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How can you get funding for your anaerobic digestion project in North America and assess the value of biogas?
Research of funding for your anaerobic digestion project in North America is an important step of your biogas project development. Biogas or biomethane projects require substantial initial investment. Fortunately, the governments of Canada and the United States recognize the role of renewable energy and biogas in meeting their greenhouse gas reduction targets. They support these sectors through several programs, grants, tax credits, and credit trading and purchasing systems. The North American biogas market is becoming more dynamic and profitable and biogas value is increasing thanks to these actions. It even attracts European companies wanting to install their projects there.
How to finance your anaerobic digestion project in North America?
Canada
The Canadian government and those of several provinces can help you get your anaerobic digestion project funded. Currently, the provinces of Quebec, Ontario and British Columbia have the highest concentrations of biomethanation projects in Canada, with 85 plants, and the largest number of related policies or programs.
Federal government level
Low Carbon Economy Challenge, part of the Fund, will provide more than $ 500 million for projects aiming to reduce GHG emissions and promote clean growth. It has 2 parts. The Champions Component is accepting applications until May 14, 2018, while the Partnerships Component will open for applications later in 2018.
Clean Energy for Rural and Remote Communities aims to help these communities reduce their use of diesel as a source of heat and power. Its different components touch on biothermy, renewable energies, energy efficiency and bioenergy, among others. The submission deadline is May 17, 2018. Check if your project qualifies for this program.
Businesses and organizations also have an accelerated capital cost allowance on certain types of eligible equipment. This credit aims to make renewable energy projects, including biogas, more attractive. The deduction rate obtained can go up to 50%, depending on the case. Consult the technical guide for more information on the requirements.
Agricultural Clean Technologies Program supports research, development and adoption of renewable energy technologies in the agri-food sector. It aims to reduce the GHG emissions of the industry and promote its sustainable growth. The program ends on March 31, 2021.
I invite you to consult the list of all funds, incentives and grants offered by the Canadian government in the renewable energies sector.
Provincial governments level
Each province has put in place its own measures for funding anaerobic digestion projects. In addition to the following examples, you can consult the website of the province in which you wish to establish your project and the federal government’s list of energy efficiency financial incentives by province.
Some examples :
- Ontario — The GreenON Challenge
GreenON Challenge will provide more than $ 300 million beginning in 2018 to businesses and organizations. This amount is intended to help them commercialize low-carbon technologies already available on the market and optimize buildings or the production of goods.
- British Columbia — Innovation Clean Energy Fund (ICE)
Innovative Clean Energy (ICE) Fund supports, among others, businesses, municipalities, First Nations and universities in the development of low-carbon technologies. Since 2008, the program has invested approximately $ 97 million in biomethanation, solar energy and energy management projects, for example.
PTMOBC supports municipalities and businesses in the installation of infrastructures for biomethanation and composting of organic materials. It aims to reduce the amount of organic matter eliminated in Quebec and the GHG emitted during this process. The program is extended until 2022.
You can also check if the SR&ED Investment Tax Credit Policy may apply to your project in a given province.
United States
To get funding for your biogas project in United States, you can also benefit from several interesting programs, financial incentives, tax credits and subsidies. The laws governing this type of project and the programs may vary from state to state.
For example, the Renewable Portfolio Standards (RPS) requires electricity providers to add a certain amount of electricity from renewable sources to their grid. This quantity, the requirements and the funding allocated may however vary from one State to another. I therefore invite you, for more information, to consult the website of the State where you wish to establish your project.
Some examples of biomethanation and renewable energy programs:
This law was introduced in Congress last fall, but may soon be passed. It aims to expand the tax credit for production of electricity with renewable energy sources to biogas and anaerobic digestion. Since 2016, this credit only involved electricity generated from solar and wind energy.
AgSTAR program helps farmers to acquire anaerobic digestion infrastructure, such as digesters. They can reduce their methane emissions and enjoy the associated environmental, social and economic benefits.
Rural Energy for America Program Renewable Energy System and Energy Efficiency Improvement is for farmers and small businesses in some rural areas. It allows them to install systems that use renewable energy, such as biogas or renewable natural gas, or to improve the energy efficiency of their processes. The deadline for submissions is April 30, 2018.
EQIP helps farmers deal with the challenges specific to their activities while protecting the environment. The program provides financial assistance to implement good environmental practices relating to energy, air quality or organic materials, among others.
You can consult a more complete list of energy sector programs as well as the list of current bids for grants from the US Department of Energy.
What’s the value of biogas on the market?
Verifying the value of biogas on the market is one of the elements to assess profitability and direct your research to get funding for your anareobic digestion project in North America.
Many factors can influence the biogas market, for example:
- The basic price of biogas
- The cost of certain types of equipment
- The cost of distribution, which depends, among other things, on the distance between the point of production and the consumer
For now, however, the main potential accelerators for biogas market are government programs and policies on renewable energy and the ban of organic materials from landfills.
We can mention, among others:
- Renewable Fuel Standards in North America
- Minimum renewable energy standards for companies to use
- The established market mechanisms
US programs for the exchange and purchase of renewable energy credits also influence the value of biogas on the market:
- The Renewable Fuel Standard (RFS) aims to encourage the use of low-carbon energy sources to replace gasoline in transportation. Companies must use a certain minimum amount of energy from renewable sources such as biomass or advanced bioenergy. To meet this requirement, companies can also earn credits called Renewable Identification Numbers (RINs) to offset a lower renewable energy requirement than required.
- The Low Carbon Fuel Standard (LCFS) aims to stimulate the production and use of fuels from renewable energy sources to reduce GHGs. The program’s standards are based on the intensity of GHGs emitted by a fuel, called Carbon Intensity (CI). This is evaluated according to the complete life cycle of the energy used as fuel and takes the form of credits. The value of a type of biogas depends on its IC.
Although these programs are based in California, many Canadian renewable natural gas facilities benefit from them.
Here are some examples of how these programs boost the value of biogas on the market:
The biogas market is therefore particularly dynamic and conducive to new anareobic digestion projects. Governments in North America would therefore benefit from introducing new policies and programs to further stimulate this market. In fact, in the coming months, they want to implement measures to help the industrial and agricultural sectors to develop further because they are slowing down.
BiogasWorld: a partner that helps you concretizes your project!
The search to get funding for your anaerobic digestion projects and the study of its profitability according to the value of the biogas market are complex steps. Having local partners and establishing good business relationships with biogas companies in North America can be effective solutions to deal with them.
To get a preliminary assessment of your project, we invite you to use our free biogas calculator, ideal for planning your project. In addition, do not hesitate to contact us if you need help to carry out your anaerobic digestion project. We have an extensive network of customers and industry experts who can meet your needs!