operation in Germany. They are powered by liquid manure, dung, wood and other renewable raw materials. Together they produce almost nine gigawatts (GW), which corresponds to the output of around six nuclear power plants. Biomass for the power plants is grown on around 1.35 million hectares nationwide, mainly corn, but also grain. In 2023, around 42 terawatt hours of electricity were produced from biomass, which corresponds to nine percent of the total electricity volume. Around ten billion kilowatt hours (kWh) flowed into the natural gas grid, processed into biomethane. 1.4 billion were used as fuel, around one billion kWh to generate heat and hot water.

What do environmentalists think about biogas?

Environmental protection associations are critical of biogas. One example is the Nature Conservation Association (Nabu). One reason is the high demand for energy crops. Cultivating these is inherently harmful to the climate, say critics. Biogas plants should only be built where heat is needed locally. And if at all, they should only be a reserve source of electricity in case the wind is not blowing or the sun is not shining. The Nabu considers processing biogas into biomethane for the natural gas network to be largely useless. Biomethane could even have a worse ecological balance than fossil natural gas if the entire production chain is considered.

Why are biogas plants no longer profitable?

First of all: They can be quite lucrative. But if you are a biogas plant operator and you no longer receive a fixed feed-in tariff from the EEG, you have to market your energy yourself. That is not easy. The federal government had put out a tender for a funding volume of 240 megawatts (MW) of power for 2023, and bids for 742 MW were submitted. The offer was therefore three times oversubscribed. Now many power plant operators fear they will be left behind. The industry is warning that two thirds of the providers are facing closure.

What does Habeck want to change?

The Minister of Economic Affairs, who spoke out against biomass in the spring, is now planning significant changes to the reformed Energy Industry Act. In doing so, he is siding with the industry and environmentalists. He wants to particularly support those biogas plants that contribute to a stable green energy supply. For example, those that are connected to a heating network or that feed electricity flexibly to compensate for so-called dark periods (no wind, no sun). This means that money is only available when electricity is needed. This can be financially attractive. Power plant operators should therefore be given the opportunity to switch from the old EEG funding system to the new one.

Do Habeck’s plans make sense?

The biogas industry and many environmental protection associations support the idea in its core. The increased desire to no longer distribute subsidies indiscriminately, but to link them to a service that makes sense for the energy transition, is definitely correct.

Is there still potential for biogas?

There are major concerns among the population and experts about the use of renewable raw materials, such as corn, rapeseed or grain. The expansion would not be politically feasible. According to industry sources, however, much more organic waste could be fermented and used as an energy source. The Biogas Association speaks of almost twelve million tonnes per year. Five million from organic waste bins, 5.7 million from garden and park waste, 1.1 million tonnes from kitchen, canteen and market waste. According to the association, this could be used to generate electricity for over three million households in biogas plants. However, neutral observers believe the figures are exaggerated.

Is a new biogas boom imminent?

This is not to be expected. On the contrary. According to the current EEG, bioenergy with an output of 8.6 GW should be available throughout Germany by 2030. As of today, this figure is already nine GW. The target has therefore already been exceeded. However, it cannot be ruled out that the target value will be revised upwards at some point.