User:SEBE2013/Biogas in Poland

Renewable energy
In 2009 the total energy supply from renewable energy resources (RES) amounted to 253 PJ, which is equal to 70 TWh /10/. This covered 9% of total primary energy supply in Poland in 2009. Solid biomass has the largest contribution, amounting over 86%. Other sources has a minor meaning.

Electricity production from RES in 2009 was at the level of 8.7 TWh. Electricity generated from biomass amounted to 4.9 TWh, from biogas 0.3 TWh, from wind 1.1 TWh and from water 2.4 TWh, respectively.

Heat generation from RES amounted 9.9 PJ in 2009, which is equal to 2.7 TWh. It comes mainly from solid biomass (92%). Other sources are biogas, geothermal and solar energy.Transport biofuels from RES are rapeseed biodiesel (72.55%) and sugar and starch bioethanol (27.45%). Total production of biodiesel in 2009 amounted to 336,832 tons (3.9 TWh). The consumption of biodiesel was at the level of 510,000 tons. The production of bioethanol was 127,344 tons (1.1 TWh), while the consumption was at the level of 264,297 tons. This means Poland imported biodiesel and bioethanol in 2009.

Bioenergy and biogas
Biogas production in Poland takes place mainly at the landfill and waste water plants. The sec-tor of agriculture biomass production is just starting.

Currently, there are 125 biogas plants in total. There are 6 agricultural biogas plants, 46 waste water biogas plants and 73 landfill biogas plants. The largest electric capacity is installed in the biogas plant at the landfills.

There are three types of biogas plants: (i) producing heat only, (ii) producing electricity only, and (iii) producing combined heat and electricity. The landfill biogas plants in Poland were established in different periods, some of them are relatively old. All three options take place, however the majority of plants at the landfills produce only electricity as there is no need to for heating the digester. In case of agricultural biogas plants and waste water biogas plants most of the units are combined heat and power plants. No specific data are available from the RES statistics.

The electricity production in landfill biogas plants in 2009 amounted to 0.175 TWh. For waste water biogas plants it was 0.123 TWh and 0.022 TWh from agricultural biogas plants, respectively.

There are several different studies on agricultural biogas potential assessment in Poland. De-pending on the methodology and assumptions the results range from 25 PJ (Ministry of Economy in PEP 2030) through 153 PJ (IEO 2007 for Ministry of Economy 2007) up to 486 PJ (PI-GEO 2008).

In Poland there are ca. 1,759 industrial waste water plants and 1,471 municipal waste water plants. At the end of 2009 biogas was produced only in 46 of them. There are also registered ca. 700 active landfills, most of them have no full control of landfill gas emissions. Technical potential of landfill biogas production is found in 100 biggest municipal landfills.

Agricultural biogas and landfill biogas plants are combined heat and power plants mainly. In case of wastewater biogas plants the biogas is used for heat production only or for combined heat and power production.

Main legal documents
The main legal documents relevant for energy sector in Poland are: According to the Energy Policy of Poland till 2030 the primary directions of the energy policy are : The energy policy will strive to meet the commitment contained in the EU strategies (Lisbon Strategy and EU Sustainable Development Strategy), which assume the transformation of Europe into a low-carbon economy with a reliable, sustainable, and competitive energy supply.
 * Energy Policy of Poland till 2030 (PEP 2030)
 * Energy Law,Environmental Policy till 2016
 * National Renewable Energy Action Plan (in preparation)
 * To improve energy efficiency;
 * To enhance security of fuel and energy supplies;
 * To diversify the electricity generation structure by introducing nuclear energy;
 * To develop the use of renewable energy sources, including biofuels;
 * To develop competitive fuel and energy markets;
 * To reduce the environmental impact of the power industry.

Future energy supply and demand
The projected increase in demand for primary energy would amount 4.0% till 2020 and 21% till 2030. This increase is to occur mainly after 2020 due to higher projected GDP increase in absolute terms and the introduction of nuclear power plants. There will be quite significant changes in the primary energy demand for different fuels from 2006 up to 2020

Table 3-5: Demand for primary energy in TWh in 2006 and 2020

It is expected that the final demand for electricity would moderately increase from ca. 111 TWh in 2006 to ca. 172 TWh in 2030. The demand for gross electricity would increase from ca. 151 TWh in 2006 to ca. 217 TWh in 2030.

It is projected that there will be a decrease in the number of installed capacity in coal power plants. It is necessary to build nuclear power plants. The first nuclear plant should be commissioned in 2020.

The overview of the installed electrical capacity in different types of power plants is presented in Table 3 6.

Table 3-6: Installed electric capacity in MW in different types of power plant in 2006 and plan for 2020

Targets for renewable energy
According to the EU expected requirements, it has been assumed that the renewable energy share in Poland in the final energy structure would increase up to 15% in 2020 and that the 10% share of biofuels in the transport fuel market would be achieved in 2020.

Meeting the EU objectives would require the total final gross energy consumption from renewable sources at the level of 120.8 TWh in 2020. Electricity would amount 31.2 TWh, heat 72.8 TWh and transport biofuels 16.8 TWh, respectively.

In the renewable electricity the largest contribution will come from wind power 13.7 TWh, which would account for 18.4% of total electricity generation in Poland. Bioenergy will be also an important source of renewable electricity with an expected supply of 14.4 TWh in 2020, including 4.0 TWh from biogas. Heat production will be dominated with bioenergy, with 86% of renewable heat coming from solid biomass.

Table 3-7: Gross demand for renewable energy sources in TWh in 2020 /12/

In is assumed that in Poland up to 2015 only first generation biofuels will be produced, namely bioethanol and biodiesel. In the following years second generation biofuels and biohydrogen will be introduced.

Energy infrastructure
The Energy Policy of Poland till 2030 indicates activities that have to be undertaken in the area of energy infrastructure /12/:


 * It is expected to prepare and launch the use of new deposits of coal mining.


 * In the sectors of natural gas and crude oil, it is also essential to increase transmission capacity of gas transport and storage systems and of oil and fuel pipelines, as well as their transship-ment and storage infrastructure, including cavities in salt structures.


 * Building a terminal for receiving liquefied gas (LNG).


 * Diversification of supplies by building a transmission system for natural gas supplies from the north, west, and south, as well as building connections to primarily meet the requirement of supply sources diversification;


 * Diversification of crude oil supplies to Poland, inter alia by building infrastructure.


 * Facilitation to transport crude oil from the Caspian Sea region.


 * It is necessary to build new power plants and rebuild the existing ones.


 * It is necessary to build new power grids which will enable the connection of new capacities and increasing the possibilities to exchange electricity with neighbouring countries.


 * Developing the national transmission system enabling sustainable economic development of Poland, its regions, ensuring reliable electricity supplies to agglomerations (in particular, closing the 400 kV loop and loops circling Poland’s largest cities), as well as reception of electricity from the areas with a large number of planned and newly built generation facilities, including wind farms.


 * Developing cross-border grid connections coordinated with extending the domestic transmis-sion system as well as the systems in neighbouring countries, which will allow to exchange at least 15% of electricity used in Poland by 2015, 20% by 2020, and 25% by 2030;


 * Modernization of the transmission and distribution grids to reduce failure frequency by 50% by 2030 as compared to 2005.

Regional energy plans
An important element supporting the implementation of the energy policy in Poland is an active participation of local authorities in the process of achieving its objectives, including the development of the energy sector development strategies at the province, district or commune level /12/. Besides, investment plans of communes and energy companies should be correlat-ed. The most important elements of energy policy at the regional and local level should include:


 * Aiming at fuel and energy savings in the public sector by implementing measures laid down in the National Action Plan for Energy Efficiency.
 * Maximizing the use of the local renewable energy potential, both for the generation of electric-ity, heat, cold, cogeneration, as well as for generating liquid biofuels and biogas.
 * Developing the locally centralized heating systems which allow to improve efficiency and envi-ronmental parameters of the heat supply process and to increase the local level of energy security.
 * Modernization and adjustment of the electricity distribution network to the current needs of the customers, in particular the modernization of networks in rural areas and the networks supply-ing the areas characterized by low energy consumption.
 * Expanding the natural gas distribution network in areas with poorly developed gas network, in particular in northern and eastern Poland.
 * Supporting the infrastructural investments of strategic importance for energy security and de-velopment of the country in the communes.

Laws and provisions concerning biogas production
The main legal documents relevant for the development of biogas plants in Poland are: (i) the Energy Law and (ii) the “Directions of the agricultural biogas plants sector development in Po-land in the period 2010-2020” (shortly named Biogas Programme).

The Energy Law is a legal act that was amended 8 January 2010 introducing regulations rele-vant for agricultural biogas plants. Definition of agricultural biogas was introduced as well as many important regulations for the development conditions for biogas production for energy use (heat and power production) or supply to gaseous network in Poland.

According to the Energy Law the agricultural biogas is defined as a gaseous fuel that was ob-tained in the process of methane fermentation from following feedstock: agricultural feedstock, agricultural by-products, liquid or solid animal wastes, by-products or residues of agricultural and food processing industry, or forestry biomass.

The Energy Law sets following conditions relevant to biogas production:
 * Enrolment to the registry of biogas plants.
 * Connection to the electricity grid.
 * Connection to the gaseous distribution network.
 * Remuneration schemes for biogas production

The Biogas Programme is a dedicated programme elaborated by the Ministry of Economy with the cooperation of Ministry of Agriculture to create optimal conditions for the development of biogas production in agricultural sector in Poland. The program indicates all necessary changes in law that need to be implemented to boost this sector, identifies the possible sources of financial support for biogas plants and proposes educational and promotion activities relevant for this sector. Important benefits are stated that may be reached in Poland when the pro-gramme is realized, such as contribution to the achievements of the renewable energy targets, diversification of energy supply in rural areas, supplying rural areas with gas, utilization of by-products and wastes, etc. Relevant changes has been already intruded to the Energy Law to facilitate the biogas pro-duction in Poland, however, the Biogas Programme indicates other legal documents that need to be amended to remove existing barriers and/or create favourable conditions for biogas plants development:

Currently, consultancy works are carried on the above mentioned documents in the relevant ministries to adjust the existing regulations to the requirements of the agricultural biogas de-velopment sector. For example, the Fertilizers and Fertilization Law need to be amended to include relevant conditions for the post-fermentation sludge (digestate) management.
 * Fertilizers and Fertilization Law.
 * Wastes Law.Building Law.
 * Real Estate Management Law.
 * Spatial Planning Law.

Remuneration schemes
The Energy Law sets rules for the remuneration schemes for heat and electricity production from agricultural biogas or supplying the biomethane to the gaseous grid.

A biogas plant operator who produces heat and electricity from the biogas is eligible for: Whole amount of electricity generated in renewable energy sources connected to the grid has to be purchased in Poland (obligation of purchase). This is also relevant for the biogas plants producing and supplying electricity to the grid. The guaranteed purchase tariff is at the level of the average electricity sale price in the preceding calendar year. The Chairman of Energy Regulatory Office (URE) makes an announcement on this by 31 March each year. This is a minimal price that has to be paid for the electricity generated from renewable energy sources.
 * Guaranteed minimal price for the electricity sold to the grid.
 * Income from selling the colour certificates.

The prices for the last three years /13/: Electricity from renewable energy is eligible for green certificates, therefore each MWh pro-duced from biogas is eligible for a green certificate, irrespective if it is sold to the grid or used at the place of origin. Each MWh produced has to be registered by a certify recorder at the generator terminal.
 * In 2008: 128.80 (32.20 EUR/MWh),
 * In 2009: 155.44 PLN/MWh (38.86 EUR/MWh),
 * In 2010: 197.21 PLN/MWh (49.30 EUR/MWh).

If the electricity is produced in a high efficiency cogeneration (which is the normal case for biogas plants) and the heat is used for usable purposes (for heating purposes or production purposes), the biogas plant operator can additionally get yellow or violet certificates for each MWh produced in the cogeneration with usable heat. The possibility of aggregating renewable electricity certificates with high efficiency cogeneration certificates take place only from the 1st June 2010.

The yellow certificate by definition is eligible for electricity generated from gaseous fuels or in plants of total installed capacity below 1 MWel (which commonly in both cases is relevant for biogas plants). The violet certificate is eligible for electricity produced from methane from coal mines or gas from processing biomass (the last is relevant for biogas). It depends on the biogas plants operator which, yellow or violet, certificate he will prefer.

When the green certificate is granted for each amount of electricity produced in the renewable energy source, e.g. a biogas plant, the yellow or violet certificate is granted only for the amount of electricity (generated in high efficiency cogeneration) that is bind with the amount of heat that is used for usable purposes (this is calculated according to a relevant governance of the ministry of economy).

The prices of the colour certificates are close to the substitute fees, which have to be paid by the energy companies if they do not fulfil the obligatory targets for renewable energy or high efficiency cogeneration. The levels of substitute fees relevant for the colour certificates are presented in Table 4-1.

Table 4-1: Prices of substitution fee relevant for colour certificates.


 * exchange rate: 1 EUR=4.0 PLN

The substitute fee shall be a subject to an annual revaluation using the average annual total customer goods and services price index for the calendar year preceding the year for which the substitute fee is calculated. A projection of the substitution fee for renewable electricity is presented in Figure 4-1, which is own calculation based on last three years price index.

According to current legal framework, the support system in the form of green certificates is guaranteed till 2019, for violet certificates till 2018, while for yellow certificates only till 2012.

When considering all available support for electricity produced in renewable energy sources in 2010, a biogas plant operator was granted remuneration at the maximum level of 593.96 PLN/MWh (197.21+267.95+128.80), which accounts for 148.49 EUR/MWh (49.30+66.99+32.20). This includes the guarantee price for electricity and green and yellow certificates. In the following years the most important increase would come from the prices of electricity. According to the projections made under the Energy Policy of Poland up to 2030 the price of electricity will grow by 16% till 2015 and 43% till 2020 starting from 2010 /12/. The increase in the colour certificate prices is correlated with the substitution fee levels, which are based on the annual consumer price index.

Figure 4-1: Projection of substitution fee level relevant for green certificates for renewable energy

In case the biogas plant produces biomethane to the gaseous grid the plant operator would be eligible for brown certificates. The registry of brown certificates is scheduled to be opened from January 2011. The price is expected to be at the same level as for green certificates. So far, in Poland there is no biogas plant supplying the biomethane to the grid.

The task of running a register of colour certificates and organization of trade in proprietary rights under the certificates was commissioned to the Polish Power Exchange (Towarowa Giełda Energii SA).

There is no specific support for the energy crops cultivation for biogas plants in Poland. After the abolition of the energy crop area aid of 45 EUR/ha in 2009, energy crops are not eligible for any additional payment apart from the single area payment that is available under the Common Agricultural Policy (CAP) for agricultural land.

There is no specific incentive for the use of wastes for biogas production.

Nitrate vulnerable zones
In Poland there are 21 nitrate vulnerable zones (NVZ) in six regions /16/. Total area of NVZ amounts to 6,263 km2, which covers 2% of country area, Agriculture is the main source of nitrate elution to groundwater and surface water, however the average pressure from agriculture to the environment in Poland is below that in the EU-27. The indicators of livestock density, use of fertilizers and nitrogen surplus are lower for the Polish agriculture than the average for the EU-27. Moreover, the special distribution of livestock density, fertilizer application and N surplus are quite equal on the territory of the whole country, although the agriculture is the most intensive and productive in the western part of Poland.

It was recommended that programmes for the improvement of livestock buildings and animal wastes storage shall be dedicated for large farms, which in Poland means farms over 15 ha and/or 15 LSU /16/. There are respective requirements concerning the animal wastes storage capacities.

For the manure the storage plate capacity shall be large enough for at least 6 month storage, the capacity depends on the height of the manure prism, in practice the storage capacity shall be 3.5 m2 per LSU for a 2 m high manure prism. If the manure is kept for 4 month the required capacity is 2.5 m2 per LSU.

The required storage capacity for urine is 2.5 m3 per LSU for at least 6 month storage and 2.0 m3 for 4 month storage.

The required capacity for slurry storage shall be 10 m3 per LSU for a 6 month and 7.0 m3 for 4 month storage.

The 6 month storage is a minimal required time for the NVZ, while outside these areas the minimal recommended storage time is 4 months.

Biogas plant approval procedure
The implementation of a biogas plant for operation includes 3 main stages: (1) project prepa-ration, (2) realization, (3) commissioning.

Project preparation procedure includes: It is estimated that in practice the whole process of plant establishment starting from a draft idea of the project till commissioning and the plant starting the operation will last about 3 years. The preparation of the project including all the necessary administrative procedures and finding relevant founding sources will take up to 1 – 1.5 year. Then, the realization stage (building works, installing the technology equipment, connecting all necessary media, etc.) and com-missioning the plant would last up to 2 years.
 * Preparation of a draft project;
 * Feasibility study (feedstock availability, technology choices, financial analysis, founding sources. etc.);
 * Granting the environmental decision;
 * Granting the decision on build-up terms and land use;
 * Granting the connection to the grid;
 * Preparation the construction design;
 * Granting building permit.

From the investor point of view the most important and the most crucial for the project are the administrative procedures.

The procedure of granting the environmental decision

Granting decisions on environmental conditions is regulated by the Environmental Law dated 3rd October 2008. Granting an environment decision must precede granting a building permit and decision about the terms of building up and land use. The details of the procedures in a form of a guide have been elaborated by the General Directory of Environmental Protection /17/.

Agricultural biogas plants are classified in a category of projects which may potentially have a significant environmental impact (under relevant governance dated 9th November 2004). This indicates there is a need for an environmental decision for each biogas plant.

When applying for the environmental decision the investor submits to the Commune Office (relevant to the place of the planned investment) an application form together with following documents: In the first step a screening procedure occurs. It determines whether or not the project is sub-ject to Environmental Impact Assessment (EIA). In case of biogas plants performing a full en-vironmental assessment may be considered as not obligatory. Such decision is made case by case depending on the project and its location.
 * information sheet on the project,
 * copy of the map of the area on which the project will be located,
 * extract from land record relevant for area where the project will be located and area which the project will affect,
 * extract from the Local Physical Arrangement Plan.

The authority granting the decision analyse the project from the perspective of terms relating to its characteristics, type, location and scale of possible environmental impact. The authority also consults for an opinion the Regional Director for Environment Protection and the applicable entity of State Sanitation Inspection. If they ascertain the need to conduct the EIA, they should at the same time indicate the scope of the environmental impact review (EIR). Opinions on the requirement to conduct the EIA or waiving such are expressed in form of decisions and conveyed to the authority relevant for issuance of the decision on environmental conditions within 14 days.

The administrative authority, upon receiving both opinions, takes the decision on the possible requirement for performing full EIA, in the form of a ruling. Such a ruling is to be issued with 30 days of initiating the procedure regarding the decision on environmental conditions.

Regarding the project for which there is no obligation to conduct the EIA, the environmental decision will indicate only the lack of need to carry out such a procedure. The realization con-ditions of the project that are stated in the environmental decision will be defined according to the project characteristics which, the same as project information sheet, will be appended to the decision. In such a case the full procedure of granting the environmental decision com-monly last 2-3 months, however it may differ from case to case.

If the project is subjected to go under the Environmental Impact Assessment this means an administrative procedure covering: (i) preparation and analysis of the Environmental Impact Review, (ii) public social consultations and (iii) consultations with public authorities (regional director for environment protection and sanitation inspector).

The contents and scope of the environmental impact review (EIR) is defined by the Environ-mental Law, EIR is submitted to the authority conducting the procedure on the decision on environmental conditions.

The project and the environmental impact review are consulted with the Regional Director for Environment Protection, who agrees the realization conditions of the planned project. In case of biogas plants the consultation is also carried with the Sanitary Inspection. They evaluate the EIR and prepare their opinions that should be issued within 30 days from the day of receiving all documentations unless the delay is due to the applicant (or other parties) or is due to rea-sons beyond the control of the authority. Commonly the applicant is called to make some changes or improvement to the EIR according to the request of the regional director. This may make the whole procedure prolonged.

The authority relevant for the environmental decision has to ensure public society consultation on the project including the environmental impact review. The public consultation starts with public announcement, the duration of public consultation is 21 days from the announcement. The results of public consultations are reflected in the final environmental decision issued.

Finally the environmental decision is issued based on: (i) the results of the Environmental Im-pact Assessment, (ii) provisions of the Environmental Impact Review, (iii) reservations from the public consultations and (iv) opinions given by the of regional director for environment pro-tection and the sanitary inspection.

The decision specifies the type and place of project realization along with the terms of land use in the implementation and exploitation or operation phases, with particular view to the need for protecting valuable assets of nature, natural resources and historic monuments as well as limiting the elements onerous to adjacent terrain. In addition, the requirements of environment protection has to be included (such as, ventilation, electric filters, exhaust neutralising installations, separators, sedimentation devices, etc.), which are necessary in the mandatory documentation for granting succeeding investment decisions, in particular in the construction design. At the same time, in warranted cases the authority determining the environmental conditions may impose the obligation to prevent and monitor harmful project impacts on the environment, and ensure nature compensation (when such impacts cannot be prevented).

The environmental decision is finally made public by the authority (Head of Commune).

The environmental decision is attached to the application forms for granting all other decisions required by the investor, e.g. planning permission, building permit. The environmental decision is valid within four years from the day of its final enforcement. This period can be prolonged with two years if the project is realized within several stages and unless there is no change of conditions stated in the environmental decision.

Summing up, the full procedure of granting the environmental decision, including EIA proce-dure, commonly lasts at least 6 months. It may differ from case to case and much is Depend-ant on the Regional Director of the Environment Protection. The Regional Director is respon-sible for evaluation of the environmental impact review, therefore the investor should put much attention to the content and quality of the review. This may markedly speed up the process.

Granting the decision on build-up terms and land use

When there is no Local Physical Arrangement Plan, a decision has to be granted on the terms for build-up and use of land. The application is addressed to the head of commune/mayor or president of municipality. The application has to be accompanied by: The description of the project includes in particular: (i) the demand for water and energy, the way of draining waste water or tearing it, any needs for technical infrastructure, if relevant also the way of treating wastes; (ii) description of the buildings and the management of the terrain, defining their purpose and size, presenting them in a form of graphics and description; (iii) defining and listing all technical parameters of the investment.
 * decision on environmental conditions;
 * delimitation of borders of the site/premise covered by the application, shown on a copy of local map;
 * description of the investment project.

It is recommended to comprehensively describe the guiding premises of the investment and project technical parameters. The technology of agricultural biogas plants is in its very initial phase of development in Poland, therefore exhaustive information will markedly speed up the process of issuing the administrative decision.

Granting the decision on the building-up terms and land use should last 1 month, and 2 months in more complicated cases. These periods are required by the Administrative Procedure Code. This do not include time required for completing the documentation by the investor, In some cases depending on the authority and the investment granting the decision may last 2-3 months, then the applicant is always being informed. Often it is stated that the delay is due to the need for some consultations.

Granting building permit

On light of the Building Law projects which may have significantly impact the environment and projects which may exert a significantly negative impact on Nature 2000 areas require a build-ing permit, In this context biogas plants require obtaining a building permit.

The application for granting a building permit shall be submitted to the district administration office. When biogas plants are concerned, such an application must be accompanied by: The construction design has to comply with: (i) provisions of Local Physical Arrangement Plan or decision on terms of build-up and land use; (ii) terms of the decision on environmental con-ditions; (iii) technical regulations governing construction.
 * decision on environmental conditions;
 * construction design along with opinions, consents, permissions and other documents re-quired by specific regulations;
 * deposition about the right to the property for construction purposes;
 * decision about terms of build-up and land use, when such is required.

As part of the procedure for issuance of a building permit it may prove necessary to carry out a secondary environmental impact assessment when (i) such a position was presented in the decision on environmental conditions; (ii) when the authority relevant for issuing the decision discovers that the application for a decision concerns terms changed in comparison with the requirements set out in the decision on environmental conditions; or (iii) by request of the entity planning to execute the project, addressed to the authority relevant for issuing the decision.

Construction work may be initiated on the basis of a final building permit decision. The decision becomes final after 14 days from its delivery to participants in the procedure, unless the parties appeal such a decision within that time.

The building decision expires when construction is not initiated within 3 years from the date on which the decision became final or when the construction work was suspended for a time longer than 3 years. In such an event it is necessary to apply for issuance of a new decision concerning a building permit or permit to re-start work.

According to the Administrative Procedure Code the decision on the building permit should be granted within 1 month, In more complicated cases the procedure may be prolonged up to 65 days. This does not include time required for completing the documentation.

Electricity production
The Energy Law states that the energy company whose activity consists in the transmission and distribution of electricity have an obligation to conclude grid connection agreement with entities requesting connection to the grid, on terms of equal treatment, if it is technically and economically feasible to supply energy and the applicant meets the requirements for being connected to the grid and taking supply.

Biogas plants are relatively small installations and commonly they are connected to the 15 kV grid. There is no priority access for renewable energy producers compared to other electricity producers. However, the law states that the grid operators have the obligation to sign the con-nection agreement with each entity requesting the connection, In practice the cost of connec-tion may be a barrier. Typically the entity applying for connection is obligated to cover the cost of building the connection to the nearest existing grid while the grid operator is responsible for adjusting the existing grid to enable the new connection. Therefore, it is always crucial for set-ting a biogas plant to consider the distance to the existing nearest grid.

The procedure of getting the connection to the grid includes two main steps:
 * Granting the technical condition on the connection to the grid,
 * Signing a grid connection agreement.

To get the technical conditions on the connection the applicant submits an application to a local energy distribution. The investor has to make a pre-payment of PLN 30 per each kW of the connection capacity. Typically the application form includes information on the applicant and the localization and technical data on the installation (capacity, annual energy production, number of generation sources, nominal voltage of the generation sources, etc.). Following attachments may be required: An important point is that the applicant may be asked to prepare and submit an expertise on the impact assessment of the investment on the energy grid, this is relevant for plants of ca-pacity exceeding 2 MW.
 * Legal title stating the applicant rights to the investment, in which the energy generation sources will be established;
 * Building-up and land use terms with a sketch-map of the investment location in reference to the existing energy grid;
 * An expertise on the impact assessment of the investment on the energy grid;
 * Catalogue card of the generation sources together with certificates, attests, security signs, legalization and homologation;
 * Capacity curve and the curve of energy supplied to the grid during a year;
 * The number of the entry in the Register of Entrepreneurs or the number of the Business Activity Record as well as the tax identification number (NIP);
 * In case plenipotentiaries have been established to perform legal actions on behalf of the applicant, it should also include the full names of such plenipotentiaries’

Granting the technical conditions on the connection is given in terms of a decision. The proce-dure starts when compete documentation has been submitted. Typically it takes 30 days, The technical conditions are valid within 2 years. Within this period a grid connection agreement should be signed. There is also a requirement to have a decision on the building-up and land use terms ready before applying for the grid connection. In order to get the decision on the building-up and land use terms the investor has to receive at first the decision on the environmental conditions.There is an obligation of purchase of the electricity produced in renewable energy source con-nected to the grid.

Biogas to biomethane
Biogas production to biomethane supplied to the gaseous distribution network is not a case in Poland yet. However, important legal regulations conditioning the development of this sector have been already established.

In the Energy Law amended in January 2008 issues relevant to biogas to biomethane produc-tion are included. Firstly, the biogas was defined as a gaseous fuel. Secondly, basis for trading biogas as a fuel that can be supplied to the distribution grid were set.

If a biogas plant operator requests a connection to a gaseous distribution grid, the grid operator is obligated to conclude a grid connection agreement on terms of equal treatment, if it is technically and economically feasible to supply fuels and the applicant meets the requirements for being connected to the grid. The biomethane has to be first cleaned and upgraded to meet the quality requirements of a natural gas.

In practice it will be important for setting the biogas plant that the distance to the existing gas-eous distribution grid proves economic conditions for the connection.So far, there is no evidence how long the procedure for getting the connection will last. It may be considered that similarly to the connection to the electricity grid, the procedure of granting decision on technical conditions on connection to gaseous grid should last approximately 1 month.

The main gaseous grid operator in Poland, which is PGNiG declares that there should be no problems to accept biomethane to the grid if the quality parameters of natural gas will be met. It is possible to mix the biomethane with natural gas.

Incentives for biogas production to biomethane were introduced by the Energy Law in a form of brown certificates. So far, there is no information on the price of the certificates, however it is expected to be the same level as green certificates (for electricity production). The authority relevant to issuing the certificates is the Energy Regulatory Office. Brown certificates have been not issued so far as no biogas to biomethane is introduced to the gaseous grid.

Draft governance relevant for biomethane for gaseous grid was prepared by the Ministry of Economy in Septembers 2010 /18/. This document includes quality parameters for agricultural biogas that have to be fulfilled if the gas is injected to the gaseous grid, see Table 4 2.

Cleaning and upgrading process aims to eliminate CO2, H2S, NH3, O2, H2 and water. Different technologies are on the market, which are also available in the Polish market. However, the considerably high costs of cleaning and upgrading might be a limiting factor for biogas to bio-methane production development in Poland under the current conditions.

Table 4-2: Quality parameters for biomethane from agricultural biogas plants supplied to the gase-ous distribution grid* /18/

* The parameters are measured for following reference conditions:


 * combustion: pressure 101.325 kPa and temperature -298.15 K (25oC),volume:
 * parameters 101.325 kPa and temperature -273.15 K.

Biogas as vehicle fuel
So far, biogas is not used as a vehicle fuel in Poland. There are only few experimental appli-cations for designated fleets. This sector is quite well developed in Germany and Sweden.

Digestate management
This biogas digestate management is a new issue in Poland and is regarded a problematical aspect for biogas plants development, According to Polish regulations the digestate can be classified either as a fertilizer or as a waste.

According to the Fertilizers and Fertilization Law (dated 10th July 2007) any material that is to be registered as a fertilizer or a mean for soil improvement need a formal approving decision of the Ministry of Agriculture allowing this material to be introduced on the market. This decision must be preceded by series of tests and studies defined by the regulations. The material to be registered as a fertilizer or a mean for soil improvement must be stable in terms of its parameters and its usefulness for crops and soil must be proved. The most important parame-ters are the content of nitrogen, potassium, phosphorous as well as the content of organic matter.

The issue of using digestate as a fertilizer came with the biogas plants becoming more popular in Poland. The Fertilizers and Fertilization Law is now being changed to facilitate the de-velopment of biogas production in agriculture. However, it is now not clear if the digestate will be registered as a fertilizer or it will be recommend to be classified as a waste. This issue is now under agreements between the Ministry of Agriculture and the Ministry of Environment.

When the digestate cannot be classified as a fertilizer or a mean for soil improvement it is considered as waste. These issues are relevant for the Ministry of Environment. According to the current waste catalogue the digestate may be considered as following waste types:
 * 190605: liquids from anaerobic digestion of slurry, crop residues or crops,190606:
 * post-fermented wastes from anaerobic digestion of slurry, crop wastes and animal wastes.

The management requirements for these types of waste are included by governance by the Ministry of Environment from 14th November 2008. The digestate can be spread on the sur-face of the land under the conditions stated within this governance. This means that according to current legal regulations digestate has to be meet the strict requirements for the municipal sewage water sledge stated in the governance by Ministry of Environment dated 1st August 2002.

According to the information from the Department of Waste Management in the Ministry of Environment consultations are carried towards the mitigation of the requirements that should be met by the digestate from agricultural biogas plants (to be not as strict as for municipal sewage water sledge). However, the new regulations are still in very early stage of prepara-tions. In practice the digestate from existing agricultural biogas plants is spread on the land belonging to the biogas plant operator. Typically it is spread on the meadows without any processing. It cannot be sold as this would require an official registration at the Ministry of Environment as a fertilizer or soil improvement, which doesn’t happen in practice so far. The biogas plant operators often indicate that the digestate management is a difficult issue for the biogas projects. The current regulatory framework in Poland is very strict and does not consider digestate from biogas plants as a valuable organic fertilizer. The digestate manage-ment is therefore an urgent issue that needs to be solved in a clear way if the agricultural bio-gas sector is to be developed well.

Country characteristics
Poland has a considerably large biogas production potential in the agricultural sector. It has not been utilized so far. The technical potential has been estimated at 26.2 PJ, with regard to the fact that the agricultural biogas plants development is justified at farms having more than 100 heads of cattle or 500 heads of pigs or 5000 heads of poultry /19/. Development of agricultural biogas plants is expected to mitigate the negative pressure on the environment from intensive animal production farms in Poland. Inappropriate slurry manage-ment is often a source of nitrogen and phosphorus pollution of surface water and soil as well as shallow groundwater. Also the raw slurry fertilization is arduous because of the odours.

Biogas plants development at animal farms is regarded as a sustainable management practice in agriculture. The animal wastes are available at place and can be used without any costs to produce valuable products which are green electricity and heat. The animal wastes can be supplemented with maize silage and by-products from food processing industry. In Poland biogas plants were built from the 1980-ies according to the technical projects elabo-rated by the Institute for Building, Mechanization and Electrification of Agriculture (IBMER). They had a fermentation tanks (steel) of 25 m3 or 2×25 m3 and were designed for farms hav-ing 20-60 LSU. For farms having 40-60 LSU the recommended fermentation tanks (reinforced concrete) were 50 m3 and larger /19/.

The slurry ran down gravitationally to the initial tank. There it was mixed with an eddy pump and transported in a pipe to the fermentation tank. The fermentation tank was supplied once a day with a 1-day slurry dose. It was a continuous fermentation process with a cyclic supply of raw slurry. The post-fermented slurry was lead out of the tank at the same rate as raw slurry was delivered. The content of the tank was blended 3 times a day with a hydraulic system. It was a mezofile fermentation process (35oC). The fermentation tank was heated with a hot water from a boiler. The biogas was lead out from the fermentation tank to a steel biogas tank. Before the outlet the biogas was cleaned. In order to remove the sulfur an ore filter was used. From the biogas tank the gas was lead out to a gas cooker and heater in a house and to a water heater. An exemplary installation was supplied with 5 m3 of slurry per day producing 70 m3 of biogas /19/.

Nowadays none of the installations build by IMBER is running because of both the technologi-cal and economic reasons. These objects were built before the political and economic trans-formation in Poland. After that, most of the animal breeding farms, at which the biogas plants were building, collapsed. The other reason is that only recently there is a renunciation system for electricity and heat production at biogas plants.

Currently 5 out of 6 existing agricultural biogas plants are built at the animal breeding farms owned by the Polish-Danish company POLDANOR. In 2005 the Management Board of POLDANOR decided to build several agricultural biogas plants in the vicinity of farms managed by the company. In order to execute the idea and to carry out the necessary actions, the Biogas Department was established. The team of highly qualified specialists in power production, building construction and biogas production are re-sponsible for planning, design and supervision of the construction of the biogas production plant /20/.

Agricultural biogas plants are biogas production facilities in which the technological process is based on mesophilic (37 ± 2°C) or thermophilic fermentation. The process of fermentation by methanogenic bacteria results in biogas containing 58-64% of biomethane and 36-42% of carbon dioxide. The energy raw materials used for biogas production include animal and plant production waste, maize silage, ground grain and glycerol. The biogas produced in the process is burned in a CHP module, which produces electricity and heat. The electric and heat is used partly by the facility itself, but the remaining part is sold to external consumers. The post-fermentation sledge is a fermented mixture of the energy raw materials, which can be used as a fertilizer or for compost production /20/. An overview of selected biogas plants of POL-DANOR is presented in Table 5 1.

Table 5-1: Overview of selected agricultural biogas plants owned by POLDANOR company /20/

Summary of positive aspects

 * Energy Law amended in favour of agricultural biogas sector. The amendment of Energy Law (8th January 2010) introduced a definition of agricultural biogas as a gaseous fuel, which is an important base for the establishment of this sector. Relevant regulations for the biogas plants connection to the electricity and gaseous distribution grids were introduced by the law. Remuneration system available for biogas plants was defined.
 * Guarantee of sale for the electricity supplied to the grid. Each amount of electricity from renewable energy sources, including biogas plants, supplied to the grid has to be bought by the grid operator.Guarantee of sale for the biomethane supplied to the grid. If there is a biogas plant supplying the biomethane to the gaseous distribution network (which is so far not a case in Poland), there is an obligation to buy the biomethane by the grid operator.
 * Guaranteed price for the electricity. The electricity produced in renewable energy sources, including biogas plants, has to be bought be the grid operator at a price not lower than a min-imal price defined each year by the head of the Energy Regulatory Office.
 * Colour certificates. There is a support system available for biogas plants in a form of colour certificates. A biogas plant is eligible for granting green certificates for each MWh of electricity produced from biogas as well as yellow or violet certificates for each MWh of electricity pro-duced with a high efficient cogeneration with heat. A biogas plant producing biomethane will be granted brown certificates.
 * Connection to the grid. Each biogas plant, whatever capacity it has, can be connected to the electricity grid. The costs are shared by the electricity grid operator and the owner of the biogas plant. There is no priority of connection for biogas plants over other generating sources.

Summary of negative aspects

 * Social conflicts. Agricultural biogas plants are a new type of activity in Poland, which is not familiar for the majority of society. Often there are local conflicts when an idea of a biogas plant establishment is raised. People are afraid of odours and the risk of explosion. It is nec-essary to promote sustainable biogas investments, including good practice examples, in order to convince the local societies for such projects being established.
 * ' Lack of guarantee for heat sale and heat price' . Green heat, including heat produced in biogas plants, has no price guarantee. Neither there is a guarantee that it has to be bought by the local heating network operator. Currently, the heat is being sold only if the biogas plant owner finds a buyer.
 * An equal support for all types of renewable sources. The green certificates system availa-ble for the electricity produced in renewable energy sources in Poland offers the same level of support for the various RES technologies. Biogas plants has much higher investment cost per MW of electrical capacity installed compared with other RES technologies. In order to stimu-late the development of different RES, a differentiation of the level of support is recommend-ed.
 * Lack of stable and long-term support system. The system of colour certificates is defined only for a short or medium term. For green certificates it is till 2019 for yellow ones for 2012, respectively.
 * The post fermentation digestate as a waste. According to a current legal framework the digestate is classifies as a waste. The intention is to classify the digestate as an organic ferti-lizer. This requires changes in the Waste Law as well as Fertilization and Fertilizer Law.

There is a lack of Polish industry producing the technology and equipment for biogas plants. Currently, on the Polish market there are a lot of biogas production technologies coming from Germany, Sweden, Denmark and Austria.

Further topics
The agricultural biogas sector has a great development potential, which is mainly based on the existing by-products and waste in the agricultural sector. So far, this development was hindered by the lack of relevant regulatory framework which caused various organizational problems as well as lack of relevant economic support for this specific activity.

Over the last two years the interest in agricultural biogas plants was stimulated by the devel-opment of relevant regulatory framework as well as availability of the financial support availa-ble from the EU Cohesion Found under the Operational Programme “Infrastructure and Envi-ronment” as well as other sources.

Under the Operational Programme “Infrastructure and Environment”, Priority IX Environment-Friendly Energy Infrastructure and Energy Efficiency the Measure 9.4 provides support to in-vestment in renewable energy sources. So far two calls for projects have been announced, the first one in 2009 and the second one in 2010.

Under Measure 9.4 support is provided for projects of setting up units generating electric en-ergy or heat from renewable sources. As for project elements, support covers the building works, infrastructure, including all necessary equipment, connecting the electricity and/or heat generating units to the nearest existing power/heat grid, etc.

Maximum share of qualified costs funding in Measure 9.4 ranges between 30-70% depending on the size of the company and the part of the country where it is located.

Minimum project value: PLN 20 million, with the following exceptions: The maximum amount of support – PLN 40 million.
 * for investment in production of electric energy from biomass or biogas – PLN 10 million;
 * for investment in the form of constructing or expanding small hydro-electric installations – PLN 10 million.

Several biogas projects have been accepted for founding so far.

Economic and logistical environment
tbc

Natural resources and potentials
Poland has a large potential for biogas from sewage treatment plants and municipal waste landfills which is closely related to the number of inhabitants (population - 38.2 million (2009)) generating sewage and municipal waste.

Biomass from Sewage The highest water consumption by households in observed in voivodships:
 * Key figures on water consumption from water-line system and sewage generation in households in Poland 2009 /5/ / are as follows:· Consumption of waster per capita – 35.3 m3 in urban areas, 25.0 m3 in rural area
 * Sewage generation - 823.4 millions m3 in urban areas, 371.3 millions m3 in rural areas, totally 1194.7 m3

Mazowieckie - amounts to 35.6 m3 per capita and year (m3/capita annually) and Wielkopolskie - 35.3 m3/capitta annually, while the lowest in voivodships: Świętokrzyskie (24.6 m3/capita/a) and Podkarpackie (22.2 m3/capita/a). This ratio ranges significantly in urban areas: from 40.2 m3/capita/a in Mazowieckie Voivodship to 30.6 m3/capita/a in of Podlasie Voivodship, as well as in country-side where is much lower and amounts from 34.0 m3 in Wielkopolskie Voivodship to 16.2 m3 in Małopolskie Voivodship.

Taking into accounts optimum working conditions of Anaerobic Digestion in the WWTP, it is possible to produce some of 200 m3 of biogas from 1000 m3 of wastewater (feed) in term of waste water from municipal sector.

Assuming, that produced volume of waste water is directly related to consumed water and assuming 80% average ratio of cleaning ratio of waste water in Poland, we might expect production of 191 millions m3/a

of biogas (having HHV equals 21.6 MJ/m3) being equivalentof 4.13 PJ/a of primary energy (1,148 GWh/a) theoretically.

However, taking into consideration of size of WWTP eligible for installing AD Plant for biogas, practical potential is much lower and amounts to the level of 2,74 PJ/a (760.7GWh/a). The technical potential of biogas from wastewater treatment plants, stands at 2.74PJ /a, which corresponds to 760.7 GWh/a of primary energy /32/.

Energy generation from LandfillsIn

Poland, about 12 million Mg of mixed municipal waste is generated annually, but it can be assumed that the biodegradable fraction is 46% of mixed waste and decomposition of the waste occurs in landfill sites. It is assumed that from one tonne of waste can be recovered200-250 m3 of landfill gas with methane content of large fluctuations (45-65%).

Assuming the biogas yield of 200 m3/Mg (130 m3 CH4/Mg) recovery of methane from biodegradable waste in Poland could be around 730,000 m3 annually. It is equivalent of 26.27 PJ/a (7,300 GWh/a) of primary energy sources.

Basing on these factors, it is estimated, that Polish biogas potential from landfilled municipal waste amounts to the level of 730 millions m3 of methane annually. In the study done by GIG within SEBE project, feasibility and viability of biogas production on existing landfills have been taken into account. Technical biogas potential has been estimated at 9.77 PJ/a (2,714 GWh/a) of primary energy equivalent /32/.

It is also important to stress, that practical use of existing landfill potential is significantly lower. For instance in the year 2009 captured biogas allowed to produce only 0.201 PJ/a of energy - 0.07 PJ/a of heat and 0.13 PJ/a of electricity. Assuming 85% of efficiency theprimary energy amounted only to 0.237 PJ/a which is far away from conservative estimated potential of landfill biogas (9.77PJ/a) /5/.More detailed information on utilisation of landfill gas is given in the Table 3-1, taken from published by GUS Report /5/.

Table 3-1 Degassing of controlled landfill sites in 2009 /5                   Biomass from agricultural production and manure

The main feedstocks for biogas production by anaerobic digestion (AD) are agricultural                            manure wastes and food wastes. There are a lot of different estimations of agricultural biogas potential in Poland, depending on the methodology and assumptions: from 25 PJ (Ministry ofEconomy, ARE, 2009 in PEP 2030), through 153 PJ (IEO in the report prepared for Ministry of Economy, 2007) up to 486 PJ (PIGEO report in 2008). But it is clear that potential is in the place and is not used almost at all /6/. Poland, with total area of 312,679 km2 (including inland waters as well as a part of internal waters), is an agricultural and industrial country with high area of agricultural land and forests. The predominance of lowlands, ca. 75.1% of the total area is very conductive to agriculture.The areas elevated between 200 and 300 m above see level equal 16.2%, between 300 and 1,000 - 8.5%, and only 0.2% of the area is 1,000 m above see level. In 2009 agriculture land covers the area of 18,981,000 ha, of which arable land orchards, permanent meadows and pastures - 18,243,000 ha. Forest land as well as woody and bushy land covers 9,496,000 ha, wasteland – 485,000 ha and ecological arable lands34,000 ha. In 2009 the share of agricultural land in the total area of the country was about 61% and the share of forests and woods ca. 30%. Agricultural land is concentrated on areas with fertile soils and in the less industrialised central and eastern parts of the country. The lowest shares of agricultural land are observed on areas featuring natural conditions disadvantageous for farming, the highly forested north--western Poland, and the areas characterised by high degree of industrialization and urbanisation.

Arable land takes most important share in the structure of agricultural land. The highest shares of arable land exist in the region of Wielkopolska, western part of Masovia, on Lublin Upland, Małopolska Upland, Vistula Delta, Silesian Lowland and in Kujawy.

Among the perennial crops most important in Poland are orchards, taking around 2% of agricultural land. Three main areas of intensive fruit production can be distinguished in Poland:Grójec-Skierniewice, Sandomierz and Subcarpathia Region. Grasslands occupy around20% of the total agricultural land. In 2009 the area of meadows was 2,463,069 ha, and of pastures – 716,618 ha. The biggest areas of grasslands exist in the regions, characterized by low quality of agricultural production space. Meadows concentrate along the valleys of bigger rivers, in the mountains and on wet areas. Pastures exist mainly in the north-eastern part of the country, in the Carpathians and their foothills, as well as in Sudety Mountains.

Table 3-2 presents agricultural land use in regions (voivodships) of Poland (p.17). The total area of sown is about 11,6 millions ha (2009). Figure 3-1 shows share of the area of the main groups of crops in the general sown area. In the structure of sown area, totalcereals (basic cereals (wheat, rye, barley, oats and triticale)) and mixtures of cereals including maize for grain and other cereal crops) constitute 73.9% of the general sown area and were cultivated in the area of 8,6 millions ha.

Figure 3-1Share of the area of certain groups of crops in the general sown area (2009)

Table 3-2 Agricultural land use in Poland (2009) /7/

Share of area of certain industrial crops in the total sown area of industrial plants are given in Figure 3-2. Area of sugar beets growing is 199,900 ha, rape and turnip rape 810,000 ha and maize for green fodder 419,800 ha.

Figure 3-2 Share of the area of certain groups of crops in the general sown area (2009)

Collected data related to production of crops and yields as well as crops harvest are presented in Table 3-3 and Table 3-4 respectively.

Table 3-3 Major crops production and yields in Poland (2009) /8/

Table 3-4: Estimated harvest of crops in 2010 in millions Mg in Poland /9/

Production of fooders production (estimated) in season 2009/2010 is estimated as 22 millions tons, while production of industrial feeds 7 millions tons.

Area of energy crops

In 2007 year, the whole declared by farmers area of crops grown for energy purposes reached in Poland 175,381 ha, of which area of permanent fields only 6,816 ha, which constitutes 3.9 % of area of these crops and 0.42 % of total arable land (Table 3-5).

Table 3-5: Area of energy crops in 2007 /10/

Potentially available land area for cultivation of energy crops is estimated to be 1,000,000 ha(theoretical potential) and 755 PJ per year (technical potential).Energy potential of different of biomass resources /11/as estimated to be:

· biomass – 755 PJ

· energy crops – 223.7 PJ

· biogas - 43.9 PJ

In Table 3-6 detailed data related to energy potential of residues from agriculture, food industry,

forestry, paper industry and solid waste are given /12/.

Table 3-6 Potential of industrial residues /12/

Installed and potential biogas capacit
Installed biogas capacity for production of electricity in the period 2001 – 2009 are presentedin

Figure 3-3 /13/.

Figure 3-3 Capacity of power stations in Poland using biogas: period 2001÷2009 (GUS) /13/

The most promising future development will be based on agricultural biogas plants. There is a huge interest in new agricultural installations – there is about 200 projects in preparation, however only the best from them have a chance to be implemented, it can beseveral projects within this year. Key energy players – big energy companies and gas traders are potential investors in this sector.

Agricultural biogas and landfill gas are used in combined heat and power production mainly. The sewage gas is used in process heat production and in combined heat and power production. There are no other ways of biogas utilization in Poland at this moment. This trendgoes in line with the current support schemes on renewable energy.

In Poland there are no official statistics on the number of biogas plants. And only biogas plants producing electricity are well documented, because they are obligated to get concession from National Energy Regulatory Office URE and are reported each year. Accordingto URE data, in 2010 there are working 136 biogas installations: 52 on sewage treatment gas, 77 on landfill gas, 7 agricultural biogas plants. Installed capacity amounts to 79.5 MW, of which agricultural biogas plants capacity – 7.5 MW. The summary of identified biogas plants producing electricity has been shown in Table 3-7 /14/ /15/ /16/.

Table 3-7: Biogas plants producing electricity and installed power capacities [MW] /14, 15,16/.

To follow the current situation concerning the operated biogas plants in Poland the study within SEBE project has been conducted by GIG. In result basic data on operated and planned biogas plants in Poland have been collected. By the end of year 2010, 155 biogasplants have been identified of which:
 * · 67 biogas plants localised on WWTP,


 * · 73 biogas (landfill gas) capturing facilities localised on Municipal Landfills

Power capacity of all these plants amounts to 90 MWel. These plants are presented on map of Poland (see chapter 5). The lists of biogasplants in operation and planned are included in Annex 1 Supplementary Tables: Table I and Table II.
 * · 15 agriculture biogas plants

Biogas market
In the last years it is observed that amount of biogas produced increase constantly as result of growing market of biogas.

Key figures on development of production of biogas from different sources in the last nine years in Poland are presented in Figure 3-4. The main sources of biogas in Poland are waste water treatment plants and landfills. It is noted, in the last years the significant growth ofbiogas production from all sources, but particularly from agricultural sources.

Figure 3-4 Biogas production in Poland in the period 2001÷2009 (GUS) /14/

According to GIG study, structure of biogas plants in Poland at the end of 2010 is shown in Figure 3-5.

Figure 3-5 Structure of biogasplants in Poland at the end of 2010 (GUS)

Within a market of agriculture biogas dominates private ownership. The biggest shares of the agriculture biogas market, some of 40% market, have been taken by Poldanor S.A. (big agriculture company) which constructed and operates 6 biogas plants. Currently only 2 biogas plants are owned by state or municipality.

Biogas plants located on WWTPs are owned mainly by entities which operate WWTPs. Ownership structure of WWTPs in Poland (2009) is presented in Figure 3-6 /17/. According statistic in the year 2009 approximately 15.9 millions m3 (68% of total) of sewage has beenutilized in biogas plants on WWTPs operated by private sector.

Figure 3-6 Utilisation of sewage in Poland - ownership structure (2009) (GUS) /17/

Landfill Biogas Plants have been owned by landfill operator or owner of landfill. Ownership structure of landfill sites in Poland (2009) is shown in Figure 3-7. According to GUS statistics in the year of 2009 about 88% landfills have been (721 landfills) owned by municipalitiesIt is common opinion that in Poland the following barriers and obstacles do not allow development of biogas market:


 * organisational: weak institutional and organisational support of potential investing inbiogas, limited number of professionals having expertise in biogas,
 * technical: limited access to power grid and its limited throughput, limited availability ofheat utilisation particularly in rural area, legal:
 * lack of detailed and explicit defined regulation on operation of biogas plantincluding waste generated by AD (anaerobic digestion) processes,
 * financial: lack of effective, having long term perspectives financial instruments includingsubsidies.

Figure 3-7 Landfill sites in Poland - ownership structure at the end of 2009 (GUS) /17/

International treaties and EU requirement Poland is obliged to produce 7.5% electrical energy from RES by the end of year 2010. Production of electrical energy using RES in Poland on the end of 2009 is presented in Figure 3-8.

However, statistics for year 2009 says, that this ratio amounts only to level 6% and most of this production has been done by biomass cocombustion in coal fuelled power station both system power station and industrial power station.

Observing a dynamic growth of RES to electricity market, it must be stated, that this goal will not be achieved in the year 2010.

Figure 3-8 Production of electrical energy from different RES (2009) (GUS) /13/

National strategic document “Energy Policy of Poland until 2030” adopted by Resolution no 202/2009 of the Council of Ministers on 10 November 2009 /18/, recognises biogas as one of the important solutions for de-carbonising of Polish economy. Appendix 2 of “Energy

Policy of Poland until 2030” - Forecast of demand for fuels and energy till 2030 – contains forecast of final energy production from biogas. According to this forecast final energy brutto from biogas will increase dynamically in the future. The forecast is presented in Table 3-8.

Table 3-8 Biogas contribution to brutto final energy demand /18/

Based on data mentioned above, it was calculated, that in year 2020 - 31 TWh/a electrical energy using RES will be produced, which will account to 18.4% of total electricity produced (it is below EU goal 20%), in year 2030 - 39.5 TWh/a from RES will be produced, ofwhich 16 TWh/a will be delivered from utilization of biogas.

Table 3-9: Forecast of prices of energy carriers in Poland: natural gas, electricity, district heat /18/

Considering incentives such as certificates, soft loans already existing and also foreseen in Draft of National Action Plan on Renewable Energy Sources /1/ it is justified to conclude, that in order to assure increasing economical feasibility of biogas use as well as to attractprivate investments into this branch of renewable energy sector further dynamic increase of prices of produced energy/heat must be guaranteed. It is expected that these prices should follow the increase of prices applied for common energy carriers.

The most promising future development of biogas use will be based on agricultural biogas plants. There is a huge interest in new agricultural installations – according of works within framework of EU co-financed project entitled “BIOGASMAX” /20/. In Poland in 2009there were about 200 biogas projects in preparation.

Based on survey made by Instytut Energetyki Odnawialnej (IEO) / Renewable Energy Institute, it is estimated, that in Poland some of 300 biogas plants have been planned to be installed with total estimated cost 9,000 millions PLN /21/.

Survey made by GIG within SEBE project updated data concerning the planned agricultural biogas plants. On the base of information from internet, URE registered RES Plants Database and telephone interviews the following facts has been established: o Lubelskie Voivodship – 29 plants
 * Currently 184 biogas plants are in planning phase,
 * The leaders (administrative units- voivodships) are:

o Wielkopolskie Voivodship – 28 plants
 * Average size of the planned biogas plants is 1.6 MW, it seams such capacity of plant is economical in Polish conditions (taking into considerations availability of substratesand ability to utilise produced electricity and heat). Recently, it is considered construction  and technology supply for some biogas plants with capacity 2 MW /22/.As summary of works list of the planned biogas plants and their capacity is presented in Annex 1 (Table II).

Possible behaviour and expectation of Polish biogas market has been described in report worked out by BSJP in alliance with Taylor Wessing in 2009 /23/. This research has been carried out based on a sample of 200 selected municipalities throughout Poland.

The sample has been selected in proportion to the division of Poland into 16 voivodships and 3 types of municipalities: urban, urban-rural and rural, according to the actual share of these entities in the administrative division of Poland. This research has been carried

out through telephone interviews (CATI) with persons responsible for the municipality investment decision making process. The findings of the report has been summarised by authors as follows:


 * A decision as to renewable energy investments planned for 2010-2012 has notbeen made yet in the majority (82%) of Polish municipalities.National Report: Poland, prepared by GIG (Główny Instytut Górnictwa), January 2011SEBE – Economic and Logistical Environment 30
 * Municipalities planning to invest in biogas power plants as well as biomass-fuelledpower and thermal power plants – within the next 3 years – constitute 12% of thetotal number of municipalities.
 * Municipalities that have made a decision not to invest in biogas power plants aswell as biomass-fuelled power and thermal power plants constitute 6% of the totalnumber of municipalities.
 * Plans as to renewable energy investments have been made in twice as many ofthe urban and urban-rural municipalities (18%) as in the rural municipalities (9%).
 * Investment plans have been made at a more than average scale in municipalitieslocated in 3 macro-regions: Północnowschodni (19%), Pomorski as well asWschodni (17% each).
 * An overwhelming majority of municipalities with investment plans in place intend toinvest in one type of facilities: 7% of all the municipalities will be investing inbiomass-fuelled power and thermal power plants, and 6% in biogas power plants.
 * A slight majority of municipalities intend to invest in the connection of a biomass orbiogas facility to the grid instead of designing and constructing their own plant.
 * Non-refundable EU and state funds will have the highest share in the renewableenergy investments (74%), and loans the lowest – (10%).

Economic viability
Access to economical information on biogas plant is limited. But more detailed study will be done on later stage of SEBE project while biogas plant cases will be considered. Currently only some general observation of Polish market is presented below.

In the case of biogas plant owned by municipalities economic viability was not primary factor for taking decision on investment into consideration. However, internal rate of return on capital was acceptable, but it never reached the level acceptable by commercial entities,

which usually accept investment with IRR well above of 16%. In most cases time of returning of capital reaches level of 5 years in the case of investment into plant for biogas utilization and reaches level of 10 years or more while investment includes also plant for biogas generation.

In Poland such ratio for private investors are too high and some additional financial or legal incentives must be introduced in order to have positive development of biogas market.

It must be noted, that the most important factors for economy of biogas plant are the prices of electrical energy and natural gas and their interrelation. Prices of electricity and natural gas are presented in Figure 3-9 and Figure 3-10 respectively.

Figure 3-9 Prices of electricity for households and industry in the period of 1990÷2008 (GUS) /19/

Figure 3-10 Prices of natural gas for households and industry in the period of 1990÷2008 (GUS) /19/

Analysing possible changes of the profitability of the plants for production and utilisation of biogas, we should take into account the prices of energy carriers such as: natural gas, electricity and district heat, because the indicators of the effectiveness of this type ofinvestments are very sensitive to these parameters (prices). The forecast of prices of energy carriers in Poland (natural gas, electricity, district heat) are shown in Table 3-9.

Biogas valorisation
Overview on current status of biogas valorisation Currently, in Poland biogas is namely produced on WWT Plants, landfills and byentities related to agriculture sector, mostly cattle and pigs farms and other food processing plants. Agricultural biogas and landfill gas are used mainly for combined heat and powerproduction.

The biogas produced on WWT Plants is namely used for heat production and in combined heat and power production. This trend goes in line with the current support schemes on renewable energy according to URE (Energy Regulatory Office).

Biomethane to be accepted by natural pipeline system should comply with following standards and regulation: Electricity production Electricity consumption in 2009 was 137 TWh. Production of electricity has fallen third time in a row and amounted to 152 TWh. Almost half of electricity is consumed by industry, share of households amounted in 2009 to 19% and others consumers to 27%.
 * Minister’s of Economy Regulation issued on 2 July, 2010 on detailed conditions of functioning of gas system (Dz.U./ Official Law Journal of 2010, No 133, item 891/ Rozporządzeniu Ministra Gospodarki z dnia 2 lipca 2010 r. w sprawie szczegółowych warunków funkcjonowania systemu gazowego (Dz. U. z 2010r. Nr 133 poz. 891).
 * Polish standard PN-C-04750: Gas Fuels. Classification, marking and requirement/Paliwagazowe. Klasyfikacja, oznaczenie i wymagania.
 * Polish standard PN-C-04753: Natural gas. Quality of gas delivered to user by gasdistribution system / Gaz ziemny. Jakość gazu dostarczanego odbiorcom z sieci rozdzielczej.

Production of 90% of electricity is based on coal (hard and lignite). Small amounts of electricity come from water power plants. The share of renewable energy sources (biomass, wind and biogas) despite rapid development is still small.

National power system consists of three subsystems:· In year 2008, it was estimated, that some of 34% of transmission lines are older then 30 years and system will require heavy investment estimated to amount some of 55 billions PLN /25/.
 * Power generation ·
 * Power transmission system of high voltage ·
 * Distribution power system of high voltage, medium voltage and low voltageTransmission lines of the Polish National Power System 750 kV, 450 kV, 400 kV, 220 kV are presented in Figure 4-1 /24/.

Biogas to biomethane

There are no biomethane producing plants in Poland. There are no biomethane or any biogas upgrading plants under construction. As consequence of this situation biomethane is not used for transportation purposes.

Production of natural gas in Poland covers 30% of annual consumption, the rest is imported. Part of this production from resources located on Western of Poland (Wielkopolska and Lubuskie) contains significant amount of nitrogen - it is so called nitrified natural gas.

Verysmall amounts of produced gas are exported. Since year 2004 increasing of natural gas consumption has been observed. It is caused namely by extending gas delivery system to households and gradual using of natural gas as input in energy sector. Some of 59% ofnatural gas (80% of nitrified natural gas and about 55% of high-methane natural gas) is used by industry, including chemical branch where natural gas is used as raw material for industrial production and not for energy purposes. Households consumed about 25% of natural gas in 2009. Due to new contracts signed with GAZPROM for next 20 years and investment into terminals for LNG (Liquid Natural gas) it is expected that in near future will be a surplus of 2 billion m3 of natural gas. Additionally to that it is expectation that in Poland new type of gas resources might be available – according to various studies, between 1.5 and 5 trillion of shale gas could lie beneath the surface of Poland. Currently a number of foreign gas companies (namely Americans) have been licensed for exploration this unconventional gas resources.Thus it will be very difficult to accept biomethane by gas distribution companies (PGNiG S.A. and regional Gas Works) and pump biomethane into operated pipeline system.

However, analysing the particular regional gas distribution infrastructure, it must be noticed that ability to connect to system exists namely only towns and municipalities located in centres of voivodships gas networks. Thus in some cases gas network is not available in ruralareas located close to border regions and it might be opportunity to develop local system based on utilisation of biogas. It is illustrated in Figure 4-2 and Figure 4-3 - made out of screens of information web pages provided by gas distributions companies:

Figure 4-2 Possibility of connection to gas distribution networks, WSP, example – municipality Barwice
 * Wielkopolska Spółka Gazownicza (Wielkopolska Gas Company) which operates on North-West of Poland in three regions -Szczecin, Koszalin, Poznań and Kalisz,
 * Municipalities marked greyish indicate ability to connect new client into to gas distribution system, however often it is possible only in settlements having high density of urban fabric (see example on presented on Figure 4-2, providing information related to municipality of Barwice). The table presented on right hand of this figure SEBE – Economic and Logistical Environment 34 informs, that only two towns have possibility to connect gas distribution system, in other villages such possibility does not exist.
 * Górnośląska Spółka Gazownicza (Upper Silesian Gas Company), which operates in middle south of Poland in two regions Opole and Katowice.

Figure 4-3 Possibility of connection to gas distribution networks, WSP, example – municipality Wołczyn Biogas as vehicle fuel There is no bio-methane or any biogas upgrading plants under construction and thus bio-methane is no used for transportation purposes. However in some regions of Poland, the existing natural gas vehicle fuelling stations can play an important role for the development ofbiogas use as a vehicle fuel.

In Poland, currently about 1500-1700 vehicles are powered with compressed natural gas (CNG). The first natural gas fuelling stations were built in the mid 50s in urban areas such as Krosno, Rzeszów, Tarnów, Kraków, Mysłowice, Zabrze, Gliwice, Sosnowiec, Bielsko-Biała/26/.

Today in CNG is distributed in 33 public filling stations /27/. In addition, there are 13 stations inacessible to the public, operated by different companies, including two stations by the company: Fiat Auto Poland in Bielsko-Biała and in Tychy. The largest number of thestations is located in the Carpathian Gas Company. Until 2014, it is expected to create 20 new stations in the vicinity of cities: Szczecin, Olsztyn, Poznań, Łódź, Warszawa, Kielce, Częstochowa, Wałbrzych, Gliwice, Katowice, Sosnowiec, Cieszyn, Zakopane and Nowy Sączshows the location of CNG stations on map of Poland /28/.

Customers of CNG refuelling stations can be divided into four groups: public transport, fleet of vehicles, vehicles of company PGNiG and individual customers.

At the moment 280 buses are running on CNG in 21 Polish cities. In the majority of cases these are buses Jelcz, imported Volvo from Western Europe and Solaris. Public transport operators using CNG buses in 19 Polish cities. Most of them ride in Rzeszów (40),

Tarnów (32), Radom (25) and Tychy (19) /29/. Number of vehicles fleet including other vehicles of the Polish Post and taxi companies) powered with CNG was approximately 280 at the end of 2008.

Currently in Poland you can buy 18 models of new cars factory-fitted with compressed natural gas supply. Most of models offers Fiat, available are also cars: Ford, Opel, Voltswagen, Volvo and Mercedes.

Based on data available from the CNG stations we can estimate the number of individual customers at about 700 peoples. According to PGNiG in 2007 the sales natural gas for motor vehicles amounted to 7,450m3. The share of CNG sales for 2007 in the total domesticconsumption of natural gas amounted about 0.05%. For the promotion of CNG driven vehicles, PGNiG SA offers refund of figure of 1,500 PLN by the assembly of CNG installation. Currently, the price per 1 m3 of gas at all stations is 2.40 PLN (1.97 netto PLN) /28/, and by October 2013 CNG is supported by the zero rated VAT.

Key figures on use of CNG as vehicle fuel in Poland are presented in Table 4-1.

Table 4-1 Key figures on use of CNG as vehicle fuel in Poland /28, 30/

The number of CNG vehicles increases due to the national and EU programs, which support activities for the reduction of emissions to air and increase the share of renewable energy sources. This leads to the development of distribution networks and CNG stations.

Considering the development of use biogas as vehicle fuel in Poland, the infrastructure available for compressed natural gas offers synergies concerning the distribution of biogas as a vehicle fuel in the future. The combination of biogas refueling stations and CNG refueling stations creates promising opportunities for introducing use of biogas. But, before everything else, implementation of biogas use as vehicle fuel in Poland needs political aspiration for promotion of this fuel associated with economical incentives.

Natural resources and potentials
There are no database available presenting spatial potential of biogas from different sources on map of Poland. Currently available documents and publications provide evaluation of potential of biomass usable for biogas production based on national resources, but not cover the needs of this report /1/ /6/ /31/.Therefore, to fulfil requirement of this report, particularly while potential of biogas production broken into administrative units (voivodships) of Poland should be considered, own estimations of natural resources and biogas potential, within WP3 SEBE project, were developed. It has been done in additional study entitled: “Ocena potencjału energetycznego biogazu otrzymanego z róŜnych rodzajów biomasy, osadów ściekowych i odpadów komunalnych dla Polski w układzie województw - Assessment of the energybiogas

potential from different types of biomass, sewage sludge and municipal waste for voivodships in Poland” /32/. In this study, the used methodology of estimations energy potential of biogas has been described.

Obtained in result, figures presenting energy potentials of biogas from different sources related to regions (voivodships) in Poland, have been presented on maps. Maps have been elaborated using software ESRI ArcGIS. Raster background in form of general map of Poland at a scale of 1:1 000 000 has been imported. Maps have been elaborated in geographical coordinates WGS84. Final maps are at a scale of 1:2 500 000.This report presents results of the study in form of charts and maps (see Figures from 5-1 to 5-11. The basic findings of the study related to potential of biogas for energy, we can summarize as follows:


 * Poland has a large energy potential of biogas from agriculture biomass, sewage sludge from WWTPs and municipal waste, which from all these sources is estimated at 52 000 GWh/a (187 PJ). The most significant is agricultural biogas potential, which amounts to 48,600 GWh/a (93%).
 * The biggest oportunities of biogas production from crops are in voivodships: Wielkopolskie, Mazowieckie and Lubelskie and from grasslands in voivodships: Mazowiekie, Podlaskie, Warmińsko-Mazurskie and Lubelskie.
 * Wielkopolskie voivodship has the largest potential for production of biogas from animal manure – about 2 800 GWh/a (due to the number of large live stock farms). It is noted also significant biogas potential from manure in voivodships: Mazowieckie (1 460 GWh), Kujawsko-Pomorskie (1130 GWh/a) and Podlaskie (1100 GWh/a).
 * In the regions of Poland which represent large agglomerations of inhabitants, there is evidence to use sewage sludge from WWTs for production of biogas. At the forefront are two voivodships: Mazowieckie (112 GWh) and Śląskie (94 GWh). It should be also mentioned voivodships such as: Wielkopolskie, Małopolskie, Dolnoślaskie and Łódzkie, where biogas potencjal is estimated at the level 67 -59 GWh/a.
 * In the regions where a great amount of municipal waste are collected and/or large landfills are located, that is in voivodships: Mazowieckie and Śląskie, estimated biogas potential is considerable and amounts: 577 GWh and 486 GWh/a, respectively. In the next positions are voivodships: Małopolskie (231 GWh/a) and Dolnośląskie (217 GWh/a).

Figure 5-1 Energy potential of biogas from animal manure (from large farms in calculation in term of large heads (2009)

Figure 5-2 Energy potential of biogas from animal manure in regions of Poland (2009)

Figure 5-3 Energy potential of biogas from crops (2009)

Figure 5-4 Energy potential of biogas from crops in regions of Poland (2009)

Figure 5-5 Energy potential of biogas from grasslands (2009)

Figure 5-6 Energy potential of biogas from grasslands in regions of Poland (2009)

Figure 5-7 Energy potential of biogas from sewage sludge originated from biological treatment plants (2009)

Figure 5-8 Energy potential of biogas from sewage sludge in regions of Poland (2009)

Figure 5-9 Energy potential of biogas from biodegradable municipal waste disposed on large landfills (2009)

Figure 5-10 Energy potential of biogas from landfills in regions of Poland (2009)

Figure 5-11 Energy potential of biogas from different sources in regions of Poland (2009)



Regional distribution of biogas plants
In Poland, situation in biogas plant is very dynamic and in most cases recorded data need to be verified and often updated. For instance, only official database on biogas plants, operated by URE (Energy Regulatory Office) only recorded plants, which claims so called“green certificates”, special financial instruments created for support of generating electricity using renewable /16/. This database contains only biogas plants producing electricity. In the second case, database operated by Instytut Energetyki Odnawianej-Renewable Energy Institute (former EC BREC) stores data collected on base of survey carried out by Institute is updated periodically, unfortunately not regularly /33/. Thus to produce the database reflecting current situation in biogas sector, own GIG database has been created.

In result of this work 155 biogas plants in operation have been identified, having total energy capacity amounts to 130 MW (of which 90 MWel and 40 MWh). GIG database includes basic data for these plants: location of plant, installed power capacity, main technical andeconomic information on production and utilization of biogas.

Due to the current rapid growth of agricultural biogas plants, the database also included available data and information concerning the 184 planned installations.

GIG database will be updated by direct contact with plant owners or potential developers by phone, e-mails and other means of communications. These works are scheduled for next period of reporting of SEBE and will be part of SEBE web exercise. Resultsof current work in this area are presented in Annex 1 (Tables I and II)

Distribution of biogas plants in different regions of Poland including their number is well-illustrated in Table 5-1 below.

Table 5-1 Biogas plants in operation in different regions in Poland (2010)

The potential of biogas and the number of biogas plants (DSS and L) in regions is closely associated with the number of inhabitants, population density, hence the amount of treated wastewater and landfilled waste. This is reflected in the quantity and distribution ofbiogas plants shown on the map (Silesia - 28 biogas plants, mazowieckie - 19).

As shown Table 5-1 currently in Poland there are only 15 agricultural biogas plants (A) in operation of them half is located in Pomorze (Pomerania) (in voivodships: Pomorskie, Kujawsko – Pomorskie i Zachodnio-Pomorskie). To a large extent it is associated with complexagricultural business of enterprise Poldanor (significant agricultural enterprise in Europe) which conducts production of crops and livestock rearing and pig farming (30 farms) in Pomerania. The company has constructed and operate 6 biogas plants.

Taking into account the number of new projects of agriculture biogas plants, most plants will be located in the Lubelskie - 29 plants and Wielkopolska - 28 plants. This corresponds to the estimated potential of biogas from agricultural sources: animal manure,crop and grasslands. The largest potential biogas production was recorded in the Wielkopolska Region, which is a leader in agriculture industry due to a great number of large farms and a large acreage of crops.

Distribution of planned agricultural biogas plants in different regions of Poland including their number is shown in Table 5-2 below.

Table 5-2 Agricultural biogas plants planned in different regions in Poland (2010)

In Figure 5-12 locations of biogas plants in operation and in planning phase in Poland have been presented.

Figure 5-12 The map indicating locations of biogas plants in operation and in planning phase

Model region(s)
Most of voivodship authorities have prepared plans for developing of wider application of Renewable Energy Resources (RES). Additionally to that, it is requirement stipulated by Act of 10 April 1997 the Energy Law (art. 19) with later amendments /34/ to consider usage ofRES in local energy master plan. These local energy master plans should always comply with objectives of regional and national energy plans.

Analysing the available programming documents and taking into account access to biomass and existing gas network, it is justified to consider Opole Voivodship as model region in the context of efficient policy on biogas environment. Strategy of development of biogas is described in Master Plan for Development of Renewable Energy Resources for Opole Voivodship /35/. Other documents related to biogas use in this voivodship are listed in chapter 8. References /36/ /37/ /38/.

Opole Voivodship (Województwo Opolskie) is located in south-west of Poland with total area 9,412 km2. It is predominately agricultural and industrial region having high agriculture efficiency. Agriculture land accounts for 60% (including farming land, meadow and grassland), 27% of area occupies forest and 13% other use. In Poland, the highest agriculture efficiency of region results from good soil and climate conditions as well as good skills of farmers.

Currently, in Opole Voivodship all form of Renewable Energy Sources are used. It results from availability of such resources in this region and from attitude of local authorities interested in use of local resources as well as to access to regional expertise, well developedby universities, engineering and consulting companies located in the region.

While electricity generation is considered in the context of RES, the significant source is hydropower and wind and solar energy are recognized as minor sources (Table 5-3)/36/:

Table 5-3 Utilisation of RES for heat and electricity generation in Opole Voivodship /36/

Biomass has the highest share in the context of energy generation from RES (70.7%), including: wood waste - 30%, co-combusted biomass - 25%, straw - 6.6% and energy crops - 3.4%. Energy crops occupy 3% of the sown area. Biogas share from sewage treatment plants and landfills is 5.7% of total energy from RES. Estimated energy production for biomas is shown in Table 5-4.

Table 5-4 Energy production from biomass for Opolskie Voivodship /36/

Currently biogas is utilised in WWT Plants located in cities: Opole, Kędzierzyn – Koźle, Nysa and Brzeg (Table 5-5).

Table 5-5 Utilisation of biogas from WWT Plants for heat and electricity generation in Opole Voivodship /36/

The basic direction of the energy use of biomass (wood chips, sawdust, wood waste and waste paper) is the production of heat for technological purpose and heating. There are also small boilers on the straw, which are mainly used for heating of buildings and domestic hot water, heating of greenhouses and grain dryers.

Currently, total production of energy using biogas amounts to 14.15 GWh/a but total energy from RES amounts to 511.9 GWh/a, thus RES accounts for 2.37% of energy production in the region. It is estimated, that biogas potential of Opole Voivodship allows to produce 85.8 GWh/a of electrical energy and 30.2 GWh/a as a heat.

The largest potential of renewable energy sources in the opolskie voivodship is from biomass. The potential of solid biomass is associated with the use of surplus straw and wood waste. In Table 5-6 estimated potential of biomass from different sources is presented.

Table 5-6 Estimated potential of biomass from different sources [GWh/a] /35/

Agricultural biogas was estimated on the basis of animal manure from farms of more than 200 LSU (livestock units – animals, which weight more than 500kg). Biogas from WWT Plants was estimated for plants treating above 10000 m3/d of sewage or for population equivalent ³25,000 PE (population equivalent).

Potential of biomass produced as straw is presented on Figure 5-13 and potential of agricultural biogas is presented on Figure 5-14, both potentials as a charts in form of maps of voivodship with an indication of the division into districts (charts are taken from adopted by Marshal Office Master Plan) /35/.

Figure 5-13 Potential of straw in Opole Voivodship in GWh/a /35/

Figure 5-14 Potential of biogas in Opole Voivodship in GWh/a /35/

Table 5-7 given below, is a supplement to Figure 5-14, and shows the biogas potential from animal manure in terms of electricity /35/.

Table 5-7 Biogas potential from animal manure /35/

Country characteristics
Poland is one of the biggest new EU member states with a total population of 39 millions. This creates a huge consumption market and taking into accounts, that energy use is significantly lower then in other Member States (MS), it is expected that primary energy sources use will increase. However, energy intensity of Polish economy has been decreased in past 20 years, it is still more than twice higher as energy intensity of other MS. Taking into consideration rather low GDP per capita (calculated in PPS) of Poland amounts only to 61% of average of EU27, it will be difficult to fulfil all requirement of EU related to climate and energy policy (low carbon economy). To change structure from primary energy sources with high ratio of use of coal to less carbon intensive fuels into economy, particularly by households will be difficult and very costly, due to high prices of gas (at present apparently average household is able to buy only 1/3 of volume of gas purchased in 1990’s). Moreover, it is expected a strong competition on natural gas market due to possibility of utilisation of shale gas resources in the near future.

There is very high potential of biogas in Poland, which gives a good base for development of this type of renewable energy sources. However, sector of biogas is still not fully developed.

It is observed dynamical increasing of presence of German and Danish companies, which create Polish subsidiaries located namely in Western and Northern part of Poland, in the region having well developed agriculture industry (e.g. Wielkopolskie Voivodship). It might assure development of local experience in the near future and development of local suppliers of biogas investment goods and construction services.

Additional to that, it is important to stress, that on majority of the WWTPs producing biogas, Polish origin desulphurisation technology is applied. The technology is characterised by high efficiency and high economic performance, which might be advantage for its wider application for heat and electricity generation. Technology has been developed by SME Zespół Innowacyjny "PROMIS" Sp. z.o., Warszawa and has a long track of application /40/.

Summary of Positive Aspects There is very high potential of biogas in Poland, which gives a good base for development of this type of renewable energy sources. However, sector of biogas is still not fully developed.

It is observed dynamical increasing of presence of German and Danish companies, which create Polish subsidiaries located namely in Western and Northern part of Poland, in the region having well developed agriculture industry (e.g. Wielkopolskie Voivodship). It might assure development of local experience in the near future and development of local suppliers of biogas investment goods and construction services.

Additional to that, it is important to stress, that on majority of the WWTPs producing biogas, Polish origin desulphurisation technology is applied. The technology is characterised by high efficiency and high economic performance, which might be advantage for its wider application for heat and electricity generation. Technology has been developed by SME Zespół Innowacyjny "PROMIS" Sp. z.o., Warszawa and has a long track of application /40/.

Summary of Negative Aspects To understand position of biogas in Poland and identify possible obstacles in development of this sector, it is important to stress, that Polish natural gas distribution network is well developed and most likely in near future it will be a surplus of natural gas on the market. It is observed that current supporting instruments (certificates and soft loans from environmental funds) are not efficient enough while biogas is considered. Thus stronger economical and/or financial incentives as well as direct regulations should be applied to promote use of biogas in order to achieve required level of its share in energy mix.

In Poland, main negative aspect, which harm dynamic development of biogas sector is lack of investment capital. Generally, Poland requires a lot of investment in infrastructure and improvement of existing facilities to comply with EU regulations. In order to mobilize private capital for such investment more favourable conditions are needed. Private capital usually expects high return on capital in short period of time (less then 5 years) but currently economical efficiency of biogas plants in Poland is low. It results from low price for heat andelectricity in Poland.

Therefore, it is high expectation of private investors, based on EU policy, which supports by numerous incentives such investments, for receiving significant subsidizes for such plants either from EU programs or from ecological funds. But available resources are limited and existing in Poland mechanism (tradable green certificates TGC) is not efficient with respect to biogas.

Most prominently existing in Europe supporting mechanisms may be grouped into two major categories, tradable green certificates (TGC) and feed-in tariffs (FiT). Experiences from a number of countries in Europe suggest that FiT deliver larger and faster penetration of RE than TGC, at lower cost /41/. Additionally to that, dominating gas distribution only by one company also leads to slow pace of wider application of biogas. It is due to low interest of company in such activities resulting from low economical efficiency of this type of investments.

The gas grid is operated by one company - PGNiG S.A. (Polskie Górnictwo Naftowe i Gazowe S.A.) - largest Polish oil and gas exploration and production company). At the end of 2010 long term (up to the year 2037 on the base of principle “take or pay”) contract with Gazprom (main supplier of natural gas to Poland) for increasing gas volume up to 10.7 billions m3/a (greater then current demand) has been signed. Due to this fact, currently PGNiG has no economic interest in development of utilization of biogas and it is rather interested inpromoting use of natural gas. It is observed in form of creating of join-venture for construction and exploitation combined heat power station. From other hand PGNiG has established subsidiary dedicated to develop biogas business while conditions will be more favourable.

In result of review of current situation in biogas sector, conducted within SEBE project, several barriers and obstacles (organisational, technical, legal and financial) which hamper in development of biogas sector in Poland have been identified. These barriers and obstacles were mentioned in chapter 3.3. of this report.

It should be stressed that key problem is related to lack of effective, having long term perspectives financial instruments including subsidies. Tradable green (or other) certificates (TGC) system is to complex and does not guarantee stable income to electricity producer. It also requires support of highly qualified layers and experts, which prevents most of individual private investors from using it (apart from big companies, which specializes in such investment).

Most recently new type of tradable certificate has been introduced /42/ (so called purple certificates), which is specially designed for cogeneration plants using also unconventional methane resources as coal-bed methane and biogas. However, thesecertificates do not remove main obstacles related to this type of instruments using Energy Stock Exchange in order to get cash instead of use simply mechanism as feed-in-tariff applied in most European Member States.

It must be noted, that the most important factors for economy of biogas plant are the prices of electrical energy and prices for natural gas and their interrelation, what it is expected to change in the future due to EU climate policy.

General background and introduction
The story of the biogas technology in Poland began in the 80s of XX century, when several small agricultural biogas plants were built. These plants did not bring the expected results because of economic problems of farms. One of the first biogas plants in wastewater treatment plants was launched in 1998 in Inowrocław (320 kW electric power, thermal power 540 kW). Whereas one of the first biogas plant using landfill gas was launched in 1996 in Braniewo, The gas was used for heating production - installation of 1.3 MW power providedheating and hot water for 65% of 18-thousand residents of the city.

Currently in Poland according to data elaborated by the Central Mining Institute (GIG) in 2010, there are operated about 155 biogas installations, including 78 plants in landfills, 67 biogas plants on waste water treatment and 15 agricultural biogas plants. The list of Energy Regulatory Office includes 136 biogas plants, but these data refer only to entities generating electricity. Biogas is used for heat production as well as combined heat and power production. There are no other ways of biogas utilization in Poland at this moment.

Generally, the applied technologies of biogas production in Poland based on traditional anaerobic digestion process. However, the situation in this field is changing rapidly and in new plants, imported advanced technologies are implemented.

It is important to stress, that on majority of the WWTPs producing biogas, Polish origin desulphurisation technology is applied. The technology is characterised by high efficiency and high economic performance, which might be advantage for its wider application for heat and electricity generation. Technology has been developed by SME Zespół Innowacyjny "PROMIS" Sp. z.o., Warszawa and has a long track of application /1/.

Research trends are closely related to industrial demand and biogas market. The experts provide assistance for developers, investors and operators of biogas plants in Poland. Key-issue is the efficiency of an operating biogas plant, which depends on a number of factors among other the type and accessibility of the substrates, waste utilization degree, method of use of the produced energy.

In the last few years in Poland, it is noted, the significant growth of biogas production from all sources. The most promising future development will be based on agricultural biogas plants. There are 184 biogas plants in planning phase. Average size of the planned biogas plants is 1.6 MW, it seams such capacity of plant is economical in Polish conditions taking into considerations availability of substrates as well as ability to utilise produced electricity and heat.

Poland has a large energy potential of biogas from agriculture biomass, sewage sludge from WWTPs and municipal waste, which from all these sources is estimated at 52,000 GWh/a (187 PJ) /2/. The most significant is agricultural biogas potential, which amounts to 48,600 GWh/a (93%). The high potential of biogas from agricultural and food in dustries in Poland, gives a good base for development of this type of renewable energy sources. Recently, it is observed dynamical increase of presence of foreign companies (mainly German and Danish) offering advanced biogas technologies.

The development of biogas is a chance for Polish agriculture and business, both to achieve the income, as well as the application of novel technologies.

It is high expectation of private investors for receiving significant subsidizes for such plants either from EU programs or from ecological funds. But available resources are limited and existing in Poland mechanism (tradable green certificates TGC) is not efficient with respect to biogas. Most recently introduced new type of tradable certificates (so called purple certificates) do not remove main obstacles related to this type of instruments.

Currently Ministry of Economy is preparing National Action Plan on Renewable Energy Sources (RES) conferring a significant role of biogas produced by anaerobic digestion /3/.. Document stipulates instruments for wider application of renewable sources of energyand introducing flexible financial and economical instruments for supporting RES including biogas.

Most recently, it is observed growing interest in developing of agricultural biogas plants and Ministry of Economy with cooperation of Ministry of Agriculture and Rural Development worked strategic document entitled “Directions of development for agricultural biogas plants in Poland between 2010-2020”, document has been accepted by the Council of Ministers on 13th July, 2010 /4/. Ministry of Agriculture is optimistic, it is estimated that in the near future, about 2,000 biogas plants will be constructed.

Biogas production for energy generation
Currently, in Poland biogas is produced mainly from sewage sludge on WWT plants (67 biogas plants) and on landfills (73 biogas facilities). There are only 15 agriculture biogas plants. Biogas is used for heat production and in combined heat and power production. This trend goes in line with the current support schemes on renewable energy according to URE (Energy Regulatory Office). Total power capacity of all biogas plants amounts to 130 MW (90 MWel and 40 MWth).

Biogas production from sewage sludge

Generally, the applied technologies of biogas production from sewage sludge are classic anaerobic digestion process. The first step is pretreatment, which can be significant when feedstock is not only sewage sludge but mixture of sewage sludge and other materials.

The main step of the process is anaerobic digestion, where the material is naturally degraded (digested) by bacteria in sealed airtight vessels. The digestion process is comprised of several distinct phases: hydrolysis, acidogenesis, and methanogenesis. A single-stage digester carries out all stages of digestion in a single vessel, a multistage digester aims to optimise the process by different vessels carrying out different parts of the process. Typically a multistage digester has two vessels optimising the two processes set out above.

Taking into consideration of thermal conditions and retention time of the process, two types of systems are applied: mesophilic and thermophilic systems – mesophilic systems operate at around 35°C and require little external heating; thermophilic systems operate at 55°C and require considerably more heating energy. Mesophilic systems tend to produce less gas and have a retention time for the material being digested of 15-30 days. Thermophilic systems tend to produce more gas and, although harder to control, do have a shorter retention time of 12-15 days.

Traditional digesters used in the sewage treatment industry are low solid, single stage, mesophilic digesters. However, as the range of material being digested has increased and the economics of using the gas for power and energy has grown, systems have moved to try to obtain better gas yields. This has seen a move to higher solids systems, with multistages and thermophilic processes. However, there is still considerable scope for continuing to optimise systems for better gas production.

The raw biogas to make it suitable for use in engines for co-generation of electricity and heat is directed to post treatment for removal of hydrogen sulphide and water vapour in order to avoid corrosion in compressors, gas storage tanks and engines. On the first place we should mention Polish method BIOSULFEX /5/ which is the advanced liquid redox technology for hydrogen sulphide developed in oil and gas processing and power generation. The BIOSULFEX has been developed by PROMIS Sp. z o.o., and implemented in 16 biogas plants in WWTPs in Poland. In this method hydrogen sulphide is converted only to elemental sulphur using unique pulver concentrate BIOCAT. BIOSULFEX is environmentally friendly method and doesn’t produce neither off gases nor sewage.

Biogas production from organic waste and agricultural biomass

Production of biogas from different organic waste and agricultural biomass can be conducted by two kind of anaerobic digestion processes:

· Wet biomass fermentation,

· Dry biomass fermentation.

Wet biomass fermentation

The wet process is based on similar principles, such as sewage sludge digestion chamber (called WKF). Substrates (waste) after appropriate hydration are subject to anaerobic decomposition in a closed chamber, and the resulting degradation of biogas can be utilised.

In result of carried out within SEBE project review on technologies, three wet biomass fermentation technologies have been identified as well known on Polish market and in some cases implemented. These are:

· WABIO technology,· IMK technology,

· Smack technology.

The WABIO technology is based on the fermentation of organic fractions recovered from mixed municipal waste /6/. Light fraction and heavy fraction, which are ballast, are disposed in landfill. Heavily hydrated organic fraction is subject to a fermentation process.

The IMK technology is used for organic waste separately collected /6/. The fermentation process takes place under the same rules as in technology mentioned above. Production capacity allows to apply of IMK technology in medium and large cities.

To the technologies of wet fermentation we can rank also advanced biogas technology of Smack Biogas GmbH, which is offered on Polish market and implemented in the largest biogas plants (power capacity 2,1 MW) in Poland in Liszków /7, 8, 9/. Feedstock for this plants are vegetable origin wastes and brew from distillery. In terms of investor service is the full investment process, including waste management, service and running a business.

Dry biomass fermentation

To the technologies based on dry biomass fermentation, applied and/or offered in Poland are numbered:

· SWECO,

· Zeneris,

· Electra,

· BIOFerm,

· MT- Energie.

SWECO

From supplied waste are built so called energy heaps equipped with the facility to capture the biogas and to recirculte leachate /6/. The heap is isolated from the environment. Due to maintain a sufficiently high temperature recirculated to the heap leaching water is heated. Unlike the wet fermentation process, this process is long and takes about 5 years. In fact, the process does not differ from the phenomena occurring in a typical landfill. The difference is more control and more effective use of the resulting biogas.

The technology SWECO (Sweden) has been applied for disposal of waste from the city of Elbląg (investment in Braniewo commissioned in 1995) and from the city Grudziądz (investment committed in 1996).

ZENERIS

In comparison to other known solutions, the technology developed by BIOGAZ ZENERIS differs in its approach to the feedstock – it covers a wider range of substrates used, as well as optimisation of substrate composition directed to the fermentation chamber, while keeping the lowest possible cost /10/. The technology of farming-disposal biogas plant allows to produce electricity from renewable sources, as well as to utilize organic wastes. The ZENERIS technology was implemented in biogas plant located at the distillery in Skrzatusz (Szydłowo municipality, district Piła, Wielkopolskie) (Figure 2-1).

Figure 2-1 Biogas plant in Skrzatusz /10/

The power capacity of the plant is 526 kWe producing electricity at high efficiency cogeneration. As substrates are used mainly wastes from food processing industry: brew from distillary, potatoes pulp, waste from carrot and slaughter. Corn silage is used only for additionalload of fermenters. The processing capacity is 24,000 Mg/a, what allows to produce 4 GWh of electricity.

ELECTRA Biogas plants operating in technology ELECTRA, developed by the Consortium Project-Executive Ekoenergia-SANECO, is one of the advanced solutions for processing biomass plant and animal products and other of organic waste by mesophilic methane fermentation/11/. ELECTRA is a zero waste and odour technology. In terms of technology applied at the moment technology in Europe, is one of the few, which resolved completely management problem substrates high nitrogenated. Plan of the biogas plant based on ELECTRA technology is presented in Figure 2-2.

Figure 2-2 Plan of the biogas plant - ELECTRA technology /11/

The process is hermetic and one-step (without additional degassing). Due to the used solution concerning preparation of feedstock to the digester, the time of fermentation was shortened, which results in reducing investment costs. Receptive selection of feedstock supplyingfermentation chamber allows on more efficient biogas production.

The technology was applied in WWT plant in Żyrardów (Figure 2-3), and is planned to be implemented in a number of agricultural biogas plants located in Western and Northern parts of Poland.

Figure 2-3 WWT plant in Żyrardów where ELECTRA technology was applied /11/

BIOFerm

BioFerm company belongs to a group of companies Viessmann and offers advanced technology for biogas production by dry fermentation process /12/. For the production of biogas, this technology demands minimum requirements for substrates what in result reduces the use of materials such as food or feed.

BioFerm technology is based on fermentation process of dry biomass. In this process, unlike wet fermentation, as the raw material (feedstock) can be use primarily organic waste, the remains of the crops, care of greenery, or even manure containing up to 60% dry matter. It is not any additional requirements concerning the sorting of ingredients before being placed in the digester.

Figure 2-4 Scheme of dry fermentation biogas plant /12/

The fermentation process is divided into several separate digesters, due to assuring a stability of the quantities of produced biogas. The BioFerm technology guarantees high content of methane - over 60% in the produced biogas. Scheme of dry fermentation biogas plant based on BioFerm technology shows Figure 2-4.

MT- Energie

Biogas Technology of German company MT-Energie based on two-step process. Usually, three tanks are used: fermenter, secondary fermentation tank and post fermentation storage tank /13/.

The main difference between classic two-stage process and this scheme is that in the fermenter and in the secondary fermentation tank are the same conditions for the life of bacteria. The atmosphere in the fermenter does not contain hardly no oxygen. The substrate hasa constant temperature (40-42°C) in the mesophilic range and neutral reaction of pH (6.5 -7.5). Scheme of MT-Energie biogas technology shows Figure 2-5

Figure 2-5 Scheme of MT-Energie biogas technology /13/

WELtec BioPower

WELTEC technology based on three-step AD process. The fermenter wall is constructed in two different materials (stainless steel) due to the different operational demands in the liquid content area and in the area of the gas phase /14/. Efficient mixing of the fermenting substrates and forms the basis for an even yield of gas is ensured by use of a combination of long arm and submersible agitators. Scheme of fermentation chamber based on WELTEC technology shows Figure 2-6.

Figure 2-6 Scheme of fermentation chamber - WELtec BioPower /14/

The biogas process depends essentially on a constant temperature control. Due to achieve a stable thermal efficiency in AD process, an amply dimensioned tubular heating system in the bottom third of the fermenter and external insulation with moulded polystyrene boards is applied. The supply temperature is regulated by a mixing valve in order to eliminate fouling of the piping due to excess temperatures and prevent damage to the biology. The heating output usually facilitates the thermophile process at approx. 55°C. Several individual factors determine the optimal operation of a biogas plant. To ensure that these factors are optimally matched with each other the plants are equipped with a central control system that controls and manages all processes.

To convert the biogas produced in the plant to electricity and heat energy a Combined Heat and Power Unit produces up to 2 MW of power and thermal energy is applied. The heat produced during power production is transferred via a heat exchanger and optionally via anexhaust gas heat exchanger to the heating system. Possible surplus heat can be used in different systems.

Regarding the issue of availability of technologies it should be noted that on Polish market there are a lot of offers of foreign technologies, mainly German and Danish but only a few technology are locally developed.

Commonly used raw materials for biogas production

At present the main feedstocks for biogas production in Poland are: sewage sludge and waste on landfills. However, due to the rapid growth of agricultural biogas plants, in the near future for biogas production the following raw materials will be commonly used:

· waste from livestock production: manure, slurry, chicken droppings dry, etc.

· energy crops: mostly corn silage and rye,

· waste from food production: waste containing fats, starch or protein not containing inhibitors

- such as food leftovers; brewers grains and beet pulp, waste fats, some  slaughter wastes from category K2 and K3,

· waste from the production of biofuels: glycerol and brew from distillation.

The Table 2-1 presents the list of raw materials used in the three largest agricultural biogasplants belonging to the company Poldanor /15/.

Table 2-1 Specifics of selected biogas plants – Poldanor Company /11, 15/

Selection of substrates for technology of biogas production is a key issue. In Figure 2-7 toFigure 2-9 the basic substrates belonging to three categories mentioned above and their productivity are presented /16/.

Figure 2-7 Productivity of basic biogas substrates – agricultural waste /16/

Figure 2-8 Productivity of basic biogas substrates – energy crops /16/

Figure 2-9 Productivity of basic biogas substrates – food industry wastes /16/

The use of a given substrate is determined by its availability and cost of acquisition.For the operator of biogas plants, the selection of substrates is usually limited to inventory their own resources of substrates originating from agriculture or manufacturing plant. In the case when the quantity and efficiency of substrates is not sufficient for the planned biogas power plant, the feedstock is supplemented by substrates available in the vicinity of the planned biogas plant. There is no simply answer about optimal substrates. Decision shouldbe based on the detailed design and analysis of specific location of the biogas plant. Certainly, several factors should be taken into account: the amount of available additional fuel, distance, cost of production, quality and properties of the substrates, the security of supply for several years. Evaluation of the usefulness of the substrate will be done by the technologist and the designer. But considering the possible options, we have to remember about the diversity of substrates in terms of their properties and usefulness in the process of biogas production.

Ownership of infrastructure and investment costs

In Poland biogas is produced mostly in landfills, in second place in sewage treatment plants and in the smallest part in the agricultural biogas plants.

Throughout the country in 2008 there were 803 active landfills, of which nearly 90% is owned by the public sector and the remaining 10% is the private sector /17/. The administrators of most landfills are Municipal Waste Management and Waste Water Treatment Companies(Przedsiębiorstwa Gospodarki Komunalnej i Miejskie Zakłady Oczyszczania).

In 2009 around 67.8% of sewage has been treated by private sector entities, every year the number of individual home sewage treatment plants increases (an increase of 19% in comparison to 2008) (Figure 2-10)/18/.

Figure 2-10 Waste water treatment plants by ownership (GUS) /18/

In Poland there are 10 agricultural biogas plants which produce significant amounts of biogas, the majority of them are the property of private company Poldanor. The construction of an agricultural biogas plant involves serious investments. In case of agricultural bogasplants of the Poldanor company the investment cost in respective installations are presented in Table 2-2.

Table 2-2 Investment costs of the agricultural biogas plants – Poldanor /15/

The height of the investment depends not only on the size of the installation but also on the location, substrate access and applied technology. Figure 2-11 presents the structure of investment costs /19/.

Figure 2-11 Structure of investment costs (IEO) /19/

To the remaining investment costs belong the costs of project documentation, purchase of the measurement equipment, start, infrastructure and other.

According to the experience of the Poldanor company and the estimate analyses conducted by the Polish government, the construction cost of an installation with the capacity of 1MW is around PLN 14 million.

Poldanor in contrast with other competitive companies has relatively low investment costs, this follows from the fact that it single-handedly orders the equipment and organises works. For the sake of comparison, the construction of 2.1 MW capacity biogas plant in Liszków by Agrogaz company consumed PLN 28 million. The biogas plant next to the waste water treatment plant in Inowrocław cost PLN 2.4 million, and one in Braniewo at landfill PLN 1.9 million. The two latter are already older installations.

Another example of agricultural biogas plant opened in November 2009 is the Studzionka biogas plant. The investment was fully covered by the owners of the farm, and cost PLN 400 000. The biogas produced in the installation is obtained from poultry litter and pig manure. The gas purified from sulphane is fed to 30 kW cogeneration aggregate. In the end product, the methane content amounts to around 55% and from 1m3 of biogas 2 kWhel are produced /20/.

The entities leading agricultural biogas plants can apply for funding from the National Fund for Environmental Protection and Water Management which allocated PLN 0.5 billion for grants and loans for construction, development or conversion of electricity or heat generation facilities using agricultural biogas with the exclusion of demethanation of landfill and the construction, development, or conversion of installations producing agricultural biogas in order to introduce it to the distribution and direct gas network /21/. An example here can be the biogas engine installed in the Warta Waste Water Treatment Plant in Częstochowa which cost PLN 3.7 million of which the financial support from the Regional Fund for Environmental Protection amounted to PLN 1.39 million in loan and PLN 400 000 ingrant. The plant’s own funds were PLN 1.925 million. The owner of the Warta company is the city which has 100% of the company’s shares /22/. Also National and Regional Operational Programmes and commercial banks provide funding for biogas investments.

Efficiency and sustainability of plants

The efficiency of an operating biogas plant depends on a number of factors among other the type and accessibility of the substrates, waste utilisation degree, method of usage of the produced energy and the social and ecologic benefits. Among the ecologic, economicand social benefits are:

· protection of the Earth’s climate through limiting the uncontrolled emissions of CO2,  CH4, N2O;

· protection of the current state and aesthetics of local environment through natural  sanitization of animal faeces and eliminating odours;

· limitation of the activity of patogens and pests in natural fertilizers,

· local diversification of energy sources, independence from conventional fuels;

· increasing the workplace number;

· additional income for agricultural companies (promotion of agricultural market) and  self-government;

· production of methane from renewables i.e. in an environmentally friendly method

· using the post-fermentation waste as organic fertiliser;

· increasing the control and recycling degree of the organic matter and mineral components;

The data from the Poldanor company shows that running a biogas plant beside a number of environmental benefits can also provide economic benefits namely profits. Annual business account of operation for a 625kW capacity biogas plant is shown in Table 2-3 /23/.

Table 2-3 Operational results of agricultural biogas plant – Poldanor /23/

Operational costs consist on average 8 – 10 % of the investments that is around PLN 1.4 million and are mostly related to the substrate type and acquisition method, amortisation and maintenance of the equipment used as well as waste utilisation.

Energy sector company producing electricity from renewables with the total electrical capacity below 5MW is free of the concession fee and the annual fees from concession owners. The electricity produced from renewables is free of excise duty on the basis of thedocument confirming the discontinuation of the certificate of origin of the energy /24/. The biogas plant income in Poland follows from the sales of electricity (regulation price of the Energy Regulatory Office 0.19721 PLN/kWh /25/) and thermal energy (0.10-0.18 PLN/kWh),sale of green certificates (in the future red certificates), as well as post-production waste utilization 120.00 – 400.00 PLN/tonne. The basic problem and the main target for increasing the economy efficiency of a biogas plant should be the search for methods for increasing the use of the produced thermal energy.

Biogas as vehicle fuel
Biogas used as a transport fuel has to be upgraded to at least 95% methane by volume and it can then be used in vehicle originally modified to operate on natural gas.

There is no bio-methane or any biogas upgrading plants under construction in Poland and thus bio-methane is no used for transportation purposes. However in some regions of Poland, the existing natural gas vehicle fuelling stations can play an important role for the development of biogas use as a vehicle fuel /26/.

In Poland, currently about 1500-1700 vehicles are powered with compressed natural gas (CNG). Today in CNG is distributed in 33 public filling stations /27/ and 13 stations inacessible to the public, operated by different companies, including two stations by the Fiat Auto Poland. The largest number of the stations is located in the Carpathian Gas Company. At the moment 280 buses are running on CNG in 21 Polish cities. Based on data available from the CNG stations we can estimate the number of individual customers at about 700 peoples.

Until 2014, it is expected to create 20 new stations in the vicinity of large cities in Poland.For the promotion of CNG driven vehicles, PGNiG SA offers refund of figure of 1,500 PLN by the assembly of CNG installation. Currently, the price per 1 m3 of gas at all stations is2.40 PLN (1.97 netto PLN) /28/ and by October 2013 CNG is supported by the zero rated VAT.

Key figures on use of CNG as vehicle fuel in Poland are presented in Table 2-4.

Table 2-4 Key figures on use of CNG as vehicle fuel in Poland /28, 29/

The number of CNG vehicles increases due to the national and EU programs, which support activities for the reduction of emissions to air and increase the share of renewable energy sources. This leads to the development of distribution networks and CNG stations.

Considering the development of use biogas as vehicle fuel in Poland, the infrastructure available for compressed natural gas offers synergies concerning the distribution of biogas as a vehicle fuel in the future. The combination of biogas refueling stations and CNG refueling stations creates promising opportunities for introducing use of biogas. But, before everything else, implementation of biogas use as vehicle fuel in Poland needs political aspiration for promotion of this fuel associated with economical incentives.

Biogas to biomethane
At present in Poland, there are no plants upgrading biogas to bio-methane. Thus biogas is not used as bio-methane and feed-in into natural gas grid.

Biomethane to be accepted by natural gas pipeline system should comply with following standards and regulation:

· Minister’s of Economy Regulation issued on 2 July, 2010 on detailed conditions of functioning of gas system (Dz.U./ Official Law Journal of 2010, No 133, item 891/       Rozporządzeniu Ministra Gospodarki z dnia 2 lipca 2010 r. w sprawie szczegółowych warunków funkcjonowania systemu gazowego (Dz. U. z 2010r. Nr 133 poz. 891).

· Polish standard PN-C-04750: Gas Fuels. Classification, marking and requirement/  Paliwa gazowe. Klasyfikacja, oznaczenie i wymagania,

· Polish standard PN-C-04753: Natural gas. Quality of gas delivered to user by gas distribution   system / Gaz ziemny. Jakość gazu dostarczanego odbiorcom z sieci rozdzielczej

However, analysing the particular regional gas distribution infrastructure, it must be stated that possibility to connect to the gas grid exists mainly in towns and in municipalities located in centres of voivodships gas networks. In some cases gas grid is not available in rural areas located close to border regions and it might be opportunity to develop local system for utilisation of biogas.

It should be noticed a lack of legal regulations on feed-in of biogas into natural gas grid. However, we can expect that such regulations will be developed in the near future.

Project examples
Example 1

Example 2

Example 3

Example 4

Exemple 5

Country characteristics
In general the agricultural biogas investments are a new type of activity in Poland. However, this sector has been given a great attention recently, which resulted in many legal, organiza-tional and financial solutions facilitating development of biogas projects in Poland.

The investment cost of biogas plant are relatively high amounting to 15 million PLN for a 1 MW electricity installed, which is equal to 3.75 million EUR. If the capacity is lower the relative investment costs are even higher. This means biogas plants are very expensive investments.

The general opinion is that without a subsidy the biogas plant investment cannot give a positive financial outcome. Therefore founding in the form of grants is regarded crucial for the ag-ricultural biogas plants development in Poland. Especially the grants available under the Op-erational Programme “Infrastructure and Environment” are considered the most attractive source of financial support. The total level of subsidy can even reach 70% in case of small and medium enterprises in some selected regions.

The refundable support instruments, such as bank loans, are also important, however most of the biogas investment proposals are applying in the first place for the grants. If the proposal is not ready for a given call or has been rejected due to some reasons, in the second place the investor is applying for loans with subsidized interest rates.

It should be also mentioned that the project that is applying for the financing, regardless the programme or institution, has to be relatively much advanced in preparation. It means the feasibility study has to be prepared, the environmental decision has to be granted, the building project has to be accepted and the building permit granted, etc. In general, the better ad-vancement of the investment in terms of the administrative procedures, the better position of the project and higher chance for granting the financing. The investor has to be prepared to cover the expenses for the project preparation (feasibility study, environmental impact review, building project, etc.) from his own sources. These activities typically have to be done before applying for the financing from the banks or EU founds.

Typically the administrative procedures need several months up to 2 years to be completed, thus, there are in practice problems to gather all the necessary documentations within the re-quired time. For example, the rules of the PO “Infrastructure and Environment” Activity 9.4, which is relevant for renewable energy projects, require that the complete documentation of the investment in terms of administrative procedures has to be submitted within 12 months from the date of the call announcement. In practice in some cases this happened to be im-possible for the investor and the project was rejected.

Summary of positive and negative aspects
Summary of positive aspects
 * Renewable energy projects, including biogas investments, are offered funding from several financial schemes in Poland. Non-refundable as well as refundable financial instruments are available.
 * Significant contribution to the renewable energy projects development come from Operational Programme “Infrastructure and Environment”. So far, the most important support for biogas projects has come from Activity 9.4 "Energy production from renewable sources". Two calls for proposals have been announced under this activity. The financing can reach even 70% of the total eligible investment costs.
 * More than 10 agricultural biogas investments were submitted to the first and second round of call for proposals under the Activity 9.4 "Energy production from renewable sources". In total 12 biogas projects were evaluated high amounts of points and were placed on the primary ranking lists, which makes them eligible them for second stage evaluation and finally for fund-ing is positively verified.
 * Apart from the Activity 9.4, biogas projects designed as a high efficiency cogeneration units can apply for a support from Activity 9.1. There is also a possibility to obtain financing for the industry producing equipment for the biogas plants under the Activity 10.3.
 * Loans are offered from the National Fund for Environmental Protection and Water Manage-ment. In opposite to the OP “Infrastructure and Environment” the investment can be in a rela-tively early stage of development when submitted. The procedure allows that first the project is granted a promise of a loan and then the applicant has to obtain and submit all other required documentation on the investment, which has to happen within 15 months at the latest from the request of the Found. BOŚ Bank offers loans with preferential interest rates subsidized by the National Fund for En-vironmental Protection and Water Management.
 * BOŚ Bank offers free-of-charge assistance of specialists (ecologists employed by the bank) in drawing up the proposal of ecology-oriented projects. Commercial loans are available from other commercial banks.

Summary of negative aspects Further topics
 * Under the Activity 9.4 all types of renewable energy projects compete together for the availa-ble founding. This means that biogas projects are put together with wind projects and others. Under these conditions biogas plants, which are relatively expensive investments, perform quite badly with the indicator of the investment costs per 1 MWel installed compared for ex-ample to wind turbines.
 * The administrative procedures, such as granting environmental decision and granting the building permit, typically last several months. In some cases it may be a limiting factor for to submit the necessary documentation to the funding institution in the required time, which typi-cally is 12 months from the call announcement day.
 * The projects submitted to the OP “Infrastructure and Environment” are granted additional points if they are relatively advanced in terms of preparation. Project having the environmental decision, building permit, connection to the grid have better chances to be placed to the primary list of project, which are allowed for second stage evaluation. However, obtaining all the administrative procedures is a considerable pre-investment cost related to the preparation of construction design, environmental impact review, etc.
 * Only a few Regional Operational Programmes offer financial support for renewable energy projects.
 * The initial schedule of the call for proposal under the OP “Infrastructure and Environment” for Activity 9.4 was not respected. The calls were postponed even with several months. There were changes in the rules and application forms of the calls.
 * Biogas projects are expensive investments, which under Polish conditions need to be financed with a non-refundable financial support. A commercial load itself is not enough to guarantee a positive financial return from the investment.

Some recommendations for the improvement of the financial schemes for biogas projects in Poland:


 * It is crucial to keep the schedules of the calls and contest under different financial support schemes and avoid delays. On the other hand, the information about planned calls has to be published few months in advance. Preparation of the investment for founding requires con-siderable time, especially in terms of obtaining all relevant administrative decisions.
 * There are difficulties with the financial engineering of projects submitted to the financial schemes. There are great uncertainties concerning the available support system in the form of green and other certificates. According to the state of art the green certificates system is guaranteed till 2019 and the yellow ones till 2012 while the investment lifespan is typically 20 years or longer. There is a need for defining clear and long-term policy regarding financial support for biogas sector.
 * There is a great need for supporting promotion activities for the development of biogas plants, including good practice examples and demonstrative projects. Biogas plants are still a very new type of activity in Poland and often raise local conflicts, which can hinder the investment in each stage of development.

General background
The financial support policy from the national government includes mainly grants for business activities and tax reliefs.

The changing political and economic situation after the year 1989 (the transformation from central planning economy to free market economy) fosters the revival of economic activities. Therefore, an important role of the financial support policy in Poland is supporting small and medium enterprises (SMEs) activities. The main target of this policy is to stimulate economic activities of SMEs together with increasing the job creation in this sector and increasing its competition and the capacity to operate on the common European market.

For the first time the support for SMEs was started in the period 1995-1997 and are under continuation up to date. The support is addressed to all small and medium enterprises, what-ever is the localization, the legal form of the enterprise and the type of activities. The sources of the financial support are: the national budget, European founds, international bank loans and private companies founds. The total support for a SME cannot exceed 100,000 EURO in the period of three following years, whatever the support form is and its purpose /1/.

The national government activities offered to the SME include /1/:


 * Advise support for a given activity,
 * Facilitating access to external financial sources,
 * Supporting export development,
 * Prompting the quality of products.

Tax reliefs are offered in the Special Economic Zones, in which business can be conducted on preferential terms, i.e. tax exemptions are available. Special economic zones were established to boost economic development in some regions of Poland.

Concerning renewable energy sector the most significant support from the national govern-ment is offered as the national budget contribution under the Operational Programmes. In this case national support is a supplementary to the financial sources from the EU founds (see below). Renewable energy investments are eligible for financing under the Operational Pro-grammes “Infrastructure and Environment”, Regional Operational Programmes as well as De-velopment Programme for the Rural Areas.

Financial support policy from the national government
The financial support policy from the national government includes mainly grants for business activities and tax reliefs.

The changing political and economic situation after the year 1989 (the transformation from central planning economy to free market economy) fosters the revival of economic activities. Therefore, an important role of the financial support policy in Poland is supporting small and medium enterprises (SMEs) activities. The main target of this policy is to stimulate economic activities of SMEs together with increasing the job creation in this sector and increasing its competition and the capacity to operate on the common European market.

For the first time the support for SMEs was started in the period 1995-1997 and are under continuation up to date. The support is addressed to all small and medium enterprises, what-ever is the localization, the legal form of the enterprise and the type of activities. The sources of the financial support are: the national budget, European founds, international bank loans and private companies founds. The total support for a SME cannot exceed 100,000 EURO in the period of three following years, whatever the support form is and its purpose /1/.

The national government activities offered to the SME include /1/:


 * Advise support for a given activity,
 * Facilitating access to external financial sources,
 * Supporting export development,
 * Prompting the quality of products.

Tax reliefs are offered in the Special Economic Zones, in which business can be conducted on preferential terms, i.e. tax exemptions are available. Special economic zones were established to boost economic development in some regions of Poland.

Concerning renewable energy sector the most significant support from the national govern-ment is offered as the national budget contribution under the Operational Programmes. In this case national support is a supplementary to the financial sources from the EU founds (see below). Renewable energy investments are eligible for financing under the Operational Pro-grammes “Infrastructure and Environment”, Regional Operational Programmes as well as De-velopment Programme for the Rural Areas.

New types of financial instruments
Refundable financial instruments include mainly loans with commercial or preferential interest rates. The loans are given by commercial banks. In the field of renewable energy projects the BOŚ Bank is the most relevant. Apart from commercial loans it offers preferential loans for ecology-oriented projects.

Apart from funding, new types of support instruments include: innovativeness promotion, in-cluding training and advisory centers, Technology Transfer Centers, local loan funds, loan guarantee funds, entrepreneurship incubators, research and technology parks and technology parks.

Since 2000 a number of centers have increased by 91% and the highest dynamics observed in case of the technology parks, training and advisory centers and guarantee funds. Over a half out of the above mentioned centers offers a variety of the financial assistance (loans, guarantees). The centers also offer a typical incubation support – “soft” assistance and space rent, and a similar number – a support for innovative activities. This support is available for different business activities, potentially also for renewable energy projects.

Venture capital funds operate on the Polish market only recently. They invest their financial capital for an early stage and high potential enterprises and renewable energy is in the field of their interest. Business angels are not well established on the Polish market yet.

Preference of local services in public tenders
Based on the Polish law no preferences of local services in public tenders currently are avail-able for biogas investments or other projects. Most often the only criterion of the public tender is price.

One of the major changes to be made is the establishment of biogas investments as an in-vestment of public purpose. This proposal is included in the “Development directions of the agricultural biogas plants in Poland in the period 2010-2020” approved by the Council of Min-istries in 2010 /4/. The aim is to expand the catalogue of public purpose investments with the renewable energy investments. This requires changes in the Law on real estate management. The aim is to create optimal development conditions for distributed renewable energy sources based on locally available resources.

An administrative decision on the localization of a public purpose investment is required in case of the absence of local space management plan. It is very important as many municipali-ties in Poland do not have local space management plan.

Support schemes for enterprises that provide service to plan and implement renewable energy projects
There is no specific support for companies facilitating renewable energy projects develop-ment. However, is worth mentioning that there is a support available for entrepreneurs provid-ing equipment for renewable energy industry.

The Operational Programme “Infrastructure and Environment” offers support under the Activi-ty 10.3. for the development of industry for renewable energy sources. Support is targeted to the construction of modern production lines producing equipment used to produce electricity and heat from renewable energy sources and biofuels. Lines for manufacturing fermentation tanks, cogenerators and other equipment for biogas production plants is eligible for financing.

Specifically the support is available for the construction of facilities manufacturing equipment dedicated for renewable energy sector, involving /5/:


 * Electricity from wind, water in small hydro to 10 MW, biogas and biomass,
 * Heat using biomass and geothermal and solar energy,
 * Electricity and heat in cogeneration using only biomass or geothermal energy,
 * Solid biofuels and liquid biofuels, which are self-contained fuels, excluding equipment used to produce liquid biofuels which are mixtures of petroleum fuels, the production of bioethanol from agricultural products, and pure vegetable oil.

The ministry of Rural Development is the managing institution, while the Ministry of Economy is in the position of implementation institution. The total allocation for Activity 10.3 is 109.6 million EUR, of which public funding is at 46.97 million Euro.

The beneficiaries of this activity can be entrepreneurs. The financing is given as a non-refundable aid. The beneficiary receives payment in the form of development grant as a reim-bursement of incurred and documented eligible expenses or as advance payment for future eligible expenses. The minimum value of the project under this activity is 8 million PLN (2 mil-lion EUR).

The maximum founding level for the projects is at the rage of 30-70%. The maximum amount of support is 30 million PLN (7.5 million EUR).

Formal and substantive (I and II stage) evaluation of grant applications will be made on the ba-sis of project selection criteria that were set out in Annex 1 to the Detailed description of priorities for the OP “Infrastructure and Environment”. After evaluation a ranking list of primary and reserve projects is published, and on this basis projects are recommended for funding.So far, the first call under Action 10.3 has been announced and completed.

15 applications for funding for a total grant amount of 172.6 million PLN (43.15 million EUR) were submitted in the call for proposals ending 30 November 2010. There were 3 applications for funding submitted by micro-entrepreneurs, 3 submitted by small companies, 4 applications were submitted by medium-sized enterprises and 5 applications have submitted by large companies. The results of the evaluation have not been published so far.

Local tax incentives and other specialised instruments
Biogas plants can potentially benefit tax incentives if they are localized in the Special Eco-nomic Zones (SSE). The special economic zone is created as a specified part of the national territory, in which business can be conducted on preferential terms, i.e. companies that have been authorized to operate in the zone benefit public support in the form of tax exemptions. Special economic zones were established to boost economic development in some regions of Poland. Creation of special economic zones in Poland is regulated by the Law on special economic zones from 20 October 1994 (Journal of Laws of 1994. No. 123, poz. 600 amend-ed).

The establishment of the zone with a regulation adopted by the Council of Ministers at the re-quest of the Minister of Economic Affairs agreed with the minister responsible for regional de-velopment. The Council of Ministers can in the same procedure liquidate a special economic zone, change its name or will combine with another one.

The main idea of creating special economic zones was striving to alleviate structural unem-ployment in selected regions of the country by targeting new investments there, thanks to a package of financial incentives. The financial incentives favour the businesses authorized to operate in the zone to /6/:

Objectives of the zones were aimed at /6/:
 * total exemption from income tax for the first 10 years of business activity,
 * and 50% exemption for the following years, until the demise of the zone,
 * exemption from property tax.


 * accelerating economic development of the part of the territory through the development of certain economic activities, development of new technological solutions and their use in na-tional economy,
 * increasing the competitiveness of products and services,
 * development of existing assets after - industries and economic infrastructure,
 * creating new jobs,
 * development of unused natural resources within the principles of sustainability.

Currently there are 14 in the Polish special economic zones. They differ in terms of size, loca-tion, nature and conditions of development/investments, road infrastructure and other technical and telecommunication infrastructure.

Actually in Poland no biogas plant is established in the Special Economy Zones.

National policy for financial support of biogas projects
In the strategic document for biogas sector, which is "Development directions of agricultural biogas plants in Poland in the years 2010 - 2020", following sources of financial support are mentioned as relevant for biogas projects /4/:

1. Operational Programme “Infrastructure and Environment”:

2. National Fund for Environmental Protection and Water Management:
 * Action IX: Environmentally friendly energy infrastructure: Activity 9.1 “The highly-efficient power generation” and Activity 9.4 ”Production of energy from renewable sources”,
 * Action X: Energy security, including diversification of energy sources: Activity 10.3 “Indus-try development for renewable energy sources”.

3. Operational Programme for Rural Development:
 * Program for projects in the renewable energy and cogeneration facilities - Part 1,
 * Green Investment Scheme (GIS).

4. BOŚ Bank.
 * Measure 121: Modernization of farms,
 * Measure 123: Adding value to agricultural and forestry production,
 * Measure 312: Creation and development of microenterprises.Measure
 * 321: Basic services for the rural economy and population.

5. Regional Operational Programmes.

Nationally financed support schemes
Non-refundable financing from national sources is available under the Green Investment Scheme (GIS) which is managed by the National Fund for Environmental Protection and Wa-ter Management (NFOŚiGW).

GIS is dedicated for financing following types of activities /7/: The minimum value of investment is 10 million PLN (2.5 million EUR). The first contest was announced in 2010. The total available funding in a form of grants was 36 million PLN (9 mil-lion EUR). In total 62 applications for funding were submitted, accounting for a total value of projects of 1,560 million PLN (390 million EUR).
 * the construction, expansion or reconstruction of facilities producing electricity or heat using agricultural biogas (without installation of gas drainage in the landfills),
 * the construction, expansion or reconstruction of agricultural biogas plant in order to in-troduce the gas into gaseous distribution grid or direct use.

The National Fund for Environmental Protection and Water Management also provides loans under the “Programme for the RES and cogeneration facilities - Part 1”, see chapter 5.2.

Support schemes with co-financing by European programmes on the national level
There are several non-refundable support schemes co-financed by the European Union from the Structural funds. The most important ones are Operational Programme “Infrastructure and Environment”, Regional Operational Programmes and Rural Development Programme. The financing comes from the Cohesion Found.

Under the OP “Infrastructure and Environment” financing of biogas projects is available under Activity 9.1 “The highly-efficient power generation” and Activity 9.4 “Production of energy from renewable sources”. The industry producing equipment and machinery relevant for generating biogas is offered support under Activity 10.3 “Industry development for renewable energy sources”. Activity 9.1 is described below. For Activity 9.4 see chapter 5.1, for Activity 10.3 see chapter 2.2.

Activity 9.1 under the OP “Infrastructure and Environment” is dedicated to support projects for high-efficient combined heat and power generation from renewable and non-renewable sources. It is not expected to support the construction and modernization of heat sources, however it is possible to obtain grants for the conversion of these units into cogeneration units. Biogas projects are very relevant for this Activity.

The National Fund for Environmental Protection and Water Management is the implementa-tion institution for Activity 9.1.

The entities entitled to participate in this activity are /8/:


 * Entrepreneurs.
 * Local government units and their groups - unions, associations and local government agreements.
 * Entities providing public services as part of the responsibilities of local government units.

The total allocation for this Activity is 293.8 million PLN (73.45 million EUR) from the Cohesion Fund. Financial support is available throughout the whole country. The minimum value of the project which may qualify for funding is 10 million PLN (2.5 million EUR) while the maximum amount of financing per project is 30 million PLN (7.5 million EUR) /8/.

The first call for applications under the Activity 9.1 was announced in 2009 and 36 projects were submitted. The total value of the submitted projects amounted to 2,557 million PLN (639.25 million EUR) and the amount of funding requested was 548.5 million PLN (137.13 million EUR). After the formal and I and II stage substantive evaluation 12 projects with total requested funding of 176.9 million PLN (44.2 million EUR) were put on the primary list. There were 6 biogas projects recommended for funding.

The second call in this action ended on 29.10.2010. The projects are currently under formal I stage substantive evaluation.

No call is expected to be announced in 2011.

Each province, which is called voivodship in Poland, has its own Regional Operation Pro-gramme offering funding from the Cohesion Found. Various activities can be co-finance. The beneficiaries are:


 * Local Government Units, their unions and associations,
 * Entities operating under the Act on public-private partnership,
 * Public sector entities,
 * Scientific institutions and universities,
 * NGOs,
 * Public health care,
 * Churches and religious associations,
 * other public entities,
 * private actors (with the exception of the provinces of Silesia, Subcarpathian, Podlaskie, Opole and Pomeranian).

The value of the project with the construction of units producing electricity from renewable energy sources cannot exceed 20 million PLN (5 million EUR) for wind and solar power and 10 million PLN (2.5 million EUR) in case of hydro, biomass or biogas. For projects of com-bined electricity and heat generation the value has to be below 10 million PLN (2.5 million EUR). The maximum share of funding in the regional programmes is 85% of total eligible costs of the project or in accordance with the permissible aid ceiling laid down in regional pro-gramme statue. The financing is offered in a form of grants as a reimbursement of the costs or as an advance payment /9/.

The schedule of calls relevant for biogas projects in 2011 includes /9/:

Under the Rural Development Programme, Activity 321 "Basic services for the rural economy and population" funding is offered, among others, for production or distribution of energy from renewable sources, especially wind, water, geothermal, solar, biogas or biomass /4/.
 * Measure 5.1 Renewable energy sources in the Voivodship of Lower Silesia.
 * Measure 7.2 Improving air quality and increasing the use of RES in the Voivodship of Lesser Poland,
 * Measure 5.3 Clean air and renewable energy sources in the Voivodship of Silesia.

Investment must be located in rural municipalities or urban-rural municipalities with the excep-tion of cities with over 5 thousand of citizens.

Maximum level of funding is 75% of total eligible costs. Furthermore, the maximum amount of aid granted for projects in a given municipality may not exceed 3 million PLN (0,75 million EUR) in total during the period of implementation of the Rural Development Programme /4/.

The scope of assistance includes capital costs, in particular the purchase of materials and execution of construction and assembly, and purchasing necessary equipment.

Successful examples of co-financing from other European programmes
In the first call under the Operational Programme “Infrastructure and Environment”, Activity 9.4., which was announced in 2009, six biogas projects were placed on the primary ranking list and recommender for II stage substantive evaluation within 12 months. After the II stage of substantive evaluation only one biogas project was recommended for financing. The total value of the project is 20.7 million PLN (5.18 million EUR), and the funding in a form subsidy is 60% of the total investment costs. The beneficiary is a small and medium enterprise. The funding contract has been already signed.

In the second call under Activity 9.4 in 2010 six biogas projects were put on the primary list. Currently, they are being prepared for the II stage substantive evaluation.

Key players and their roles in the financial process
The most important units in the process of funding are the institutions responsible for imple-mentation of the funding schemes. They make announcements of the calls and contests, or-ganize project selection and prepare the funding contracts. They are also responsible for the entire process of financial and organizational control of the investments and monitoring of the project effects within the durability period for the projects, typically 5 years.

The Ministry of Regional Development is responsible for the overall implementation of the Cohesion Funding in Poland.

Refundable financial instruments for environmental projects
Loans with subsidized interest rates BOŚ Bank offers loans for investments in environment protection with preferential interest rates subsidized by the National Environment Protection and Water Resources Management Fund (NFOŚiGW). This support is available among others for bioenergy projects, including biogas plants.

The interest rates of the loans are subsidized under the ‘Principles of Providing Co-financing from NFOŚiGW Resources’. These subsidies are provided according to the rules defined for each of the Priority Programmes of the NFOŚiGW. The said Programmes specify Programme budget, level of the subsidies to the interest rate, terms for submitting applications and detailed criteria of project selection. The procedures and application forms can be found on the NFOŚiGW website (http://www.nfosigw.gov.pl/).

It is possible to obtain a loan covering up to 100% of the investment costs, with a preferential interest rate at 1% p.a. The period for the subsidized interest rates cannot exceed 10 years. Loans may be used for procuring the equipment, e.g. required for construction of a biogas plant. There are no preferences as to the legal form of clients’ /10/.

In order to be granted the loan from BOŚ Bank with the subsidized interest rate by the NFOŚiGW the applicant submits an application to the NFOŚiGW to get a promise of the sub-sidy. After that, he signs a contract for the loan with the BOŚ Bank. Additionally, a tripartite contract is sign with the applicant, BOŚ Bank and the NFOŚiGW.

BOŚ Bank the same as with NFOŚiGW cooperates with the Voivodship Environment Protec-tion and Water Resources Management Funds (WFOŚiGW). There are 16 voivodships (main administrative regions) in Poland and each of them has his own found. Most of the voivodships founds give support to the investments in renewable energy resources. WFOŚiGW offer subsidies to the interest loans granted by the BOŚ Bank.

BOŚ Bank offers also loans from 5 lines of KfW (Kreditanstalt für Wiederaufbau) for long-term investment projects involving renewable energy sources or for other ecology-oriented projects. In this case, the client needs to be a small or medium private enterprise employing up to 250 persons. The maximum amount of granted loan cannot be higher than € 250,000. This line of crediting is supported by, among others, the European Commission /10/.

BOŚ Bank offers free-of-charge assistance of specialists (ecologists employed by the bank) to clients in drawing up the proposal of an ecology-oriented project so that it meets technical and legal requirements of the bank. The task of the bank ecologist is to make an assessment that completion of the proposed project will allow for repayment of the contracted loan.

Venture capital founds The venture capital, that is a financial capital provided for an early stage and high potential companies in the area of novel technologies or high technologies industries, may be regarded as an attractive financial support instrument for biogas projects.

Biogas investments are considered high potential investments. They are often established by new companies with limited operating history that are too small to raise capital in the public markets and have not reached the point where they are able to secure a bank loan. In this case the support in the form of a venture capital investment may be an optimal solution.

Concerning the new agricultural biogas plants that are under preparation in Poland the venture capital investment is being considered in some cases. The venture capitalists get significant control over company he invests in and in addition a significant portion of the company's ownership. Usually after establishment and setting for operation the investment is being sold and the venture capitalists makes considerable amount of money.

There are some companies on the Polish market offering venture capital for renewable energy projects. An example of such company is the Polish Investment Found investing in companies aiming at the alternative energy, conventional energy, energy efficiency, energy storage and energy services markets /11/.

Financing from the business angels Business angel is a private person/investor who provides capital for the business start-up and usually gets an ownership equity or convertible debt.

This form of financial support is considered very attractive for biogas plants. Typically the business angel brings to the investment not only the money, but also his experience, technical know-how and other capabilities. This can be especially relevant in Poland where biogas plants are still very new activity (there are only 6 agricultural biogas plants). However, in Poland business angels are a rare type of business activity, thus, their role has been minor, so far. They invest relatively small amounts of money in selected projects /12/.

Other types of financial instruments Another type of financial instrument available for biogas investments is a commercial bank loan. It is typical for the biogas investments that there are three types of financial sources: (i) own resources, (ii) bank loan, and (iii) a subsidy from EU founds. The bank loan is often granted as a commercial loan for a period not exceeding 10 years. Such loans can be granted by different commercial banks which operate on the Polish market. One of them can be men-tioned by name, which is the BGŻ Bank (http://www.bgz.pl/).

Biogas projects can potentially benefit from institutional investors. It is not common in Poland yet, however, this type of financial support may be considered with regard to good develop-ment prospects for agricultural biogas investments in Poland. So far, there are some legal and organizational barriers hindering the institutional investors’ engagement in private investment projects. It is much typical and easier for private investors’ /12/.

Examples of financial instruments
Two examples of financial schemes implemented in Poland are presented below. The first example is a non-refundable grant scheme in a form of subsidies offered under the Opera-tional Programme “Infrastructure and Environment “. The second example is a refundable grant scheme available from the National Fund for Environmental Protection and Water Man-agement (NFOŚiGW). Both schemes provide significant contribution to biogas project devel-opment and implementation.

Example 1: Operational Programme “Infrastructure and Environment“ The first example is funding in a form of grants under the Activity 9.4. "Energy production from renewable sources", the Operational Programme “Infrastructure and Environment “. The in-formation on the activity comes from its statute available at the webpage http://www.pois.gov.pl/.

The aim of the Activity 9.4 is increasing the electricity and heat production from renewable energy sources. Thus, the support is dedicated for investments in the construction of units for electricity and heat production from renewable energy sources. Following investments are eligible within Activity 9.4:


 * the construction or increasing the electrical capacity of units using wind, water in small power plants up to 10 MW, biogas and biomass
 * the construction or increasing the thermal capacity of units using geothermal or solar energy.

The support is dedicated for investments generating electricity in cogeneration units, which does not meet the criterion of high efficiency cogeneration. However, the cogeneration rate (the electrical output to thermal heat output) has to be higher than 0.45. As for project ele-ments, support will cover the service line costs to the nearest existing power grid. The service line must constitute an integral part of the project. The investments have to be located on the territory of Poland.

The institution responsible for the implementation of Activity 9.4 is currently the Ministry of Economy.

Type of beneficiaries:
 * Entrepreneur,
 * Local government units and their groups - unions, association and agreements of local gov-ernment units,
 * Unit responsible for public service of their own local government units,
 * Churches, church legal persons and their associations and
 * other religious associations.

The overall allocation for the Activity 9.4 is 1,897.71 million EUR, including 379.54 million EUR from EU budget, 207.93 million EUR from national budget and 1,310.24 million EUR from private sources.

Projects with a minimum value of 20 million PLN (5 million EUR) are eligible for the support, with the exception for investment in electricity generation from biomass or biogas as well as construction or expansion of small hydro, for which the minimal required project value is 10 million PLN (2.5 million EUR). The maximum amount of support is 40 million PLN (10 million EUR) per project.

The intensity of the funding referred to in points 1-3 can be increased by:
 * 10 percentage points for medium company,
 * 20 percentage points for micro- and small company.

Beneficiary receives a payment as a reimbursement of expenses incurred and documented or certified or as an advanced payment. The possibility of providing funding in advance and the amount of any advance payment is considered individually by the intermediary institution when signing the grant contract with the beneficiary.

Formal and substantive (I and II stage) evaluation of grant applications will be made on the basis of project selection criteria that were set in Annex 1 to the “Detailed description of priori-ties for the Infrastructure and Environment”. Formal evaluation is carried out within 30 days of completing the round of proposal submissions under a call. First stage subjective evaluation is conducted within 14 days after the formal evaluation, and the second stage subjective evaluation is carried out within 30 workdays after the submission of complete project docu-mentation by the applicant.

After the formal and first stage substantive assessment primary and reserve ranking lists of projects are created. The projects on the primary ranking list are projects with the highest evaluation results. For these projects all the required documentation for the second stage substantive evaluation has to be submitted within 12 months. If the project gets positive result on the second stage substantive evaluation it is recommended for funding. Then all relevant documentations for the grant agreement have to be prepared within 2 months.

The first stage substantive assessment includes indicators which, to a great extent, decide on the ranking position of the project. These are: investment costs per 1 MWel installed, invest-ment costs per 1kWh produced and the mean annual time of operation. Biogas plants, which are relatively expensive investments, perform quite badly with the indicator of the investment costs per 1 MWel installed compared for example to wind turbines; however are better in terms of investment costs per 1kWh produced and the mean annual time of operation.

Following types of expenditures are allowed to be financed as qualified expenditures:

The eligible expenses for the implementation of regional investments may be also incurred by micro-, small or medium-sized enterprises to:
 * acquisition of properties undeveloped or built,
 * acquisition of fixed assets, only when they are obtained from third parties on market prices and are classified as assets of the beneficiary of the aid,
 * acquisitions of intangible and law assets related to the transfer technology through the acqui-sition of patents, licenses, know-how or unpatented technical knowledge,
 * tax on goods and services is eligible if the entrepreneur cannot deduct input tax on input VAT.


 * preparing the documentation necessary to develop a proposal for funding under the Opera-tional Programme „Infrastructure and Environment”,
 * legal advice and consultancy services amounting to 50% of incurred expenditure.

Large projects with a value of more than 25 million EUR also will be reviewed by the European Commission before the grant agreement signature.

Until now there were two calls announced under the Activity 9.4. The first call for proposals was completed on April 14, 2009. The total amount of funding was 742 million PLN (185.5 million EUR). In total 120 proposals were submitted, including 16 biogas investments. After the formal and first stage substantive evaluation 45 projects were on the primary ranking list and 9 on the reserve list. 6 biogas projects were placed on the primary ranking list and 1 project on the reserve list. After the second stage substantive evaluation only one out of the 6 biogas projects was recommended for funding. The level of funding is 60%. The project is currently realized.

The second call was completed on 31 May, 2010. The total amount of funding was 195 million PLN (48.75 million EUR). In total 160 applications were submitted for a total grant amount of 3.181 billion PLN (795.25 million EUR). After the formal and first stage substantive evaluation 20 projects are on the primary ranking list. 6 biogas projects are on the primary list, which means they will undergo second stage substantive evaluation.

No call for projects is expected to be announced in 2011.

Example 2: National Fund for Environmental Protection and Water Management

The second example is a refundable financial support in a form loans from the National Fund for Environmental Protection and Water Management (NFOŚiGW). The information is availa-ble at http://www.nfosigw.gov.pl.

NFOŚiGW announced a third contest within the Priority Programme entitled "Program for pro-jects in the renewable energy and cogeneration facilities - Part 1”. The short name of the re-cently announced contest is “III contest for RES”. The proposals were to be submitted be-tween d 6 December, 2010 and 7 January, 2010. The total allocated funds amount to 1,260 million PLN (315 million EUR) for financing projects in the form of loans.

The funding comes from fines and substitution fees played by the energy companies for not meeting the renewable energy targets. This money is converted into renewable energy in-vestments in a form of loans. The investments have to be located on the territory of Poland. Following types of projects are eligible:

There are no specific restrictions on the type of beneficiary applying for funding from the “III contest for OZE”. The only limitation is that one applicant can only submit on project proposal in contest.
 * Thermal energy production from biomass (distributed generation units of capacity not higher than 20 MW).
 * Combined electricity and generation from biomass (distributed generation units of capacity not higher than 3 MWel).
 * Electricity generation and/or heat from biogas produced in the processes or wastewater dis-posal or plant and animal decomposition.
 * Construction, expansion or reconstruction of agricultural biogas plants in order to introduce the gas into the gaseous distribution grid and direct marketing.
 * Wind turbines of capacity not higher than 10 MWel.
 * Energy capturing from geothermal waters.
 * Hydro power of a capacity not higher than 5 MWel.
 * High performance cogeneration without the use of biomass.

Funding can be awarded for projects which have no received financing from the NFOŚiGW resources in other programs. The project has to be in accordance with the rules of funding in the National Fund for Environmental Protection and Water Management and the Fund's priori-ty program entitled "Program for projects in the field of renewable energy sources and cogen-eration facilities - Part 1 ". The total cost of the project has to be no less than 10 mln PLN (2.5 million EUR).

The “III contest for RES” is divided into two stages. In the first stage the applicant submits the project proposal during the Fund's call for proposals. It has to be a paper version of the filled in application form (original), together with the documents indicated in the list of attachments for the first stage of assessment (in accordance with Annex No. 4 to the Regulations). In the second stage, on the request of the NFOŚiGW, a complete documentation should be prepared in one paper copy in A4 format with the electronic version. The complete documentation for the second stage has to be submitted within 12 months from receiving the request notice from the NFOŚiGW. This period may be extendable by a further 3 months only in justified cases.

The selection of the projects is based on the program access criteria and the criterion selec-tion. Ranking list of primary / reserve projects is prepared. The project proposals are evaluated on the 0/1 note for each criterion, which means that verification is carried out at an angle, or failure to meet the criterion.

The funding is offered in a form of interest-bearing loans. Granting the funding may be pre-ceded by a promise of a loan. The promise of a loan is granted on the basis of the application from the first stage of the competition. The loan agreement is concluded with the applicants whose applications were positively evaluated in the second stage.


 * Loan amount: from 4 million to 50 million PLN (12.5 million EUR).
 * The amount of the loan: Up to 75% of eligible project
 * Interest rate: variable interest rate.
 * Funding period: up to 15 years after the first payment.
 * Grace period: grace period for the principal value payments measured from the date of the last tranche payment of the loan, but no longer 18 months from the date of the project com-pletion.

Funding of the costs of preparing the necessary design and documentation is provided as de minimis, in accordance to the Regulation on de minimis aid. Funding of the other eligible costs of the project is granted as regional aid under conditions specified in the Regulation on regional aid. The gross grant equivalent contained in the loan (together with the cancellation if granted) may not exceed 30% of the discounted eligible costs of the project and may not exceed 20 mln (5 million EUR) per project. The funding aid intensity is calculated taking into account the total value of the public aid from all sources included in the financial engineering of the project. The total funding from public funds (excluding de minimis aid allocated for costs of preparing the necessary design and documentation) not may exceed the permissible aid intensity de-fined in the Regulation on regional aid.

Costs eligible for the de minimis are costs of preparing the necessary design and documenta-tion of the project. Costs eligible for regional aid: include following: - buildings, machinery and equipment,
 * Costs of land acquisition.
 * Acquisition costs or cost of creating new assets, including:

- tools, instruments and apparatus,

- the infrastructure related to new investment, but by building,

- technical infrastructure, which means interior technological infrastructure, connections to leading media sites, elements of the fence and greenery protecting the technological facili-ty, roads and squares of technology, etc.


 * Cost of installation and commissioning of fixed assets.
 * Costs of acquisition of construction services and materials
 * Costs of acquisition of the intangible assets in the form of: patents, licenses, technical knowledge, technology or organization and management.
 * Costs of supervision.

It is possible that part of the loan will be cancelled. The main conditions of cancellation:


 * Up to 50% of the loan amount depending on the profitability of the project.
 * Submitting the application for cancellation after the confirmation on achieving an environmen-tal effect by the project.
 * Timely achievement of physical and ecological effects.
 * Timely payment of installments of principal and interest throughout the loan period.

Specific aspects
Country characteristics In general the agricultural biogas investments are a new type of activity in Poland. However, this sector has been given a great attention recently, which resulted in many legal, organiza-tional and financial solutions facilitating development of biogas projects in Poland.

The investment cost of biogas plant are relatively high amounting to 15 million PLN for a 1 MW electricity installed, which is equal to 3.75 million EUR. If the capacity is lower the relative investment costs are even higher. This means biogas plants are very expensive investments.

The general opinion is that without a subsidy the biogas plant investment cannot give a positive financial outcome. Therefore founding in the form of grants is regarded crucial for the ag-ricultural biogas plants development in Poland. Especially the grants available under the Op-erational Programme “Infrastructure and Environment” are considered the most attractive source of financial support. The total level of subsidy can even reach 70% in case of small and medium enterprises in some selected regions.

The refundable support instruments, such as bank loans, are also important, however most of the biogas investment proposals are applying in the first place for the grants. If the proposal is not ready for a given call or has been rejected due to some reasons, in the second place the investor is applying for loans with subsidized interest rates.

It should be also mentioned that the project that is applying for the financing, regardless the programme or institution, has to be relatively much advanced in preparation. It means the feasibility study has to be prepared, the environmental decision has to be granted, the building project has to be accepted and the building permit granted, etc. In general, the better ad-vancement of the investment in terms of the administrative procedures, the better position of the project and higher chance for granting the financing. The investor has to be prepared to cover the expenses for the project preparation (feasibility study, environmental impact review, building project, etc.) from his own sources. These activities typically have to be done before applying for the financing from the banks or EU founds.

Typically the administrative procedures need several months up to 2 years to be completed, thus, there are in practice problems to gather all the necessary documentations within the re-quired time. For example, the rules of the PO “Infrastructure and Environment” Activity 9.4, which is relevant for renewable energy projects, require that the complete documentation of the investment in terms of administrative procedures has to be submitted within 12 months from the date of the call announcement. In practice in some cases this happened to be im-possible for the investor and the project was rejected.

Summary of Positive and Negative Aspects
Summary of positive aspects
 * Renewable energy projects, including biogas investments, are offered funding from several financial schemes in Poland. Non-refundable as well as refundable financial instruments are available.
 * Significant contribution to the renewable energy projects development come from Operational Programme “Infrastructure and Environment”. So far, the most important support for biogas projects has come from Activity 9.4 "Energy production from renewable sources". Two calls for proposals have been announced under this activity. The financing can reach even 70% of the total eligible investment costs.
 * More than 10 agricultural biogas investments were submitted to the first and second round of call for proposals under the Activity 9.4 "Energy production from renewable sources". In total 12 biogas projects were evaluated high amounts of points and were placed on the primary ranking lists, which makes them eligible them for second stage evaluation and finally for fund-ing is positively verified.
 * Apart from the Activity 9.4, biogas projects designed as a high efficiency cogeneration units can apply for a support from Activity 9.1. There is also a possibility to obtain financing for the industry producing equipment for the biogas plants under the Activity 10.3.
 * Loans are offered from the National Fund for Environmental Protection and Water Manage-ment. In opposite to the OP “Infrastructure and Environment” the investment can be in a rela-tively early stage of development when submitted. The procedure allows that first the project is granted a promise of a loan and then the applicant has to obtain and submit all other required documentation on the investment, which has to happen within 15 months at the latest from the request of the Found. BOŚ Bank offers loans with preferential interest rates subsidized by the National Fund for En-vironmental Protection and Water Management.
 * BOŚ Bank offers free-of-charge assistance of specialists (ecologists employed by the bank) in drawing up the proposal of ecology-oriented projects. Commercial loans are available from other commercial banks.

Summary of negative aspects
 * Under the Activity 9.4 all types of renewable energy projects compete together for the availa-ble founding. This means that biogas projects are put together with wind projects and others. Under these conditions biogas plants, which are relatively expensive investments, perform quite badly with the indicator of the investment costs per 1 MWel installed compared for ex-ample to wind turbines.
 * The administrative procedures, such as granting environmental decision and granting the building permit, typically last several months. In some cases it may be a limiting factor for to submit the necessary documentation to the funding institution in the required time, which typi-cally is 12 months from the call announcement day.
 * The projects submitted to the OP “Infrastructure and Environment” are granted additional points if they are relatively advanced in terms of preparation. Project having the environmental decision, building permit, connection to the grid have better chances to be placed to the primary list of project, which are allowed for second stage evaluation. However, obtaining all the administrative procedures is a considerable pre-investment cost related to the preparation of construction design, environmental impact review, etc.
 * Only a few Regional Operational Programmes offer financial support for renewable energy projects.
 * The initial schedule of the call for proposal under the OP “Infrastructure and Environment” for Activity 9.4 was not respected. The calls were postponed even with several months. There were changes in the rules and application forms of the calls.
 * Biogas projects are expensive investments, which under Polish conditions need to be financed with a non-refundable financial support. A commercial load itself is not enough to guarantee a positive financial return from the investment.

Further topics
Some recommendations for the improvement of the financial schemes for biogas projects in Poland:
 * It is crucial to keep the schedules of the calls and contest under different financial support schemes and avoid delays. On the other hand, the information about planned calls has to be published few months in advance. Preparation of the investment for founding requires con-siderable time, especially in terms of obtaining all relevant administrative decisions.
 * There are difficulties with the financial engineering of projects submitted to the financial schemes. There are great uncertainties concerning the available support system in the form of green and other certificates. According to the state of art the green certificates system is guaranteed till 2019 and the yellow ones till 2012 while the investment lifespan is typically 20 years or longer. There is a need for defining clear and long-term policy regarding financial support for biogas sector.
 * There is a great need for supporting promotion activities for the development of biogas plants, including good practice examples and demonstrative projects. Biogas plants are still a very new type of activity in Poland and often raise local conflicts, which can hinder the investment in each stage of development.

Training and education
The higher education system is well developed in Poland; the number of students were 1.9 million in school year 2009/2010 (/1/ CSO Statistical Yearbook 2009), which constituted almost 5% of the Polish population. This system is based on state and non-public (private)higher education institutions. This system is supported by the existing in Poland and a pretty large training market, which allows supplementing expertise at various levels.

In Poland the system of higher education includes state (public) institutions and non state ones established since 1990. There have been also founded state and non-state higher vocational education institutions since 1998. A person who obtained a high school diploma may be admitted to such school. Studies may be carried out as day, evening, weekend and extramural courses and in an e-learning system. There are also offered interdisciplinary and inter-institutional studies. Moreover, having obtained a master's, bachelor's or engineer's degree, one can take a postgraduate course. Pursuant to the provisions of the Bologna Declaration, the institutions of higher education introduce II-and III-stage studies, the system of comparable degrees and the ECTS grading system (European Credit Transfer System) .

Education with (partial) focus on biogas
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