Agricultural Summit: What agricultural producers think about today when they talk about biogas and biomethane

Despite the war, the Ukrainian agricultural sector continues to invest in development, seek new opportunities, and adapt to change. That is why industry events today are becoming not only a forum for sharing experiences, but also a platform for shaping future decisions.

This year, the Pro-Energy team took part in the International Agricultural Week at the invitation of the Ukrainian Bioenergy Association. For us, it was an opportunity to talk to agricultural producers, hear about current market demands, and share our practical experience of implementing projects in the field of biogas and biomethane.

Participation in the event confirmed the main point: the agricultural sector continues to seek ways to improve energy efficiency and reduce its dependence on external energy resources.

Why Pro-Energy took part in the event

The event brought together precisely the audience for whom biogas and biomethane projects may be of the greatest relevance — agricultural enterprises of various sizes.

Secondly, the International Agricultural Week traditionally focuses not only on technology but also on practical issues relating to the development of agribusiness. A significant proportion of the discussions centred on finding effective solutions for the sector, cooperation between the state and the private sector, and the development of a shared vision for the future of Ukraine’s agricultural sector.

For Pro-Energy, this was an opportunity to see how today’s proactive agricultural community thinks and what challenges businesses face in wartime.

Pro-Energy at the International Agricultural Week

Pro-Energy was represented at the event by Malvina Shynkarchuk, biogas project manager, an expert in biogas and biomethane technologies and a PhD in biotechnology and bioengineering.

During the expert discussion, she shared her team’s practical experience in implementing biogas and biomethane projects for the agricultural sector. Among the topics that aroused the greatest interest among participants were the prospects for the biomethane market, the sale of electricity generated from biogas, and the economic viability of small-scale biogas plants for agricultural enterprises.

Bioenergy is moving from discussion to implementation

One of the key takeaways from the event was that bioenergy is gradually moving from the realm of promising ideas into that of practical business solutions.

Many companies which, just a year or two ago, were merely exploring the possibilities of implementing biogas projects are now preparing to roll them out or are at various stages of finalising their investment decisions.

At the same time, the market continues to gain experience, and with it, the typical mistakes that can be avoided as early as the planning stage.

That is precisely why, during their presentations and discussions, the Pro-Energy team focused not on individual pieces of equipment, but on the right approach to choosing a concept for a future project.

Which solutions attracted the most interest

During the event, we shared our own experiences regarding which biogas project models currently offer the best economic returns for agricultural enterprises.

The main emphasis was placed on choosing the right concept even before the design phase began.

After all, it is at this stage that the future effectiveness of the project is established:

• the actual raw material base is analysed;
• the optimum capacities are determined;
• the markets for the products are assessed;
• the project’s economics are calculated;
• potential sources of funding are identified.

Over the years, the Pro-Energy team has come to realise that the success of a biogas or biomethane plant depends to a large extent not on the choice of specific equipment, but on the quality of the preparatory phase.

What are the issues currently causing the most concern in the market?

Virtually all the participants’ questions, in one way or another, centred on three key topics.

The market for the sale of electricity generated from biogas

Following changes to the terms of the “green” tariff, businesses now operate under market-based mechanisms for selling electricity; however, these two mechanisms are still on a par in terms of economic viability.

Companies are keen to understand how stable their income from electricity generation will be in the future.

The outlook for the biomethane market

The development of the biomethane sector was discussed just as actively.

Interest in biomethane continues to grow thanks to the possibility of exporting it to European Union countries and the high demand for renewable gases.

That is precisely why many agricultural enterprises are currently trying to work out which direction offers better prospects: electricity generation or biomethane production.

The use of CO₂ as a by-product

Another topic discussed was the potential for the recycling and commercial use of carbon dioxide produced during biomethane production.

Businesses are increasingly taking a holistic view of projects and seeking ways to maximise the value of each product stream.

Is it profitable to build small biogas plants?

One of the most interesting questions raised during the discussions concerned small-scale biogas projects.

Many medium-sized and small agricultural enterprises are sufficiently motivated to adopt biogas technologies, but face the complex economics of such projects.

That is precisely why the participants were interested in:

• what power rating you should start with;
• which types of raw materials offer the best return on investment;
• when it is more appropriate to consider biomethane, and when — cogeneration;
• how to properly assess a company’s potential before launching a project.

According to Pro-Energy’s experts, there is no one-size-fits-all answer. Each project requires a case-by-case analysis of its raw material base, logistics, energy consumption, and market opportunities.

That is precisely why the first step should always be a thorough technical and economic feasibility study.

A mistake that is becoming increasingly common

During the event, we paid particular attention to the issue of the quality of input data for design work.

Recently, Pro-Energy has been approached with increasing frequency by companies that already have concepts drawn up by other market players and wish to obtain an alternative assessment.

The problem is that some of these concepts are based on unrealistic raw material figures or inflated production parameters that have not been properly verified.

As a result, an investor may end up with a model that looks attractive on paper but is not borne out by actual operating conditions.

That is precisely why a thorough analysis of the raw material base and an independent verification of the source data remain critically important for the successful implementation of any bioenergy project.

Which energy solutions offer the greatest potential

Based on the outcome of the discussions, two areas can be identified that currently offer the greatest potential for the agricultural sector.

The first is on-site cogeneration.

In the face of an unstable energy supply and high electricity prices, on-site generation enables businesses to control their costs and increase their energy independence.

The second is the production of biomethane from high-quality feedstock for subsequent sale.

It is precisely this sector that many market participants regard as one of the most promising for the long-term development of agribusiness.

Is funding available for such projects?

There are opportunities to secure funding today.

At the same time, investors and financial institutions are taking an increasingly close look at the economic viability of projects.

To receive funding, you must demonstrate:

• a realistic raw materials base;
• a clear business model;
• projected payback period;
• professionally prepared project documentation.

Projects with a strong economic case and sufficient scale currently stand the best chance of securing funding.

For small and medium-sized enterprises, this process remains more complex, but opportunities do exist provided the project is well prepared.

The main conclusion following the International Agricultural Week

Participation in the event confirmed that, despite the challenges posed by the war, the Ukrainian agricultural sector continues to invest in development and to seek ways of improving energy efficiency.

Three key conclusions emerged for the Pro-Energy team.

1. Biogas and biomethane have moved from the “interesting” stage to the “let’s look at the economics” stage.

Whereas previously most companies were merely familiarising themselves with the technologies, today agricultural producers are already evaluating specific business models, calculating payback periods, and preparing to implement projects.

2. The greatest risk to the project is errors at the concept stage.

During the presentation, our team focused extensively on issues relating to the raw material base, capacity selection, and the forecasting of economic indicators. Experience shows that it is precisely inaccurate input data that most often leads to over-optimistic expectations and problems during the implementation of bioenergy projects.

3. The most promising areas for agricultural enterprises today remain cogeneration for their own needs and the production of biomethane from high-quality feedstock.

It is precisely these solutions that make it possible to combine the company’s energy independence with the opportunity to derive additional economic benefits from its own energy resources.

International Agriculture Week has once again confirmed that the energy component is gradually becoming part of the long-term development strategy for agricultural enterprises, and that the issues of biogas and biomethane are moving from the realm of theoretical discussion to that of practical investment decisions.

Do you need advice on biogas or biomethane?

The Pro-Energy team helps to implement projects in the fields of biogas, biomethane, cogeneration, and energy efficiency — from the initial analysis of the feedstock base through to the commissioning of the facility.

If you are considering building a biogas or biomethane plant, please contact us for advice. We can help you assess the project’s potential and choose a model that will work specifically for your business.