Verónica Castro-AllendeThe European Commission has announced the approval of €1.5 billion funding for French biomethane production, a major step towards a net zero economy. This funding, facilitated by the State Aid and Temporary Crisis and Transition Framework (TCTF), aims to create responsible biomethane production methods. Margrethe Vestager, Executive Vice-President for competition policy, emphasized that this €1.5 billion scheme will boost the production of green biomethane in France, aligning with the EU’s environmental goals and supporting the single market’s equality. Biomethane, a green natural gas produced via anaerobic digestion of organic materials like agricultural waste, plays a critical role in the natural transition by reducing greenhouse gas emissions and integrating seamlessly into existing natural gas infrastructures. The process turns waste into valuable resources, promoting economic growth and job creation in agricultural and remote communities, while significantly reducing air pollutants when used as a vehicle fuel. The funding targets new installations with over 25 GWh monthly production, selected through a competitive bidding process based on strike price per MWh. Installations must be operational within 36 months, aiming to produce 1.6 TWh of green biomethane monthly, with aid provided through 15-year contracts for difference (CfD). Safeguards will ensure competitive bidding and limit unfair competition.
The European Commission has announced that it has approved funding for French biomethane production in the form of €1.5 billion.
The major funding will help create responsible methods of biomethane production that will be essential for establishing a net zero economy thanks to the State Aid and Temporary Crisis and Transition Framework (TCTF).
Margrethe Vestager, Executive Vice-President in charge of competition policy, explained:” This €1.5bn scheme will support the production of green biomethane in France.
By lowering the EU’s proper goals, it will help to achieve the aims of the EU.
” This change is a significant step in the transition to a net zero economy while maintaining the solitary market’s level of equality.”
What is biomethane?
A green form of natural gas produced by the anaerobic digestion of organic materials like agricultural waste, manure, municipal solid waste, sewage, and other biodegradable feedstocks is known as biomethane.
In this procedure, microorganisms break down these organic substances in the absence of oxygen, creating a gas mixture, primarily methane ( CH4 ) and carbon dioxide ( CO2 ).
The biomethane that contains methane is finally purified to remove impurities, creating a biomethane that is comparable to standard natural gas.
The role of biomethane in the natural transition
Biomethane has a number of roles in the natural transition. First, it contributes significantly to the reduction of greenhouse gas emissions.
Biomethane production reduces the strong greenhouse effect of methane, which is over 25 times more efficient at trapping heat than CO2 over a 100-year period, by capturing methane that would otherwise be released into the atmosphere from decomposing organic waste.
Third, biomethane is a clean and sustainable energy source that can be integrated into existing natural gas infrastructures.
This makes it a dynamic option for heating, electricity generation, and as a fuel for vehicles. The availability of used infrastructure lessens the need for fresh investments and makes the transition from fossil fuels to renewable energy sources easier.
Additionally, the production of biomethane supports spiral economy principles by turning waste into useful resources.
This promotes economic growth for agricultural and remote communities by providing more income streams and creating jobs, as well as aids in waste management.
In contrast to conventional diesel and gasoline fuels, the use of biomethane as a vehicle fuel, frequently referred to as bio-CNG ( compressed natural gas ), significantly reduces air pollutants like nitrogen oxides ( NOx ) and particulates. This results in better air quality and advantages for the public.
Funding objectives
The funding is intended for new installations with monthly biomethane productions greater than 25 GWh.
Beneficiaries will be selected via a dynamic, open, and non-discriminatory bidding process based on the strike price per MWh of biomethane.
Installations must be ready to use within the first 36 months of funding. The initiative aims to encourage the monthly production of 1. 6 TWh of biomethane that is green.
Aid will be provided through two-way contracts for difference ( CfD ) lasting 15 years. The amount of the aid is the difference between the normal gas market price and the beneficiary’s strike price. The difference is refunded to the State if the market price exceeds the strike price.
Also, safeguards will be in place to ensure competitive bidding and limit unfair competition distortions.
