Investments in LFGE Projects Gather Pace on Back of their Cost Competitiveness
Landfill gas is released by the decomposition of organic waste in municipal solid waste (MSW) landfills. The landfill gas to energy projects utilise the methane generated through waste composition by driving pipes deep within the core of landfills, and funnelling the gas to generators for burning. Depending on the composition of the landfill, the gas generated is typically around 50/50 methane and carbon dioxide. Landfill projects are initiated prior to the closure of the landfills and consist of vertical wells to collect gas and send it through a scrubber, a compressor, and finally to a generator for combustion. Over the recent past, landfill gas to energy (LFGE) facilities have been receiving high levels of investment, proving to be a cost-effective way to utilise landfill gas for generating energy, as well as achieving significant reductions in greenhouse gas (GHG) emissions.
Favourable Regulatory Framework and Government Policies Boost Investments into LFGE
The issues of energy security continue to aggravate, the cost of electricity continues to soar, and the climate change becomes highly impactful. Governments have been aspiring to utilise the landfill gas to ultimately reduce GHG emissions in an attempt to meet Paris Agreement obligations. This remains the key factor driving the growth of the global landfill gas to energy market. Typically, LFG comprises around 49% methane, 49% CO2, and a small percentage of non-methane organic compounds. MSW landfills are responsible for around 18.2% of human-related methane emissions, making it the third-largest source of this type of emissions. Capturing, and using LFG represents a double saving in terms of reducing emissions as it prevents methane reaching the atmosphere, as well as diverting other fossil fuel burning by producing its own energy.
Financial incentives, and the subsidy mechanisms in different nations play a key role in the global LFGE market. These incentives include GHG sales revenue, feed-in tariffs, tax relief systems, and mandatory purchasing contracts of LFG generated energy from utility companies, as well as carbon credits/pricing. Developed regions such as North America, and Europe tend to have strict environmental regulation coupled with decreasing levels of financial incentive, as the industry matures. In developing regions, on the other hand, the decisions that landfill operators take to capture, and utilise LFG are financially motivated to a greater extent, with many central governments lacking the resources to enforce strict environmental regulation.
Zero Waste Initiatives Challenge Emergence of LFGE
One of the major threats to the LFGE industry is the rise in popularity of zero waste programmes that seek minimum waste ending up to landfills, thereby diverting the waste streams either to recycling facilities, or organic digester plants. Without a significant organic waste proportion in landfills, LFG generation is not possible and is likely to be markedly diminished as the characteristics of the waste inputs change.
LFGE Electricity Generation Projects Dominate, with a Promise of Energy Security in Long Term
Electricity generating LFGE projects will remain dominant compared to direct use LFGE projects, and renewable natural gas (RNG). In 2020, more than 80% of LFGE operational projects were based on electricity generation. While this is for several reasons, LFGE-based electricity has a wider range of uses than the outputs from direct use facilities i.e., heat, and certain gases. Second, several developed countries have feed-in-tariffs, and other programmes to subsidise electricity generation, making the electricity generating facilities more attractive, commercially, for landfill operators. Finally, electricity generating LFG facilities help to increase national energy security in a period of increasing energy prices, and geopolitical uncertainty.
A Number of Planned LFGE Projects Afoot in North America
North America, and Europe, specifically the UK, have the largest and most developed LFGE markets. In these regions, LFGE extraction technology is both mature, and widely available. The North American market is one of the most developed, led by the US – the global leader in the market, and Canada, has comprehensive waste management programmes in place that will see a greater proportion of MSW being diverted away from landfills to supply recycling facilities, and organic digesters. In January 2021, Ameresco completed its LFG-to-renewable natural gas (RNG) project in Texas, the US. Earlier in August 2020, Baltimore County in the US announced its entry into a new agreement with Energy Power Partners, a clean power-focused firm to participate in a landfill gas-to-energy system at the County’s Eastern Sanitary Landfill in White Marsh.
On the other hand, the rising demand for energy in Asia Pacific is expected to benefit the demand for LFGE. Courtiers housed in Southeast Asia such as Malaysia, Indonesia, and Thailand are the key contributors to FLNG growth. In Latin America, and the Middle East & Africa, investments in LFGE facilities are building up at a stable pace. In September 2020, Istanbul completed the first phase of the world’s biggest landfill gas power plant. Out of the planned full capacity of 90 MW, the first 20 MW came online in Istanbul Energy’s landfill gas power plant.
Facility Expansion Trends Competition in Global Landfill Gas to Energy Market
Some of the key players in the global landfill gas to energy market include Veolia, Viridor, Biffa, Ameresco, Aria Energy, Comcor Environmental Limited, Walker Industries, Waste Connections, Inc., Caglia Environmental, Republic Services, Inc., Waste Management, Inc., GFL Environmental USA Inc., CDT Landfill Corporation, and BKK Corporation. In December 2020, Aria Energy announced the expansion of its County Line Landfill’s LFGE project. The facility that has commenced for operation since 2014 has now been expanded to 7.6 megawatts, up from 6 megawatts.