Construction of Biogas Plants in Serbia

DEVELOPMENT CONDITIONS ACCORDING TO THE ENERGY DEVELOPMENT STRATEGY OF SERBIA BY THE YEAR 2030

The strategic direction of energy development in the Republic of Serbia is primarily determined by internationally assumed commitments. The Treaty Establishing the Energy Community is the first treaty between the Republic of Serbia and the European Union, whereby the Republic of Serbia has undertaken the commitment to implement EU regulations. Membership in the Energy Community (treaty entered into force in 2006) and the process of accession to the European Union are of vast significance. The importance of the Treaty Establishing the Energy Community was confirmed by the ratification of the Stabilization and Association Agreement in 2008.
The key priorities of the adopted strategy (until 2030) are the establishment of energy security, energy market development and an overall transition to sustainable energy.

RAW MATERIAL CONDITIONS AND POTENTIAL

According to verified reserves of oil and natural gas – unless significant discoveries are made, it can be expected that, by 2030, the exploitation of these energy resources in the country will have become low or entirely exhausted.
At present, the most significant domestic energy resource is coal – the reserves of which should, according to the projected level of consumption, remain sufficient for exploitation even after 2050.

LEGISLATION

The laws and bylaws that govern the majority of RES related activities are:
– Energy Law (Official Gazette of the Republic of Serbia, No. 145/2014)
– Law on Efficient Use of Energy (Official Gazette of the Republic of Serbia, No. 25/2013)
– Decree on Incentive Measures for the Production of Electricity from Renewable Energy Sources and Highly Efficient Cogeneration of Electricity and Heat (Official Gazette of the Republic of Serbia, No. 56/2016).
– Decree on the Conditions and Procedure for Acquiring the Status of Privileged Electricity Producer, Temporary Privileged Electricity Producer and Producer from RES (Official Gazette of the Republic of Serbia, No. 56/2016)

TECHNICAL AND ECONOMIC CONDITIONS

The potential annual production of biogas is estimated from the data on the annually available quantity of substrates. For this purpose, indicative literature data on biogas yields are used. Potential biogas yields are mainly expressed using the amount of fresh substrate mass. The potential yield of biogas varies depending on the moisture content of the substrate and also depends on the share of organic dry mass. The share of dry and organic dry mass in the substrate is determined for a more accurate measurement of annual biogas production.

CURRENT STATE OF DEVELOPMENT IN SERBIA

The rapid increase in the world population and growth of the global economy have resulted in increasing energy consumption. It is estimated that total global energy consumption will have grown by 58% by the year 2040 as compared to 2010. The use of conventional technologies for the production of energy from fossil fuels has led to fossil fuel depletion, increased environmental pollution as well as increased greenhouse gas emissions causing climate changes. Greenhouse gas emissions increased by 70% between 1970 and 2004, thus necessitating the introduction of new energy sources that would lead to a secure energy supply, reduce environmental pollution and mitigate climate changes. One way of producing renewable energy and possibly replacing fossil sources is the application of anaerobic digestion and biogas production. The application of biogas has recorded a significant increase during the second half of the twentieth century, especially in developing countries. In addition to energy production, this also serves as a solution for sanitary problems through wastewater treatment.

SWOT ANALYSIS

By definition, SWOT analysis represents a suitable manner of observing the prospects or obstacles for project implementation in the form of a comparative overview of the main strengths, weaknesses, opportunities and threats. The Energy Development Strategy of the Republic of Serbia enables the identification of key positive and negative factors that could affect the achievement of objectives, an overview of items that may serve for stimulating the implementation of the Strategy, as well as what might lead to delays and issues, either due to internal weaknesses or external constraints.

FINANCING

Sources of financing for the construction of biogas plants play a significant role and thus strongly affect the financial assessment. In most countries of the European Union and beyond, such projects are encouraged via the award of grants, for all or part of the investment, or via granting particularly favorable loans. The reason for the above is quite simple, given that encouraging such projects contributes to the realization of national goals in terms of energy efficiency, use of national human and material resources and reduction of dependence on imports of energy generating products. This also applies in Serbia. There are numerous options available, albeit with many limitations. Below is a description of the major sources of financing, with particularly favorable conditions for the production and use of renewable energy sources, including biogas. Each option should be properly considered, and all the costs incurred during the provision of funds should be taken into account, as the seemingly lowest may eventually turn out as significant.

CONCLUSION

Pursuant to the analyses presented in the material, it may be concluded that, according to the current conditions of the Decree on the Conditions and feed-in tariffs, as well as raw material prices, INVESTING IN BIOGAS PLANTS IN SERBIA IS PROFITABLE.
Investments may be organized as standalone with the purchase or lease of the land required (400 ha for 1 MW) and self-organization of the entire operation – production, commissioning and maintenance for biogas plant development.
Another form of construction is possible through joint ventures with farmers, where the farmers would provide the land required for plant construction, secure the operation of the plant and uptake the post-fermentation mass and heat. The partner investor would provide the financing, documentation necessary for the commissioning of the plant and contract with the Electric Power Industry of Serbia (electricity supply).

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