- Cadent commissioned EY report on Options for ‘Stimulating investment in BioSNG’ published today (May 9)
- The report examines what market framework, mechanisms and incentives would be needed to roll out BioSNG(bio-substitute natural gas) plants across the country
- Cadent has backed a successful trial BioSNG plant in Swindon and is now funding a commercial plant at the site due to go operational later this year
A new report published today aims to kick-start an exploration of what foundations need to be in place to facilitate a green gas revolution in Britain.
Cadent has already been blazing a trail in exploring new green energy frontiers, by helping fund the world’s first commercially operating BioSNG (bio-substitute natural gas) plant, which converts household waste into gas, in Swindon. It backed a successful trial plant at the site and has subsequently provided £8.6m of funding for the commercial plant, which is due to start production later this year.
The new report ‘Stimulating investment in BioSNG’ which Cadent commissioned EY to carry out takes the next logical step and explores what market frameworks, mechanisms and incentives would be needed to roll out a network of similar BioSNG plants across the country.
Stuart Easterbrook, Cadent’s Future Gas Strategy Manager, said: “Cadent is very excited to be one of the pioneers at the forefront of this great green gas revolution of the 21st
“In the future we could see a whole network of plants similar to the one we’re helping develop in Swindon springing up across the country.
“These would provide low carbon, sustainable and affordable energy that could be used with existing gas boilers and cookers or to fuel gas powered lorries and buses, while also reducing landfill waste and diesel emissions.”
He added: “What we’re doing with this report is to focus on the bigger picture to ensure that everyone starts to think about the things that will need to be in place to facilitate this.”
Cadent Chief Executive Chris Train said: “Cadent is passionate about decarbonising energy and finding innovative solutions to the future of gas.
“We’re expecting the BioSNG technology we’re helping develop to be game changing and we need to ensure the right support mechanisms are in place so we can hit the ground running and roll it out quickly and effectively.”
He added: “With this report we want to advance commercial and regulatory thinking and examine what frameworks could support BioSNG.
“We don’t yet have all the answers to this great challenge and we hope this report will help shape the debate as we explore the future with policymakers.”
Anthony Legg, Head of Power & Utilities, Economic Advisory, EY, said: "There are a range of different ways that the government and Ofgem might be able to support investors into BioSNG projects.
“These options range from grants and guarantees of loans, through to various kinds of feed in tariffs or contracts for difference, or enabling gas distribution networks to invest in BioSNG plants as part of their regulated activities.
He added: “Recognising that all of the available options have strengths and weaknesses and that further more detailed stakeholder engagement and quantitative analysis is needed; our report does not attempt to land on a single best option for policy makers to take forward.
“The report does, however, try and identify a short list of approaches which strike a good balance between de-risking projects to bring forward investments in the short term and exposing projects to the right amount of market forces to drive innovation and cost reductions over the medium and longer term."
The new commercial £27m BioSNG plant in Swindon is being built by a consortium of partners made up of Advanced Plasma Power, Progressive Energy, Wales & West Utilities, CNG Services and Cadent. Backing of £11m for the plant was also awarded from Department for Transport’s Advanced Biofuels Demonstration Competition in September 2015 and over £5m is being contributed from the Network Innovation Competition, run by energy regulator Ofgem.