resources Article Biomethane: A Renewable Resource as Vehicle Fuel Federica Cucchiella ID , Idiano D’Adamo * ID and Massimo Gastaldi ID Department of Industrial and Information Engineering and Economics, University of L’Aquila, Via G. Gronchi 18, 67100 L’Aquila, Italy; [email protected] (F.C.); [email protected] (M.G.) * Correspondence: [email protected]; Tel.: +39-0862-434464 Received: 8 September 2017; Accepted: 20 October 2017; Published: 22 October 2017 Abstract: The European Union (EU) has set a mandatory target for renewable fuels of 10% for each member state by 2020. Biomethane is a renewable energy representing an alternative to the use of fossil fuels in the transport sector. This resource is a solution to reach this target. Furthermore, it contributes to reducing carbon dioxide emissions, gives social benefits and increases the security supply. Sustainability is reached also when the economic opportunities are verified. This work studies the profitability of small plants of biomethane, which is sold as vehicle fuel using the Net Present Value (NPV) and Discounted Payback Time (DPBT). The paper shows in detail the method used for the economic assessment of two typologies of feedstock recovered: (i) municipal solid waste and (ii) agricultural waste. Detailed information about the various parameters that affect the profitability of biomethane is given, and several case studies are analyzed as a function of two variables: subsidies and selling price. The results support the commercialization of small-scale plants, reducing also several environmental issues. The role of subsidies is strategic, and the profitability is verified only in some case studies. Keywords: biomethane; economic analysis; subsidies; sustainability; waste management 1. Introduction A circular economy is based on the principle of maintaining the value of products, materials and resources as long as possible, minimizing waste and resource use [1]. At the end of its life, a product can be recovered to create further value [2]. Biogas is the product of anaerobic digestion beginning from several feedstocks, such as agricultural residues (e.g., manure and crop residues), energy crops, organic-rich waste waters, the organic fraction of municipal solid waste (ofmsw) and industrial organic waste [3]. Biomethane is obtained from properly-treated biogas through the process of purification [4]. In the last few decades, biomethane has achieved a significant importance in the field of Renewable Energy (RE) [5]. The evolution of the numbers of upgraded plants in Europe has grown from 187 in 2011 to 435 in 2015. It is the most significant market in the world (90%) (Figure1)[ 6]. However, biomethane production is highly localized in a few countries, and this represents a great limit for this market [7]. Biomethane has properties potentially equivalent to methane and can be used directly as vehicle fuel, or be injected into the natural gas grid, or be converted into electricity and heat in cogeneration units [8]. Current technologies of biomethane consume less than about 20% of biogas energy for upgrading and compression aims [9]. A review of this topic underlines innovative and highly effective technologies along the whole chain of biomethane production [10]. Among several feedstocks used, the application of a multi-criteria analysis underlines the advantageous linked to the use of organic waste [11]. A comprehensive analysis of agricultural waste highlights also its strategic role in a circular economy model [12]. Resources 2017, 6, 58; doi:10.3390/resources6040058 www.mdpi.com/journal/resources Resources 2017, 6, 58 3 of 13 ∗ 3 ∗ 3 ∗ 3 Notes: Min p = 0.1384 €/m ; Avg p = 0.1722 €/m ; Max p = 0.2397 €/m . Profitable cases are shown in bold. Table 3. Discounted Payback Time (DPBT) (y) for ofmsw substrate. 50 m3/h Plant 100 m3/h Plant 150 m3/h Plant ∗ ∗ ∗ ∗ ∗ ∗ ∗ ∗ ∗ CIC Min p Avg p Max p Min p Avg p Max p Min p Avg p Max p 200 € >20 >20 >20 >20 >20 >20 >20 >20 >20 250 € >20 >20 >20 >20 >20 >20 >20 >20 >20 300 € >20 >20 >20 >20 >20 >20 >20 >20 >20 350 € >20 >20 >20 >20 >20 >20 >20 >20 3 375 € >20 >20 >20 >20 >20 >20 >20 4 2 400 € >20 >20 >20 >20 >20 >20 4 3 2 450 € >20 >20 >20 >20 >20 3 2 2 1 500 € >20 >20 >20 3 2 2 2 1 1 550 € >20 >20 >20 2 2 1 1 1 1 600 € >20 >20 >20 2 1 1 1 1 1 ∗ 3 ∗ 3 ∗ 3 Notes: Min p = 0.1384 €/m ; Avg p = 0.1722 €/m ; Max p = 0.2397 €/m . Profitable cases are shown in bold. Resources 2017, 6, 58 2 of 13 Germany 188 Sweden 61 United Kingdom 50 Switzerland 35 USA 25 Netherlands 24 France 20 Rest of the world 16 Austria 13 Denmark 12 South Korea 11 Finland 10 Norway 8 Japan 6 Italy 6 Figure 1. Number of upgraded plants worldwide in 2015 [6]. Figure 1. Number of upgraded plants worldwide in 2015 [6]. The biogas-biomethane chain is able to tackle the environmental pollution as an alternative to Biomethane has properties potentially equivalent to methane and can be used directly as vehicle the consumption of natural gas [13]. GHG emissions of vehicle powertrain systems are recorded from fuel, or be injected into the natural gas grid, or be converted into electricity and heat in cogeneration the Well To Wheel (WTW). According to the DENA (Deutsche Energie-Agentur) study, methane or units [17]. Current technologies of biomethane consume less than about 20% of biogas energy for CompressedResources 2017, 6, Natural 58 Gas (CNG) has a reduction potential of the order of around 21% and 24%4 of in13 upgrading and compression aims [18]. A review of this topic underlines innovative and highly comparison to diesel and petrol, respectively. The use of biomethane is able to reduce emissions effective technologies along the whole chain of biomethane production [19]. Among several further.called BIO This‐CNG value (20%)). is equal Instead, to 24when gCO pure2eq/km, biomethane if CNG (also is composed called BIO also‐CNG by (100%)) 20% of is biomethaneused, WTW feedstocks used, the application of a multi‐criteria analysis underlines the advantageous linked to the (alsoemissions called are BIO-CNG equal to (20%)). 5 gCO2eq/km Instead, (Figure when 2) pure [23]. biomethane (also called BIO-CNG (100%)) is used, use of organic waste [20]. A comprehensive analysis of agricultural waste highlights also its strategic WTW emissions are equal to 5 gCO2eq/km (Figure2)[14]. role in a circular economy model [21]. The biogas‐biomethane chain is able to tackle the environmental pollution as an alternative to 164 156 the consumption of natural gas [22]. GHG emissions124 of vehicle powertrain100 systems are recorded from the Well To Wheel (WTW). According to the DENA (Deutsche Energie‐Agentur) study, methane or 5 Compressed Natural Gas (CNG) has a reduction potential of the order of around 21% and 24% in comparison to diesel and petrol, respectively. The use of biomethane is able to reduce emissions Petrol Diesel CNG BIO‐CNG(20%) BIO‐CNG(100%) further. This value is equal to 24 gCO2eq/km, if CNG is composed also by 20% of biomethane (also Figure 2. Well To Wheel (WTW) GHG emissions in gCO2eq/km [23].CNG, Compressed Natural Gas. Figure 2. Well To Wheel (WTW) GHG emissions in gCO2eq/km [14].CNG, Compressed Natural Gas. For this reason, a policy support for biofuels is justified [24]. Changes in the legal framework had Fordirect this impacts reason, on a policy their supportdevelopment for biofuels [25]. Furthermore, is justified [15 ].European Changes countries in the legal can framework reduce their had directreliance impacts on natural on their gas developmentimports [26], reaching [16]. Furthermore, also renewable European targets countries [27]. can reduce their reliance on naturalThe economic gas imports feasibility [17], reaching of biogas also plants renewable is well targets defined [18]. in the literature [28], but also, the analysisThe of economic biomethane feasibility production of biogas is analyzed plants is well for several defined final in the uses literature (fed into [19], the but grid, also, destined the analysis for ofcogeneration biomethane or production sold as vehicle is analyzed fuel) [13]. for several However, final there uses (fedare several into the approaches. grid, destined for cogeneration or soldIn asfact, vehicle the economic fuel) [20]. impact However, of thereupgrading are several can be approaches. evaluated varying the quantity of biogas processedIn fact, and the the economic technology impact used of[29]. upgrading The biomethane can be cost evaluated of production varying is the 0.54 quantity €/m3 injected of biogas into 3 processedthe grid and and 0.73 the €/m technology3 as transportation used [21]. fuel The [30]. biomethane The discounted cost of production total cost for is 0.54 the €organic/m injected fraction into of 3 themunicipal grid and solid 0.73 waste€/m (ofmsw)as transportation substrate fuelvaries [22 from]. The 0.46–0.82 discounted €/m total3, while cost it for is equal the organic to 0.49–0.76 fraction €/m of3 3 3 municipalfor a mixed solid substrate waste (ofmsw)(maize and substrate manure varies residues) from 0.46–0.82[13]. €/m , while it is equal to 0.49–0.76 €/m for aThe mixed EU substrate project (maize“Record and Biomap” manure defines residues) that [20 ].it is relevant to propose solutions to make biomethaneThe EU production project “Record profitable Biomap” also at definessmall‐ and that medium it is relevant‐scale biogas to propose plants. solutionsLiterature to analysis make biomethanehas shown attention production to profitablethis topic also[31]. at A small- previous and analysis medium-scale underlining biogas the plants. profitability Literature of analysis ofmsw hassubstrate shown is attentionverified with to this the topic following [23].