Frost: Need for Organic Waste Management Drives Asia-Pacific Biogas Power Generation Markets

June 10, 2008 // Published as a news service by IHS

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Biogas power generation is fast catching on in the Asia-Pacific region as it not only produces power, but also reduces the negative impact of greenhouse gas (GHG) emissions on the environment and helps in effective waste disposal.

According to Frost & Sullivan, continuous exploration of growth potential and the soaring number of biogas project proposals awaiting approval underline the growing interest in the Asia-Pacific biogas power generation markets.

Recent analysis from Frost & Sullivan of the Asia-Pacific biogas power generation markets found earned revenues of $289.0 million in 2007, with estimates to reach $664.7 million in 2014.

"In a move to address growing concerns over global warming and climate change, the U.N. Climate Change Conference was held in Bali, Indonesia, in December 2007, where 190 countries participated and laid out a a broad framework on how to reduce GHG emissions, a key contributor to global warming," said Frost & Sullivan industry analyst Suchitra Sriram.

"GHG emission, especially methane that is emitted from the waste disposed, are paving the way for the the utilization of biogas for power generation in Southeast Asia and in Australia and New Zealand (ANZ)."

Analysts said local authorities and governments across the region are under considerable pressure to streamline the collection, disposal and treatment of waste in order to be socially accountable to their environment and community at large.

As a result, there is growing momentum toward using the organic waste disposed by agricultural and industrial processing units, livestock farms and landfill sites to generate power.

Large-scale biogas power plants above 500 kW capacity are generally installed in landfill sites and sewage (wastewater) treatment facilities, whereas small-scale power plants below 500 kW capacity are largely in demand from livestock farms and agricultural residue processing sectors, analysts said.

High installation costs and unattractive feed-in tariff offered by the utilities are hampering large-scale commercialization of biogas power generation in this region. Analysts said low market penetration of biogas has been attributed to the dominance of biomass power generation among the agricultural and processing end-user units.

"Well-developed power infrastructure and low electricity tariffs are curbing the need for on-site captive power among the industrial end-user segment in Southeast Asia and ANZ," said Sriram. "This apart, lengthy approval processes and bureaucratic delays are impacting the economic feasibility of projects."

Being a policy-driven market, biogas power generation targets need to be monitored, reviewed and revised periodically. It is important to guide project developers on suitable technology, feedstock availability and identifying potential opportunities for development.

Source: Frost & Sullivan.