Implementation of RED III must not jeopardise the important energy policy role of the German biogas sector
On 12 September 2023, the EU Parliament adopted a revision of the Renewable Energy Directive (RED III). The revision will further expand the bureaucratic sustainability requirements for existing plants. Their practical implementation has a direct impact on the continued existence of the German biogas sector.
According to the revised RED III, biogas plants with a rated thermal input of 2 MW or more that went into operation before 1 January 2021 must prove that they have achieved a greenhouse gas reduction of 80 percent. While the proof of a minimum greenhouse gas reduction for new plants has already been in place since 2021, the sustainability certification of existing plants that have been in operation for 15 years from 2026 will now be extended to include this requirement.
Consequently, this affects larger biogas plants that were connected to the grid by 2011. If biogas plants do not meet the requirements of RED III after transposition into national law, they would lose their entitlement to remuneration under the Renewable Energy Sources Act (EEG). In this context, Dr. Stefan Rauh, Managing Director of the German Biogas Association, points out that we have in Germany a special situation within the European biogas sector: "If you take a closer look at the construction of German biogas plants over the years, you will see that the vast majority of plants were connected to the grid by 2012. The politically subsidised flexible plants, which primarily provide energy in the form of electricity and heat when it is needed, are particularly affected. To prevent a drastic dismantling of these grid-serving biogas plants, which are so important in times of the expansion of renewable energies, it will be important that the national implementation of RED III is pragmatic and in the spirit of a successful energy transition. "
According to the expert, two circumstances in particular are problematic about the 80 percent requirement: "On the one hand, those plants that have so far primarily used renewable ressources must now increasingly switch to substrates that have a higher greenhouse gas reduction, but may be difficult to obtain or not be technically usable. On the other hand, there is currently a lack of standard values for greenhouse gas calculations. Even international research institutions currently have to carry out elaborate and complex calculations, which our farms cannot afford against the background of ever new bureaucratic hurdles," emphasises Rauh.
However, the new regulations open the possibility that long-term subsidies that were granted before RED III came into force can continue under the previous regulations until 31 December 2030 if there is no overcompensation. According to Rauh, this time must be used in order not to endanger renewable energy production from biogas. "Already the extension of sustainability certification to electricity generation from gaseous and solid biomass according to the requirements of the Renewable Energy Directive (RED II), which was implemented in 2022, was disastrous for bioenergy as a whole: Germany decided to implement it faster than all other EU states, although it lacked the necessary legal and organisational foundations. For biogas plant operators, all this is always subject to the risk that even if they fail to comply with formalities - which are often difficult to fulfil - through no fault of their own, they will be threatened with the end of EEG compensation. For a large number of biogas plants, this would mean insolvency. This must not be repeated now with the upcoming implementation of RED III," Stefan Rauh concludes.
Following the decision by the EU Parliament, the European Council still has to formally adopt the text of RED III before it can enter into force. The national implementation of the numerous RED III regulations must then take place no later than 18 months after entry into force, i.e. by spring 2025.
About German Biogas Association (GBA)
German Biogas Association represents the biogas industry in the umbrella organisation of renewable energies, the Bundesverband Erneuerbare Energie (BEE) e.V. With over 4,700 members, it is Europe's largest representation of interests in the biogas industry. The German Biogas Association represents manufacturers and planners as well as plant operators throughout Germany.
According to the revised RED III, biogas plants with a rated thermal input of 2 MW or more that went into operation before 1 January 2021 must prove that they have achieved a greenhouse gas reduction of 80 percent. While the proof of a minimum greenhouse gas reduction for new plants has already been in place since 2021, the sustainability certification of existing plants that have been in operation for 15 years from 2026 will now be extended to include this requirement.
Consequently, this affects larger biogas plants that were connected to the grid by 2011. If biogas plants do not meet the requirements of RED III after transposition into national law, they would lose their entitlement to remuneration under the Renewable Energy Sources Act (EEG). In this context, Dr. Stefan Rauh, Managing Director of the German Biogas Association, points out that we have in Germany a special situation within the European biogas sector: "If you take a closer look at the construction of German biogas plants over the years, you will see that the vast majority of plants were connected to the grid by 2012. The politically subsidised flexible plants, which primarily provide energy in the form of electricity and heat when it is needed, are particularly affected. To prevent a drastic dismantling of these grid-serving biogas plants, which are so important in times of the expansion of renewable energies, it will be important that the national implementation of RED III is pragmatic and in the spirit of a successful energy transition. "
According to the expert, two circumstances in particular are problematic about the 80 percent requirement: "On the one hand, those plants that have so far primarily used renewable ressources must now increasingly switch to substrates that have a higher greenhouse gas reduction, but may be difficult to obtain or not be technically usable. On the other hand, there is currently a lack of standard values for greenhouse gas calculations. Even international research institutions currently have to carry out elaborate and complex calculations, which our farms cannot afford against the background of ever new bureaucratic hurdles," emphasises Rauh.
However, the new regulations open the possibility that long-term subsidies that were granted before RED III came into force can continue under the previous regulations until 31 December 2030 if there is no overcompensation. According to Rauh, this time must be used in order not to endanger renewable energy production from biogas. "Already the extension of sustainability certification to electricity generation from gaseous and solid biomass according to the requirements of the Renewable Energy Directive (RED II), which was implemented in 2022, was disastrous for bioenergy as a whole: Germany decided to implement it faster than all other EU states, although it lacked the necessary legal and organisational foundations. For biogas plant operators, all this is always subject to the risk that even if they fail to comply with formalities - which are often difficult to fulfil - through no fault of their own, they will be threatened with the end of EEG compensation. For a large number of biogas plants, this would mean insolvency. This must not be repeated now with the upcoming implementation of RED III," Stefan Rauh concludes.
Following the decision by the EU Parliament, the European Council still has to formally adopt the text of RED III before it can enter into force. The national implementation of the numerous RED III regulations must then take place no later than 18 months after entry into force, i.e. by spring 2025.
About German Biogas Association (GBA)
German Biogas Association represents the biogas industry in the umbrella organisation of renewable energies, the Bundesverband Erneuerbare Energie (BEE) e.V. With over 4,700 members, it is Europe's largest representation of interests in the biogas industry. The German Biogas Association represents manufacturers and planners as well as plant operators throughout Germany.