The Current Status, Potential Benefits and Future Prospects of the Australian Biogas Sector

Anaerobic 
digestion technology provides a new approach to treat organic waste while 
generating greenhouse gas (GHG) savings. Moreover, the 
methane gas produced during the process can be used to generate electricity. In order to ensure that Australia stays on its 
trajectory towards a carbon neutral future, the use of anaerobic digestion technology to treat its abundant organic 
waste streams should be considered. Thirty million tonnes (Mt) of organic waste was produced in 2017. The use of 
anaerobic digestion to treat 1 tonne of waste could result in 0.143 tonne of 
CO2-e in GHG savings. In contrast, other more widely employed waste 
disposal methods such as landfilling, composting and incineration may generate GHG emissions. Additionally, the use 
of methane for electricity production also generates the least GHG emissions 
per MWh. This is approximately 3 times 
lower than crude oil, 4 times lower than black coal and 5 times lower than brown coal. However, the adoption and 
implementation of anaerobic digestion technology in Australia face several 
immediate constraints. Firstly, anaerobic digestion technology is deemed 
unprofitable, incurring high initial 
capital cost, operating costs and extremely long payback periods. Secondly, there is a lack of government support 
in terms of a national target for biogas production via anaerobic digestion. 
This review will provide an in-depth analysis into the current state of the Australian biogas sector. In addition, the review discusses the opportunities to make 
anaerobic digestion technology more financially viable and to accelerate the 
growth of the Australian biogas sector.


Introduction
In the financial year 2017, Australia generated 67 million tonnes (Mt) of waste [1]. Of this, an estimated 30 Mt was organic in nature [1]. The percentage composition of all the different types of organic waste is shown in Figure 1.

Livestock Manure
Livestock manure is a protein-rich substrate. In Australia, livestock manure represented 34% of all the organic waste generated in 2017. Livestock manure is an abundant continuous feedstock. In 2019, Australia had a total of 22 million cows (raised for meat), 2 million dairy cows, 66 million lamb and sheep, 2 million pigs and a poultry flock of 137 million [2].

Bagasse and Wheat Straw
Bagasse is the dry pulpy fibrous residue produced when sugarcane is crushed during the extraction of their juice. Together with grape bagasse, this residue is one of the most abundant lignocellulosic biomass produced in Australia, accounting for 20% of all organic waste generated in Australia in 2017 ( Figure 1). Wheat straw is an abundant agricultural by-product comprising dry stalks from wheat production, typically making up half the total yield of wheat; wheat straw is a lignocellulosic biomass containing cellulose, hemicellulose and lignin. In 2019, Australia produced 15.2 million tonnes (Mt) of wheat [3].

Winery Waste
Australia is one of the leading grape-producing countries in the world; the Australian wine grape crush in 2019 was 1.73 Mt with a long-term average of 1.75 Mt [4] [5]. Wineries have long been regarded as a major source of pollution due to the amount of organic waste generated from the winemaking  process [4]. The different types of waste, their percentage composition, their origins and their current treatments or applications, are outlined in Table 1.

Food Waste
Food waste accounts for 14% of all organic waste generated in Australia in 2017.
Food waste comprises of readily degradable carbohydrates, proteins and lipids.
However, the varying compositions and chemical properties of food waste make it a challenging substrate for reuse. As a result, most food wastes in Australia are sent to landfill for disposal. Excluding hazardous food waste, 4.3 Mt of food waste or 87% of total food waste generated was disposed to landfill in 2017 [1].
In contrast, only 1% of the total food waste was utilised to generate renewable energy [1].

Fate of Organic Waste in Australia
Organic waste can undergo a variety of waste disposal treatments in Australia.
Such treatments include landfilling, incineration, composting and anaerobic digestion. Each treatment carries its own advantages and disadvantages, these are summarised in Table 2.

Landfills
A significant amount (6.7 Mt) of this organic waste was deposited in the landfill in 2017. Landfilling remains one of the most widely employed waste disposal methods and can be defined as the disposal of large quantities of waste onto a land space [6] (Table 2). However, landfilling carries many immediate concerns such as increasing limited availability of space, environmental pollution via landfill gas production, groundwater contamination by leachate and negative impacts on human health [6] [7] ( Table 2). Landfills can continue to be active for 100 years, emitting large quantities of greenhouse gas (GHGs) including methane, carbon dioxide and nitrous oxides into the atmosphere long after closure due to the continuous biodegradation of organics [7] (Table 2). Typically, 1 tonne of waste emits 350 kg CO 2 -e [8]. Landfill gas is composed of 50% -55% methane, 45% -50% CO 2 and 2% -5% of other non-methanic compounds and inorganic compounds [9]. Methane is an extremely potent greenhouse gas (GHG); it is 36 times more effective than CO 2 in trapping atmospheric heat. A total of 8.4 Mt of CO 2 equivalent (CO 2 -e) was emitted from all Australian landfills into the atmosphere in 2015 [10]. However, given proper landfill gas (LFG) collection and treatment, LFG can be used to generate electricity or heat; the LFG emitted from 1 Mt of waste can generate 0.78 MW of electricity [9]. In Australia, modern landfills are equipped with appropriate capture and combustion systems to prevent the emissions of LFG into the atmosphere; pipes are installed in landfills to collect and channel LFG to a combustion device. However, the main purpose of combusting LFG in Australia is to reduce the emission of CH 4 into the atmosphere; CH 4 components are converted into less harmful CO 2 during combustion and emitted. This was further reflected in the study by Emission Assurance Reduction Committee [10], which reported that the total generated CO 2 -e of 16.5 Mt was reduced to a net emission of only 8.4 Mt CO 2 -e in 2015.

Incineration
Incineration of organic waste is another method of management. Incineration can be defined as the combustion of waste with low moisture content and high calorific values using a furnace with temperatures ranging from 750˚C to 1100˚C [6]. Incineration can reduce waste mass and volume by up to 75% and 90% respectively and also incorporates heat and electricity production; it is generally preferred over landfilling [6] (Table 2). While the incineration of waste carries the potential for energy generation, it requires low moisture content for efficient thermochemical conversion [6] [7]. Therefore, only a small portion of all organic waste may be suitable for direct heat and power generation [7] (Table 2). As data for waste incineration is unavailable in Australia, data from the U.S. will be used for comparison. In 2018, 29.5 Mt of waste was incinerated in the U.S. to yield 14 billion KW of electricity; 1 Mt of waste incinerated can yield 48 KW of electricity [11]. However, incineration can potentially generate significant GHG emissions; for 1 tonne of waste incinerated 1381.4 kg of CO 2 , 14.9 kg CO 2 -e of N 2 O and 0.15 kg CO 2 -e of CH 4 can be produced [12].

Composting
Organic waste can also be managed via composting. Composting can be defined as the aerobic degradation of organic matter to produce CO 2 and limit the emission of CH 4 [7]. Composting is simple to operate and has the capability to stabilise organic waste. Although it does not result in energy production, Journal of Sustainable Bioenergy Systems composting can produce a valuable product; compost possesses high agricultural values [7] (Table 2). Composting can be carried out at different scales, either in centralised facilities or in homes [7]. However, the potential for large quantities of methane to be produced and emitted in poorly aerated conditions during composting remains a challenge, especially in home composting systems [7] (Table 2). Composting can release up to 100 kg CO 2 -e of CH 4 and 71.52 kg CO 2 -e of N 2 O per tonne of waste [12]. Composting may also become inappropriate in densely populated urban areas due to hygienic concerns and the need for constant monitoring to prevent the emission of GHG [7] (Table 2).

Anaerobic Digestion
Organic waste can be utilised in anaerobic digestion (AD) to generate electricity and produce other useful digestate products [1]. Anaerobic digestion refers to the natural biodegradation of organic matter with the aid of microorganisms in anoxic conditions [13]. Some examples of these microorganisms are Bacillus, Acetivibrio, Clostridia and Methanobacterium ( Figure 2). Unlike landfills where anaerobic digestion also occurs, the anaerobic digestion of organic waste typically occurs in anaerobic digestion plants using anaerobic digesters under strict conditions. Anaerobic digestion is also highly selective in terms of the type of  [15]. Acetate can also be produced from H 2 and CO 2 by homoacetogens, an H-oxidising acetogenic bacteria [14]. In the last step, acetotrophic and hydrogenotrophic methanogens convert acetic acid and H 2 into a mixture of CO 2 and CH 4 ( Figure 2) [14] [15].
The main product of AD is biogas which, comprises up to 60% CH 4 , 40% CO 2 and a small mixture of other gases such as NH 3 , N 2 O, H 2 S; the volume of other gases produced are dependent on the nitrogen and sulfur content of the feedstock respectively [16] [17] [18]. In particular, the production of CH 4 from organic waste as a result of AD is highly desirable; CH 4 is a promising source of renewable energy [17]. Although CH 4 has long been regarded as a harmful GHG, it can be utilised as an alternative source of energy supply given proper handling [17]. Methane carries the potential for various applications such as heating and electricity generation using fuel cells [14]. Methane can also be upgraded to be used as transportation fuel [14]. A study performed in 2010 on an AD plant in the Netherlands found that 1 tonne of organic waste treated by anaerobic digestion can yield 222.3 KWh of electricity [19]. The Jankadot Bioenergy plant in Australia has reported that it can potentially save 7138.6 tonnes of CO 2 -e from an annual volume of 50,000 tonnes of commercial and industrial biowaste via anaerobic digestion currently, this is the only available data of GHG savings from biogas plants. As such, it can be estimated that 1 tonne of organic waste treated by AD can save 0.143 tonne of CO 2 -e [20]. Gebrezgabher, Meuwissen [19] stated that the use of AD to treat organic waste produces no net carbon emissions.
From Table 2, it can be concluded that the use of AD to treat 1 tonne of waste generates GHG savings of 0.143 tonne of CO 2 -e ( Table 2). In contrast, the use of landfill, incineration and composting all generate GHG emissions; 350 kg CO 2 -e, 1396.45 kg of CO 2 -e and 171.52 kg CO 2 -e respectively. In addition, the use of 1 tonne of organic waste can produce 222.3 KWh of electricity by AD. This is significantly higher than using 1 tonne of organic waste to produce electricity via landfilling and incineration; 0.00078 KW and 0.000047 KW respectively. Unlike the other 3 waste treatment methods, composting does not generate electricity.
Hence, AD represents a good alternative to treat waste in terms of GHG emissions and electricity production.

The Current State of Biogas Production in Australia
Australia relies heavily on oil, coal, non-renewable natural gas and renewable energy for its energy consumption. The energy consumption by fuel type in Australia in the year 2017-2018, in petajoules, is summarised in Figure 3. Like all developed countries there is a heavy dependency on oil, followed by coal and non-renewable natural gas; 38.7%, 29.9% and 25.2% respectively. Renewable energy sources such as bioenergy only make up 6.2% of the statistic. A number of government policies and facilities from the different states in Australia have already been put in place to further develop bioenergy technologies in Australia (Table 3).
From Table 3, only Queensland, NSW and Victoria have invested in large-scale technology and infrastructure to transform organic waste into bioenergy and subsequently, energy in the form of electricity. South Australia, Western Australia and Tasmania are still behind in terms of bioenergy production (Table 3). Queensland, Victoria and South Australia have introduced high levels of funding for the development of new bioenergy technology (Table 3). Queensland, NSW, Victoria and South Australia have made future plans to   [28] expand and develop the bioenergy sector (Table 3). As such, the technological advancements and increase in funding could improve Australia's bioenergy production potential in the coming years. The Large-Scale Renewable Energy Target set by the Australian Government in the year 2000 aimed to generate 33,000 GWh of renewable energy by 2020 [29]. In 2018, this target was already exceeded; renewable energy contributed 49,339 GWh of electricity [30]. Of this the largest source of renewable energy was hydro (15,838.8 GWh), followed by wind and solar, at 14,989.4 GWh and 9930 GWh respectively [30]. The use of biomass only generated 3534.1 GWh of electricity in 2018 [30]. Hence, bioenergy only contributed 7% to the total electricity production by renewable sources in 2018.
Currently, bioenergy projects and activity mainly utilise combustion technology to produce electricity instead of anaerobic digestion. Figure 4 shows the Australian renewable energy consumption by fuel type. From this, it can be concluded that biogas accounts only for a very small portion of all the possible renewable fuel types in Australia; 4.2%. The use of biogas makes up only 0.26% of energy consumption in Australia in 2018. In contrast the combustion of biomass contributed to almost 50% of the renewable energy consumed in Australia in 2018; 3% of total energy consumption ( Figure 4).

Comparison of International Support for the Biogas Sector
Australia currently has an estimated total of 242 AD plants with the majority being municipal waste treatment plants and landfill gas treatment plants [31]. Half of the 242 AD plants are landfill gas plants collecting LFG; the LFG is mostly flared instead of being utilised as an energy source due to the poor quality of methane and the lack of infrastructure for purification processes [20]. Twenty AD plants utilise pig manure and about 18 AD plants use wastewater from meat processing and plants as feedstock for biogas production [31]. There are only 5 AD plants that utilise food waste [31], suggesting that the biogas sector requires significant national development.
When compared to other countries, Australia's biogas sector is still in its infancy (Table 4). There is a lack of a national target in terms of biogas production for Australia; France, Sweden, China, Vietnam and Nepal each have their own specific biogas targets (Table 4). In addition, countries like Germany, UK  (Table 4).

Cost Analysis
When comparing the initial capital costs between wind farms, solar farms and anaerobic digestion facilities, it becomes clear that anaerobic digestion facilities incur a higher cost per MW of capacity. Table 5 provides a comparison in the initial capital cost (ICC) and maximum generating capacity (MGC) of a wind farm, solar farm and a biogas generating facility; the comparison was drawn from projects with similar initial capital costs. Besides, Table 5 also compares the cost of providing 1 MWh of electricity using wind energy, solar energy and biogas generated energy From Table 5, it can be concluded that anaerobic digestion technology requires a higher initial capital cost per MW of maximum generating capacity; up to 27 million AUD could be required to achieve a 1 MW maximum generating capacity. When compared to solar and wind technologies, where an ICC of 29 million AUD and 26.5 million AUD can build facilities with maximum generating capacities of 25 MW and 12.6 MW respectively (Table 5). Furthermore, the cost to provide 1 MWh of electricity is cheapest with solar power, followed by wind power. Anaerobic digestion technology incurs the highest cost to provide 1 MWh of electricity (Table 5).
Profit margin analysis was conducted to reveal the annual revenue, profit and possible payback period for each of the project listed. The formula to calculate annual electricity output for each project is given as follow:

MW C 365 days 24 hours T MWh × × × =
where MW is the maximum generating capacity, C is the capacity factor and T is the annual total output of electricity. The capacity factor is the ratio of actual generation output to the maximum output over a year. Wind and solar technology are both environmentally dependent and hence, have much smaller capacity factors compared to anaerobic digestion. Wind technology has a capacity factor of between 0.2 to 0.4 (20% to 40%) while large scale solar farms have a capacity factor of around 0.21 (21%). In contrast, anaerobic digestion technology has a capacity factor of between 0.6 to 0.85 (60% to 85%). For ease of comparison, only the highest capacity factors will be used. The total annual revenue was calculated by multiplying the annual total output by the spot price for electricity/MWh. The spot price for electricity in NSW and VIC are $A79/MWh and $A84/MWh. The annual cost can be calculated by multiplying the annual total output by the cost to produce 1 MWh (Table 5).
From the 3 projects with similar initial capital costs, the project utilising AD appeared to be the least profitable with an extremely long payback period compared to the projects utilising solar or wind technology.
In order for AD plants to achieve financial viability, supporting policies and schemes from the government are required, such as the Emission Reduction Fund ( Table 4). The biggest challenge faced by the Australian biogas sector is the lack of industry experience which has translated into high capital costs and small generating capacity [20]. This is especially true when it comes to estimating capital cost and sizing of the generator's capacity during its construction; the lack of reliable data and guidelines may potentially result in extremely high financial risks for biogas project development and operation [20].

Financial Viability Case Studies
To better illustrate the various factors contributing to the financial viability of a biogas project, a comparison will be made between 3 different completed biogas projects in Australia. These projects will be cross analysed in terms of funding, feedstock, fate of digestate, power purchase agreement and government incentives eligibility. Given the status of industry experience for AD technology in Australia, the capacity factor and operation and maintenance cost will not be factored into this comparison.
The Goulburn Bioenergy plant is the most financially viable amongst the 3 biogas projects. Firstly, approximately 33% of the project's capital cost was funded by ARENA; it has the lowest capital cost (Table 6). This was higher than the Jankadot Bioenergy plant which had 16% of its capital cost funded by Clean Technology Investment program and Western Australia State Government ( Table 6). The Rewaste plant did not receive government funding, it was also the most expensive project in terms of capital cost. Secondly, the Goulburn Bioenergy plant gets its feedstock directly from the Southern Meats abattoir ( Table 6). The plant is situated next to the abattoir to treat its industrial wastewater. This eliminates any Journal of Sustainable Bioenergy Systems  [36] cost involved in the purchase and transportation of feedstock. Unlike the Goulburn Bioenergy plant, the Jankadot Bioenergy plant and the Rewaste plant have to obtain their feedstock from suppliers, resulting in higher Levelised Cost Of Electricity (LCOE) ( Table 6). Thirdly, the Goulburn Bioenergy plant has a 20 years power purchase agreement with Southern Meats abattoir; the plant operates independently from the abattoir, but the electricity produced will be purchased (Table 6). This helps to strengthen the long-term financial viability of the project. Presently, there are no power purchase agreements for the other 2 plants; the lack of PPAs can translate into a lack of reliable income and may contribute to long term financial constraints (Table 6).

Annual GHG Emission of Australia
In March 2020, Australia's annual GHG emission was estimated to be 528.7 Mt CO 2 -e [37]. Table 7 shows the annual emissions by the different sectors, their percentage contributions and a synopsis of how GHG is produced and emitted. Based on Table 7, the combustion of fuel to generate electricity contributed the most to the annual GHG emission of Australia, up to 172.9 Mt CO 2 -e in the year 2020. Other sectors dependent on the combustion of fuel for energy also contributed significantly to the annual GHG emission; transport sector with 99.7 Mt CO 2 -e and stationary energy sector with 102.7 Mt CO 2 -e ( Table 7). The agriculture sector contributed 68 Mt CO 2 -e and the waste sector contributed 13.1 Mt CO 2 -e.

Potential GHG Savings from Biogas Sector
Australia ratified the Paris Agreement to reduce net GHG emissions by 26% -Journal of Sustainable Bioenergy Systems  [39]. Australia has also committed to a net-zero emission as set by the Paris Agreement by the second half of this century. Moreover, NSW and leading businesses such as AGL, Amcor, Westfarmers and Telstra are committed to a net-zero emissions economy by 2050 [39]. In order to achieve this, the potential GHG savings through the biogas sector cannot be ignored. As aforementioned, the use of AD to treat organic waste results in no net carbon emissions [19]. The direct way to reduce GHG emissions using AD technology is to replace existing methods of waste treatment that are generating GHG emissions. Currently, landfills are major contributors to the GHG emissions from the waste sector. Other sources of GHG emissions that can be directly replaced by AD technology include the incineration of waste, as well as the treatment of animal manure via anaerobic lagoons. Presently, industrial and agricultural AD plants mostly employ anaerobic lagoons to facilitate AD which, can generate up to 118 kg CO 2 -e per tonne of waste [31] (Table 8). However, anaerobic lagoons are typically used as a pre-treatment for organic waste treatment processes; anaerobic lagoons allow for the separation of sludge from liquid and generally not optimised for AD, functioning mainly as holding tanks; organic stabilisation can take an extremely long period of time and there is potential build-up of inhibitors within the lagoons. Hence, the diversion of organic waste away from these 3 methods of waste treatment and to biogas plants would generate GHG savings.
The indirect way to reduce GHG emissions would be to utilise biogas synthesised from AD plants to generate electricity instead of fuel combustion. While the current status of AD technology in Australia might not allow for biogas Journal of Sustainable Bioenergy Systems Composting 171.52 kg CO2-e Kristanto and Koven [12] to substantially replace coal, crude oil and natural gas to generate electricity, the use of biogas where possible would contribute to GHG savings. The use of biofuel such as methane for transportation can further contribute to GHG savings. However, given the status of the biogas sector in Australia, the use of biofuel would require an accelerated level of research and development. Table 8 illustrates the GHG savings from utilising AD technology to treat 1 tonne of organic waste as opposed to other waste disposal methods. In 2017, Pickin, Randell [1] reported 6.7 Mt of organic waste going into landfills in Australia. As a result, it can be concluded that around 2,345 Mt of CO 2 -e was produced using the value of GHG emission/tonne of waste given in Table 8. In addition, 7.3 Mt of organic waste was recycled via composting; this has the potential to generate approximately 1.25 Mt of CO 2 -e. If the same amount of organic waste was diverted away from landfill and composting into biogas, it would have produced 2.02 Mt of CO 2 -e in GHG savings. Additionally, the anaerobic digestion of 14 Mt of organic waste has the potential to generate approximately 3388 GWh of electricity; this can power an estimated 320 million houses [40]. The diversion of organic waste away from landfill and composting could have potentially increased the electricity generated using biogas in Australia in 2017 and produced GHG savings.
The use of biogas from AD technology to generate electricity produces the least GHG emission per MWh; 0.251 tonne per MWh [41]. This is significantly lower than that of black coal and brown coal; 0.88 tonne per MWh and 1.22 tonne per MWh respectively [42]. The use of crude oil to generate electricity produces approximately 3 times the amount of GHG emission as the use of biogas, 0.78 tonne per MWh [42]. Lastly, the use of natural gas produces about twice as much GHG emissions as biogas, 0.53 tonne per MWh [42]. As such, the use of biogas to generate electricity is the most desirable in terms of GHG emissions.
In 2017, Germany generated a total of 32,500 GWh of electricity using biogas from the anaerobic digestion of organic waste [43]. This ultimately translated into 27 Mt of CO 2 -e in GHG savings [43]. In contrast, Australia in 2017 only generated 4472 GWh of electricity using biogas [22]. Since data for GHG savings from biogas usage is not available for 2017 in Australia, value from Germany was used to estimate GHG savings in Australia. Electricity generation of 4472 GWh by biogas translates into only 3.7 Mt of CO 2 -e in GHG savings. The environmental pay off from the use of biogas a fuel source to generate electricity is immense, as illustrated by Germany.

Recommendations and Conclusion
Given the current status of the biogas sector in Australia, it will be extremely difficult to fully utilise organic waste to generate biogas for energy. The LCOE of using biogas is presently not financially viable due to 2 main factors: the lack of government support and the difficulty in obtaining feedstock. There are two recommendations for new investors to achieve financial viability in the biogas sector. The first would be the construction of biogas plants within the proximity of a feedstock supplier; biogas plants with on-site feedstock will have a lower LCOE by removing the cost of transporting feedstock. Secondly, biogas plants should also strive to obtain long-term PPAs to improve financial viability.
While the use of AD technology to treat organic waste in Australia may seem ineffective and unprofitable, the potential GHG savings cannot be ignored; anaerobic digestion does not generate GHG emissions and the combustion of biogas to generate electricity produces the least GHG/MWh. The development of the biogas sector in Australia will contribute to less carbon emissions and propel Australia into a carbon neutral future.