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Economic assessment of flexible power generation from biogas plants in Germany's future electricity system

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  • Lauer, Markus
  • Leprich, Uwe
  • Thrän, Daniela

Abstract

When integrating intermittent renewable energies in the electricity system, additional technologies are needed to ensure that a sufficient power supply is maintained. Alongside storage technologies and conventional power plants, dispatchable biogas plants are one solution for balancing demand and supply in energy systems with a high proportion of renewable energies. In this study, we conducted an economic assessment of the different extension paths and modes of operation of the biogas plants in Germany's future electricity system for the period of 2016–2035. This entailed carrying out a cost-benefit analysis that included the costs incurred for the flexibilization and installation of new biogas plants and the costs saved with respect to onshore wind turbines and additional saved opportunity costs. The results show that adding biogas plants in Germany's future electricity system –compared to their phase-out– requires cost reductions and/or has to be accompanied by further benefits in other sectors and areas to ensure economically feasible operation. Differentiated from a substantial growth, higher net present values were obtained in the extension path characterized by a low construction rate of new biogas plants. Furthermore, the economic feasibility of biogas plants benefits from an early phase-out of lignite- and coal-fired power plants.

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  • Lauer, Markus & Leprich, Uwe & Thrän, Daniela, 2020. "Economic assessment of flexible power generation from biogas plants in Germany's future electricity system," Renewable Energy, Elsevier, vol. 146(C), pages 1471-1485.
    • Handle: RePEc:eee:renene:v:146:y:2020:i:c:p:1471-1485
    DOI: 10.1016/j.renene.2019.06.163
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    3. Balibrea-Iniesta, José & Rodríguez-Monroy, Carlos & Núñez-Guerrero, Yilsy María, 2021. "Economic analysis of the German regulation for electrical generation projects from biogas applying the theory of real options," Energy, Elsevier, vol. 231(C).
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    10. Cudjoe, Dan & Nketiah, Emmanuel & Obuobi, Bright & Adu-Gyamfi, Gibbson & Adjei, Mavis & Zhu, Bangzhu, 2021. "Forecasting the potential and economic feasibility of power generation using biogas from food waste in Ghana: Evidence from Accra and Kumasi," Energy, Elsevier, vol. 226(C).
    11. Saija Rasi & Karetta Timonen & Katri Joensuu & Kristiina Regina & Perttu Virkajärvi & Hannele Heusala & Elina Tampio & Sari Luostarinen, 2020. "Sustainability of Vehicle Fuel Biomethane Produced from Grass Silage in Finland," Sustainability, MDPI, vol. 12(10), pages 1-11, May.
    12. Briest, Gordon & Lauven, Lars-Peter & Kupfer, Stefan & Lukas, Elmar, 2022. "Leaving well-worn paths: Reversal of the investment-uncertainty relationship and flexible biogas plant operation," European Journal of Operational Research, Elsevier, vol. 300(3), pages 1162-1176.
    13. Dotzauer, Martin & Oehmichen, Katja & Thrän, Daniela & Weber, Christoph, 2022. "Empirical greenhouse gas assessment for flexible bioenergy in interaction with the German power sector," Renewable Energy, Elsevier, vol. 181(C), pages 1100-1109.

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