NEDO’s Demonstration Projectfor Self-sustaining Local Biomass Energy Systems

Introduction requirements
and technical guidelines
on self-sustaining local
biomass energy systems【Digest version】

contents
P02■ 01.What are the uses of biomass?

P02■ 02.Three main points regarding the use of biomass energy

P03■ 03.Economic effect of the use of woody biomass

P03■ 04.Ripple effect on local communities

P04■ 05.Significance of system selection(methodology) based on potential
raw material (Entrance) and energy demand strategy (Exit)<Woody biomass>

P05■ 06.Flow of the realization of woody biomass energy business

P06■ 07.Checklist for the implementation of a sustainable energy business(woody biomass)

P07■ 08.Two major characteristics of methane fermentation business

P07■ 09.Positive effects on local communities from Methane fermentation
business

P08■ 10.Significance of system selection(methodology) based on potential
raw material (Entrance) and energy demand strategy (Exit)<Methane fermentation>

P09■ 11.Flow towards successful methane fermentation biomass energy
business

P10■ 12.Checklist towards sustainable business【methane fermentation】

P11■ 13.D e m o n s t r a t i o n P r o j e c t f o r S e l f - s u s t a i n i n g L o c a l B i o m a s s
Energy Systems■ Overview Section■ Woody Biomass Section■ Methane fermentation biomass section

Overview Section

01

What are the uses of biomass?

Biomass is defined as "renewable, organic resources of biological origin, excluding fossil resources". Biomass consists ofbiomass resources used as raw matrial, types of energy use(electricity, heat, transport fuel, etc.,), and the energy conversion
technology that interconnects these. Biomass utilization methods are broadly divided into materials utilization used forlumbering/construction and energy utilization. It is possible to make effective use of such resources by first using them as aenergy source and then by finally using them as fuel, in a cascading manner. Depending on the application, it is also possible
to convert such resources into liquid fuel, to be used in transportation. CO2 is of course generated when it is burned in thisprocess, but this is CO2 that was already absorbed from the atmosphere during the growth processes of forests and otherecosystems, if these are sustainably managed. Therefore, biomass energy is classified as a form of renewable energy.

Raw material procurement

Conversion technology

×

Woody biomass

Gas fuel(Biomass-derived methane, etc.)

Liquid fuel(Bioethanol, jet fuel, etc.)

02

Heat

CH4

Sewage sludge Food waste

Microalgae
raw material

Usage form

Power generation(Wood pellets, chips, etc.)

Use

Livestock
manureSolid fuel production

Conversion

Methane fermentation
system×

Fuel for transportation use

Concentration/
separation
Extraction/
purification

Three main points regarding the use of
biomass energy

Biomass energy is significant as a business model because it can reduce fossil fuel usage and thus reduce cost, and it canbring profit via energy sales. However, biomass energy is not just significant from an economic standpoint—it also hassignificance for local communities and fostering of local symbiosis, such as in the revitalization of local agriculture,
forestries, and industry, along with aiding the preservation of national land and the creation of jobs.
Which significance is emphasized depends on the business models and the business entitie(i.e., private sector or public
sector). In order to conduct a biomass energy-focused business, it is important to share the purpose and significance of suchan endeavor, due to it being essential that all stakeholders engage in mutual cooperation.

● Reduction of fossil fuel cost
● Income from electricity sales,

Economyheating sales, gas sales(feasibility)● CO2 reduction● Revitalization of agriculture,● Forest protection● SDGsEnvironment

Society(local communities)

forestry, and local industries● Job creation● Improvement of the living

environment(reduction of offensive odors, etc.)

Introduction requirements and technical guidelines on self-sustaining local biomass energy systems【Digest version】

02

Woody Biomass Section

03

Economic effect of the use of woody
biomass

The biomass fuel used for woody biomass boilers is carbonneutral, and the boiler generates less sulfur and nitrogen thanfossil fuels, and is stable in price.
On the other hand, biomass boilers have the disadvantage in thatthey require a certain large amount of space due to being
relatively large in size, thus requiring a facility for carrying in fueland silos, and this results in increases to initial cost.
However, the fuel cost per calorific value is low, so if a certain
operating rate can be secured, economic advantages over using
fossil fuels would become clear, from a medium- to long-term
perspective.

Overview of a comparison of biomass boilers
and fossil fuel boilers
Incurred
costs

Initial cost high,but longer operating time brings
economic benefits

Initial investment for aheavy-oil boiler

Initial investment for abiomass boiler

Biomass boiler fuel costs
and O&M costs
Fuel cost and O&M cost forheavy oil boilers

Boiler operating time (≒ total amount of heat produced)

Fuel cost per calorific value (example)
Fuel type

Fuel unit price

Lower calorific value

Fuel unit price per MJ

Unused material chips
Construction waste chips

17.2〜18.9 yen/kg(DB)8.1 MJ/kg(50%WB)

1.1〜1.2 yen/MJ

3〜5 yen/kg(WB)

14.5 MJ/kg(20%WB)

0.2〜0.3 yen/MJ

Heavy oil A

68.2〜82.3 yen/L

36.6 MJ/L

1.9〜2.2 yen/MJ

City Gas

51.2〜59.8 yen/m3

40.6 MJ/m

3

1.3〜1.5 yen/MJ

LNG

50.4〜65.4 yen/kg

49.2 MJ/kg

1.0〜1.3 yen/MJ

04

Ripple eﬀect on local communities

From the upstream to the downstream, biomass has a long value chain, and its stakeholders are diverse. Therefore, there arecertain difficulties that are unique to biomass-related business, such as in the need for the stable procurement of raw materials
and the formation of various agreements with local stakeholders. However, to put it the other way around, these value chain
and stakeholder issues mean that biomass-related business can relay major economic benefits to surrounding operational
areas. The image below shows an example of the estimation of comprehensive local economic effects based on a 1 MWe
combined heat & power supply example (FS) from a NEDO project.
If we were to not use biomass in this example, about 6 billion yen for electricity and heat would flow out of the region over 20
years, and we would incur costs for processing biomass (bark etc.), as a local issue. On the other hand, if local biomass isused for combined heat and power supply as according to the demonstration project plan, not only would the outflow of energy
purchases be stopped, but 550 million yen would be circulated to those involved in agriculture, forestry, construction, andmaintenance operations in the local region, and the tax revenue of the local government would increase by 400 million yen.
After starting a renewable energy business(20 years)

EmployeeincomeHeating fee payments
1,200 million yen

Electricity bill payments
4,500 million yen
Tax payments/interest rate

(total)Business profit fromrenewable energy
2,100 million yen

200 million
yen

er

rd

O
s

Payments for electric powerfrom out of region
1,500 million yen
Waste disposal cost(of the waste generator)

Forester/farmer profit+ disposable income
60 million yen

Ta
xp
ay
me
nt
s

Payments forforeign-region fuel6,000 million yen

Local business sales(after tax)

500 million yen

250 million yen

03

Image of money flows after 20 yearsof business in heating andpower supply cogeneration via biomass(total for 20 years)

Introduction requirements and technical guidelines on self-sustaining local biomass energy systems【Digest version】

Local tax revenue/
interest rate

From renewable energy business
1,900 million yen(total amount)

400 million yen

From local affiliates
1,200 million yen
Sales from businesses outside the region(before tax)

Woody Biomass Section

05

Significance of system selection(methodology) based on potential
raw material (Entrance) and energy demand strategy (Exit)<Woody biomass>

For woody biomass, various types of raw biomass fuel exist, and the properties of such vary depending on the amountof moisture contained (i.e., dryness). In addition, there are multiple options depending on the technology to be
employed, and this depends on the energy supply mode—and available fuel types and properties for such also differ.
For example, BTG (Boiler, Turbine, Generator) is a technology that generates electric power by using the steam
generated by directly burning wood chips and pellets in the biomass boiler. power. Most of Japan's biomass power
plants use this technology. Here, fuel tolerance level is large, but on the other hand, power generation efficiency drops
to below 20% at the small scale of 2 MW or less, thus 5MW and above is common. In another example, ORC (Organic
Rankine Cycle) is a technology that rotates a turbine by evaporating a polymer organic medium for which the boilingpoint is lower than that of water. ORC has a track record of more than 300 in use in Europe, where heat utilization iscommon. While this method has high fuel efficiency and can handle bamboo and bark, it is viewed that it is essential tosecure a corresponding heat demand destination because of the massive heat generated by this method.
In yet another example, pyrolysis gasification is a technology that gasifies wood chips or pellets via a
pyrolysis/reduction reaction and that uses the resulting gas as fuel to generate electricity. Although it is possible toobtain relatively high power generation efficiency even on a small scale, this method is extremely delicate with respect
to fuel type and water content; thus, securing stable quality such as regarding chip/pellet shape and water content is
the most-important issue involved in this method. It is thus important to consider the system, not the technology itself,along with the type and properties of the raw fuel (“entrance”) that can be procured, as well as the energy demand(“exit”).

Scale of fuel /energy and standards of technology

Entrance(Raw materials procurement/
fuel production)①Forested area

Rough estimate of forested area
required for the log production
volume indicated in ②

100ha

130ha

250ha

②

Log production
volumeRough estimate of log production
volume required for chip production
volume indicated in ④

37,000㎥/y

50,000㎥/y

98,000㎥/y③Pellet production
volumeRough estimate of pellet production
volume required for power generation
capacity indicated in ⑤

15,000t/y

20,000t/y

37,000t/y

Rough estimate of chip production
volume required for power generation
capacity indicated in ⑤

30,000t/y

40,000t/y

75,000t/y

Chip production④ volume

Conversion
technology(Equipment/
industrial facilities)

Biomass
boilers

Gasification

Exit(Energy supply/use)Power generation⑤ capacity

ORC

BTG

1,000kW2,000kW5,000kW

Available electricity⑥ supply

Available electricity supply
volume when using BTG for
power generation capacity
indicated in ⑤

7GWh/y16GWh/y

40GWh/yAvailable heat
⑦ supply

Available heat supply
volume when using biomass
boiler for chip production
volume indicated in ④

200TJ/y

250TJ/y

500TJ/yNote: Thermal demand volume for large saw mill is approximately 500TJ/year, while that of hot spring accommodation facility is 1-20TJ/year.

Power generation only
(medium/large scale)Heat and power combined

Heat utilization/supply(Boiler・Turbine Generator)

BTG

ORC

Unused forest materials○○

content△ Waterless than 15%

content○ Waterless than 40%

content○ Waterless than 60%

Residual sawmill materials○○△ less than 15%

Water content○ less than 40%

Water content○ less than 60%

Construction waste

○

○

×

○

○

Bark

△

△

×

×

△ less than 55%

Bamboo

△

○

×

×

○

Pyrolysis gasification

Dry chip boiler

Wet chip boiler
Water content

Water content

Introduction requirements and technical guidelines on self-sustaining local biomass energy systems【Digest version】

04

Woody Biomass Section

06

Flow of the realization of woody biomassenergy business

From concept to realization, woody biomass energy business energy business comes with many action items. With thatin mind, NEDO's biomass energy introduction requirements/technical guidelines* explain the points to be noted, thedetailed information, and the various data behind each action item.
(*The information as provided in the English guidelines only consists of summary information. For more details, pleaserefer to the original Japanese version.)
Note: Green text indicates introductory requirements/
technical guidelines.

Overview: Action items for woody biomass energy business
PhaseⅠConception

Phase Ⅱ Feasibility Study

A. Business plan

Action items related to the complete edition(Chapter 1 of this volume)
Action items related to raw
materials/fuel procurement(Chapter 2 of this volume)
Action items related to equipment
installation(Chapter 3 of this volume)
Action items related to the use andtreatment of energy and by-products(Chapter 4 of this volume)05

1.1.Ⅰ.A Building of a business concept
1.2.Ⅰ.A Business model outline study

Re-examination and confirmation

1.3.Ⅱ.A of the business concept
1.4.Ⅱ.A Consideration of thecommercialization schedule

B. Implementation system/local cooperation
1.8.Ⅰ.B
1.9.Ⅰ.B

Becoming a business entity
Consulting with experts

1.10.Ⅰ.B Consulting with governments

Commercialization system

1.11.Ⅱ.B construction, role adjustment

with local
1.12.Ⅱ.B Consensus-building
stakeholders

1.13.Ⅱ.B Holding of local councils

Council meeting explanations
1.14.Ⅱ.B (for local governments)

Phase Ⅲ Design and Construction
1.5.Ⅲ.A Review of future business plansof a facility
1.6.Ⅲ.A Formulation
operation management plan

1.15.Ⅲ.B Composition of the business entity
1.16.Ⅲ.B Hiring of staff

1.17.Ⅲ.B Local consensus-building

Phase Ⅳ Operation
Consideration of optimizing

1.7.Ⅳ.A operation plans

1.18.Ⅳ.B

Fostering of
local understanding

C. Business's balance sheet/financing
1.21.Ⅱ.C Project cost estimation
balance sheet
1.19.Ⅰ.C Business's
outline study

a survey budget
1.20.Ⅰ.C Obtaining
for FS researchBusiness's balance sheet,

1.22.Ⅱ.C cashflow analysis

1.23.Ⅱ.C Confirmation of the subsidy system
1.24.Ⅱ.C Business's risk assessment
1.25.Ⅱ.C Budget formation

Application for equipment

1.26.Ⅲ.C assistance

Application/contract for carbon

1.27.Ⅲ.C offsetting

Financing, negotiation with

1.28.Ⅲ.C financial institutions

Checking the trends of related

1.29.Ⅲ.C support systems

D. Ripple effects

Verification and disclosure
1.32.Ⅳ.D of ripple effectsof the ripple effect1.31.Ⅱ.D Evaluation
by business

A. Procurement of raw materials and fuel2.3.Ⅱ.A

2.1.Ⅰ.A
2.2.Ⅰ.A

Specifics of raw fuel type

Confirming local availabilityof raw material scale

2.4.Ⅱ.A
2.5.Ⅱ.A
2.6.Ⅱ.A
2.7.Ⅱ.A

B. Fuel production
Confirmation of a base for2.12.Ⅰ.B fuel manufacturing

Survey of resource amounts
Confirmation of handling for cleaning
methods
Possibility of survey on raw material
collection
Consideration of raw fuelprocurement costs
Study of raw fuel transportation
systems

2.8.Ⅲ.A
2.9.Ⅲ.A

Fuel procurement contracts(standard lot delivery pricing)
Formulation of fuel procurement
and inventory management plans

2.10.Ⅳ.A received fuelBasic design

3.14.Ⅳ.A equipment performance

Procurement of equipment

and improvement
3.15.Ⅳ.A Verificationof the facility utilization rate
3.16.Ⅳ.A Safety measures

3.2.Ⅰ.A

Verification and review of fuel2.11.Ⅳ.A procurement conditions

Confirmation of compliance with
Study of a fuel manufacturing/

2.14.Ⅱ.B processing system

3.3.Ⅱ.A
Confirming the reliability ofequipment technology
Confirmation of equipment
scale and investment scaleConfirmation of standards for2.13.Ⅱ.B fuel standards

A. Installation of equipment

3.1.Ⅰ.A

Verification and1.30.Ⅳ.C improvement of businessprofitability

Selection of an appropriate scale

3.4.Ⅱ.A

Formulation of a basic system plan

3.6.Ⅱ.A

Study regarding fuel receiving &storage systems
Examination of an equipment/
construction ordering scheme

3.5.Ⅱ.A Selection of equipment/manufacturer
3.7.Ⅱ.A

3.8.Ⅲ.A
3.9.Ⅲ.A
3.10.Ⅲ.A
3.11.Ⅲ.A
3.12.Ⅲ.A
3.13.Ⅲ.A

Final design

Construction, EPC contracting
O&M contracting

Insurance contracting

System/evaluation and improvement

Study of the in-house

3.17.Ⅳ.A production of O&M
3.18.Ⅳ.A Troubleshooting

B. Compliance with laws and regulations
Confirmation and response to

3.19.Ⅱ.B laws and regulations as related toequipment installation

3.20.Ⅲ.B

Acquisition of permits andnotifications for business
implementation

C. Location selection
3.21.Ⅰ.C Site assumption

A. Energy supply/use

4.1.Ⅰ.A
4.2.Ⅰ.A

Assumption of energy use
Specifics of the energy supply
form

3.22.Ⅱ.C Location survey

4.3.Ⅱ.A
4.4.Ⅱ.A
4.5.Ⅱ.A
4.6.Ⅱ.A
4.7.Ⅱ.A
4.8.Ⅱ.A

Survey of energy demand
Survey of the actual operation ofexisting energy equipment
Infrastructure survey of the installationsite and the surrounding environment
Confirmation of intentions regarding
the installation destination
Study of an energy supply &demand management system
Backup system consideration

B. System connection
4.11.Ⅱ.B Grid interconnection survey

4.9.Ⅲ.A Energy supply contracting

4.12.Ⅲ.B
4.13.Ⅲ.B

Verification and review of

4.10.Ⅳ.A the energy supply conditions

FIT business application
Connection contracting,power sale contracting

C. By-product treatment/use
Examination of the disposal method

4.14.Ⅱ.C for by-products

Discussion of conditions regarding

4.15.Ⅲ.C the effective use of by-products

Introduction requirements and technical guidelines on self-sustaining local biomass energy systems【Digest version】

and the processing of suchExamination and adjustment

4.16.Ⅳ.C for the effective use of
by-products

Woody Biomass Section

07

Checklist for the implementation of asustainable energy business (woody biomass)

In the introduction requirements/technical guidelines, based on an analysis of past precedents, the points to be notedin each action item shown on the previous page are organized as a checklist, and we have put together a concrete
explanation of each item and the "devices" that the Feasibility Study(FS)/demonstration project has worked on.
■ Checklist for an energy business involving woody biomass (excerpt from the conceptual stage)
Division

Action items

Building of a businessconcept

Corresponding items inPart 2 of this volume

1.1.Ⅰ.A

Notes

Check

Is the purpose of business organized? Also, can you share such purpose withstakeholders?
More than the purpose or needs of the business, is the technology and equipment to be
adopted and the planning and business skill required decided beforehand?
Do grants and subsidies precede the decision on the purpose and necessityof the business?
Are there any elements in the plan that could cause opposition in the local area?
Is your plan subject to the problem from social perspective?

Overview section

Business model outline
study

1.2.Ⅰ.A

Becoming a business
entity1.8.Ⅰ.B

Have you assumed implementers and bases involved in raw materials procurement/
processing, equipment operation, and the energy/use of by-products/refinement?
Is it a business that requires a special license, and is such a license expected to beacquired?
Is there a plan where only the vision provides forward impetus as something that cannot beenvisioned by the business entity itself?
Is there a person in charge that can play a central role in the realization of the business,and has a support system been established for such?
Is it possible to envision a business entity that includes financial and execution capabilities?

Consulting with experts
Consulting with local
governments
Business's balance sheet
outline study

1.9.Ⅰ.B
1.10.Ⅰ.B
1.19.Ⅰ.C

Raw material/fuel procurement

Obtaining a survey budget
for FS research

1.20.Ⅰ.C

Specifics of raw fuel type2.1.Ⅰ.A

Have you consulted with and received advice from experts, specialized agencies,
and support organizations, etc., regarding the implementation of the business concept?
Have you consulted with or provided information to the local governments regarding
the business concept? Is it possible to obtain the cooperation of such governments?
Do you have a target for profit structure and profitability (i.e., reduction of processing costs,
power sales/heat sales, reduction of energy costs, etc.)?
Is it possible to secure an FS budget that includes the utilization of the list for national
supplementation?
Is it possible to build an FS survey implementation system that includes reliable technicalexperts and specialized institutions?
Have you identified the types of raw fuel that you will use? Have you confirmed that suchcan be procured locally?
Have you confirmed the trends in raw materials and fuel prices and the level of competition
with other raw materials?
Have you confirmed the properties of the raw materials or fuels as candidates for
procurement in the local area?
Did you confirm the water content in the raw materials and fuels to be used?
Also, do you have an accurate understanding of the moisture index of such?
Did you know the density of the raw materials and fuels to be used?
Also, do you understand the conversion method for the volume and weight?
Did you compare the value of wood for fuel and wood for other uses?
Have you compared the value of the envisioned biomass fuel and fossil fuel?
Have you confirmed whether the raw materials are valuable or should be considered waste?
Did you also consider measures regarding Wastes Disposal and Public Cleansing Act?

Installation of equipment
Utilization andprocessing of energy
and by-products

Confirming local availabilityof raw material scale

2.2.Ⅰ.A

Confirmation of a basefor fuel manufacturing

2.12.Ⅰ.B

Confirming the reliabilityof equipment technology

3.1.Ⅰ.A

Confirmation of equipment
scale and investment scale

3.2.Ⅰ.A

Site assumption

3.21.Ⅰ.C

Assumption of energy use

4.1.Ⅰ.A

Specifics of the energy
supply form

4.2.Ⅰ.A

Have you assumed a required scale for the raw fuel to be used?
Do you understand the types and characteristics of the fuel that you expect to procure?
Is there a production base for fuel such as chips and pellets, etc., in the suburbs,
or is the development of a new base planned?
Did you confirm that the equipment/technology that you plan to introduce has a proven trackrecord of introduction on a commercial basis rather than simply as part of a demonstration project?
In the case of overseas products, are you assuming an import route to Japan?
For such overseas products, has a sample of the fuel to be used been presented byand obtained from overseas?
Did you understand the types and characteristics of the technologies that you plan to
introduce (e.g., BTG, ORC, pyrolysis gasification, heat utilization boiler)?
Do you understand the construction cost and investment scale of the entire system,
not just the equipment alone?
Did you confirm that there is no problem with the topography or geology? (It would be good if the existence of past disasters,
the possibility of disaster hazards, whether there is sufficient earth-bearing capacity, past land use could be confirmed.)
Can you envision a site that takes into account the biomass fuel procurement distance? Can you envision a site that takes into
consideration the surrounding environment, access roads, water, electricity, and other infrastructure such as communications?
Can you assume where the heat will be supplied to?
Do you understand the usage status of biomass energy and the characteristics of heatusage by sector?
Can you assume the heat medium (hot water, steam, etc.) required by the customer andthe scale of heat demand expected?
Is the target region an area where the capacity of local power systems is tight?

Introduction requirements and technical guidelines on self-sustaining local biomass energy systems【Digest version】

06

Methane fermentation biomass section

08

Two major characteristics of methane
fermentation business

While one notable characteristic of methane fermentation business is to produce and utilize renewable energy, more
important characteristic is the recycling of organic materials(including waste disposal process) for the purpose ofenvironment conservation. Once releavant facility is up and running, as a local waste material processing infrastructure, it
has to accept various kinds of waste materials and biomass resources discharged from relevant parties on a daily basis.
As its business plays such an important role in the local area, it can not be halted easily. Therefore, it is necessary toconsider this business from mid to long term business perspectives which can be continued even after current Feed in Tariff
will end in 20 years time.

Organics recycling(including waste disposal)

Methane fermentation
facility・Public project・Private project

For renewable energy usage(waste disposal business,
livestock industry, food industry, etc.,)

09

For environment conservation

・Food recycle
・Reduce sludge
・Process of human waste
・Process of livestock manure
・Process of highly concentrated waste liquid・Odor control

Energy facility

・Power generation・Heat utilization
・Fuel utilization

Positive effects on local communities
from Methane fermentation business

As methane fermentation is capable of accepting various kinds of biomass, including raw materials with higher percentage ofmoisture content as well as mixed impurities,it can process all at once. Due to such an advantage, some local governments canstreamline the infrastructure of waste disposal process by methane fermentation such as processing both human waste andraw garbage from residential household and food waste from the industry by a single methane fermentation facility. Additionally,methane fermantation has other significant benefits that can help reduce foul odors from livestock waste as well as stable
renewable energy due to its small output fluctuation. Since its fermentation residue is rich in manure components(e.g., nitrogen,phosphorus and potassium) , it can be effectively utilized as a good manure for field crops. Because water treatment andincineration disposal processes will be required if liquid fertilizer(digestive fluid) or compost can not be supplied to others, it isnessary to secure those types of ‘exit’ strategy in advance for truly sustainable business.
Possible to reduce
offensive odors”Batch process” is possible
for various wastes

Livestockindustry

Possible to process
segregation difficult /high moisture wastes

Possible to provide energy
in a stable mannerLivestock
manureProduction
activity

Food
residue（Food factory）

Agriculture

Electricity・Heat

Industrial
waste（Mainly food waste）

Retail shop
(Supermarket)

HouseholdHouseholdwaste（Mainly food waste）

Human
waste
Sewage plant07

SewagesludgeIntroduction requirements and technical guidelines on self-sustaining local biomass energy systems【Digest version】

Digestive liquid
Possible to use digestive
liquid at farmland※also an issue

Methane fermentation biomass section

10

Significance of system selection(methodology) based on potential
raw material (Entrance) and energy demand strategy (Exit)<Methane fermentation>

Methane fermentation technology is broadly categorized in 2 types, which are ‘wet’ and ‘dry’ methane fermentation technologies but both are
the same biological response process technology. The difference is the system structure suitable to the nature of the material used for theprocess.
For wet methane fermentation technology, its system is made most suited to process slurry raw material with higher water contents so that it
became widely used in Japan to help reduce volume of the sewege treatment, as well as to properly dispose human waste and livestock
manure. However, in order to avoid any potential blocks to the equipment and pipes, as a general rule, the waste generator is required to sortout wastes and remove any foreign objects on their side, to some extent. Additionally, they need to consider how to utilize digestive fluid
produced as a result of the process, as well as water treatment. On the other hand, dry methane fermentation technology is made mostly suited
to process solid raw material and it became widely used since 1980s in Europe in order to reduce a burden at final disposal site to be used asenergy and as a system to produce compost. Based on such background, it gradually started to be used nowdays in Japan. As long as the
moisture content of the raw material used is properly managed, solid residue will be created which can be best utilized as a compost andthermally recycled.
One important point at this point, is not to focus too much on technology such as wet or dry systems, but rather on a system based on ‘Entry’and ‘Exit’ strategies of methane fermentation facility. In order to select most suitable system, first of all, you need to thoroughly understand main
characteristics of the biomass you would like to process and use, and also take into consideration of all the other factors involved such as whowill utilize those residues expected as a result (liquid fertilizer and compost) or whether there is a third party who can process them, etc., For
example, Fuji Clean Co., Ltd. (Industrial waste disposer), has succesfully implemented a dry methane fermentation system as it could process
food waste and waster papers that were difficult to recycle, the company already had its own incineration facility on site and it was also difficult
to build a water treatment facility due to its mountaineous location. The system started its operation in 2018 and has been running succesfully.

From ‘Entry’
perspectives❶ Raw material moisture content
High
Low

Suitable for Wet(Dry system can be used withdewatering process)

Methane fermentation
facility
Wet or Dry systems

Suitable for Dry（Wet system can be used tosome extent with moisture adjustment）❹ Existence of water processing facility
Yes

Favorable to Wet system(For Dry system, simplified
water processing system is required)No

Favorable to Dry system(Wet system can be used
if water processing facility is newly built)❺ Existence of incineration facility❷ Items not suitable forfermentation
for Dry (Wet system can be used toMany Suitablesome degree with proper separation)

LittleFrom ‘Exit’
perspectives

Suitable for both Wet and Dry systems

Yes

Favorable to Dry system(heat from residue canbe recycled)

No

Favorable to Wet system(Dry system can be used
if dry residue can be made as compost)❻ Utilization of fermentation residue

Option to use digestive fluid(Liquid fertilizer)❸ Gas yield
Many

Suitable for both Wet and Dry systems

LittleBetter suitable for Wet system※Investment amount per raw material is larger for Dry
system that it may be difficult as a business(may beresolved by mixing larger gas yield material, such as
paper waste）❼ Confirm economic efficiency→Select system

Yes

Suitable for Wet system(Also for Dry system)No

Suitable for Dry system(Wet system can be usedwith water processing)

Option to use sold residue(compost)

Yes
No

Favorable to both Wet and Dry systems
More suitable for Wet system（Dry system can beused with incineration facility)

Raw material

Main characteristics

Dairy cow manure● Free-stall barn : As feces and urine and small amount of bedding materials are mixed and discharged as slurry manure(over90% moisture) , it is suitable for wet methane fermentation material with higher moisture.
● Stall barn : At barn which separates feces and urine, semi solid manure (85-88% moisture) that feces and bedding materials
are mixed are discharged.

Beef cattle manure
Swine manure
Poultry manure● Normally, its moisture content is between 55%~70% and fermentation tank may be blocked as manure with more bedding

materials(sawdust and wheat straw) are more likely to be collected. Therefore, it is not suitable for Wet system. However, there
are some cases where Dry system are under consideration for usage.

● As urine amount is larger comparing to that of feces, for slotted floor type swine housing, manure is already slurry that it canbe used as a material for methane fermentation. However, you need to pay attention to its high nutrition concentration and its
nature will vary depending on the type of swine housing.

● Broiler : As its moister content is low as 20％〜30％ and it is discharged with bedding material, it is not suitable for methane

fermentation alone.

● Egg laying hens : Although gas yield is large, but amount of ammonia is also large that either dilute to 3-5 times or mix withother raw materials, if used alone.

● In general, it is easy to be decomposed and gas yield is large that it is suitable as raw material for methane fermentation.
● Materials not suitable for fermentation, are plastic, leather, stone, metal, fermentation inhibitor, drug, solvent, bones andGarbage/
Food residue

shells from crustacea, etc.,

Paper waste/
Pruned branch● Due to its large amount of gas yield, it is suitable for methane fermentation raw material for Dry system.
● To secure gas yield, there are some cases where paper waste is purchased with a fee.

Introduction requirements and technical guidelines on self-sustaining local biomass energy systems【Digest version】

08

Methane fermentation biomass section

11

Flow towards successful methane
fermentation biomass energy business

Methane fermentation business has many action points for implementation, from planning to operation stages. At this
NEDO’s introduction to the installation requirements・technical guidelines for implementation of biomass energy system,
various points to consider for each action point, as well as those details and various data are explained.
Overview of action items for methane fermentation biomass energy business
PhaseⅠConception
A. Business plan

Action items related to the complete edition(Chapter 1 of Complete Edition)
Action items related to
raw materials procurement(Chapter 2 of Complete Edition)

Action items related to equipment installation(Chapter 3 of Complete Edition)
Action items related to the use andtreatment of energy and by-products(Chapter 4 of Complete Edition)09

1.1.Ⅰ.A Building of a business concept
1.2.Ⅰ.A Business model outline study

Phase Ⅱ Feasibiity Study

Phase Ⅲ Design and Construction

1.3.Ⅱ.A Re-examination and confirmationof the business concept
1.4.Ⅱ.A Consideration of thecommercialization schedule

1.5.Ⅲ.A Review of future business plans
1.6.Ⅲ.A Formulation of a facility operation
management plan

1.10.Ⅱ.B Commercialization systemconstruction
1.11.Ⅱ.B Consensus-building with local
stakeholders

1.12.Ⅲ.B Finalization of commercialization
structure
1.13.Ⅲ.B Hiring of staffs
1.14.Ⅲ.B Conduct living environment
impact survey
1.15.Ⅲ.B Local consensus-building

1.16.Ⅳ.B Fostering of local
understanding

1.19.Ⅱ.C Calculation of construction cost・
O&M cost
1.20.Ⅱ.C Business's balance sheet,cashflow analysis
1.21.Ⅱ.C Confirmation of the subsidy system
1.22.Ⅱ.C Business's risk assessment(sort out the entire issues）
1.23.Ⅱ.C Consider to raise money for
initial investment cost

1.24.Ⅲ.C Application for equipment
assistance
1.25.Ⅲ.C Financing, negotiation withfinancial institutions

1.26.Ⅳ.C Verification and improvementof business profitability
1.27.Ⅳ.C Formulation of mid term
budget for maintenance fee
1.28.Ⅳ.C Securing funds for major
repair expected

B. Business structure・local cooperation
1.7.Ⅰ.B Consideration of businessstructure
1.8.Ⅰ.B Consulting with experts
1.9.Ⅰ.B Consulting with government

C. Business's balance sheet/financing
1.17.Ⅰ.C Review investment sizefor the facility
1.18.Ⅰ.C Obtaining a survey budget
for FS research

D. Ripple effects

2.1.Ⅰ Specifics of raw fuel type2.2.Ⅰ Confirming local availability of
raw material scale
2.3.Ⅰ Survey of resource amounts*Note: Blue text indicates introductory
requirements/technical guidelines.

1.29.Ⅱ.D Evaluation of the ripple effectby business2.4.Ⅱ Study how raw materials occur
2.5.Ⅱ Possibility of survey on raw material
collection
2.6.Ⅱ Investigation of the nature of raw
material
2.7.Ⅱ Investigation of the amount of gas
produced from the raw material
2.8.Ⅱ Investigation of alternative raw
material options

Phase Ⅳ Operation

1.30.Ⅳ.D Verification and disclosureof ripple effects

2.9.Ⅲ
2.10.Ⅲ

Finalizing raw material
Finalizing packing style andtransport vehicle

2.11.Ⅳ Confirmation of the nature of
raw material delivered
2.12.Ⅳ Confirmation of the amount of
raw material delivered

A. Installation of equipment

3.1.Ⅰ.A Selecting of methane
fermentation technology andconfirm reliability

3.2.Ⅱ.A Implementation of basic design
3.3.Ⅱ.A Element technology(fermentation/incidental technology)
3.4.Ⅱ.A Create flowsheet/layout sheet/specification
3.5.Ⅱ.A Study how to order equipment・
construction works
3.6.Ⅱ.A Quotations for each facility andcalculate overall cost

3.7.Ⅲ.A
3.8.Ⅲ.A
3.9.Ⅲ.A
3.10.Ⅲ.A
3.11.Ⅲ.A
3.12.Ⅲ.A
3.13.Ⅲ.A
3.14.Ⅲ.A
3.15.Ⅲ.A
3.16.Ⅲ.A
3.17.Ⅲ.A
3.18.Ⅲ.A

B. Compliance with laws and regulations

3.24.Ⅱ.B Confirmation and response to laws
and regulations as related toequipment installation

C.Location selection
3.26.Ⅰ.C Site Assumption

Selection of construction company
Implementation design
Arranging equipments
Construction agreement
Manage construction andimplementation work progress
O＆M contracting
Insurance contracting
Securing sewege related facilities
Formulation of test run/plan
Confirmation of performanceafter test run
Confirmation of performance
guanratee items
Confirmation of the handoverof the facility

3.19.Ⅳ.A Operation managementof the plant
3.20.Ⅳ.A System/equipment performance
evaluation and improvement
3.21.Ⅳ.A Verification and improvementof the facility utilization rate
3.22.Ⅳ.A Troubleshooting
3.23.Ⅳ.A Understanding methane
fermenter operation

3.25.Ⅲ.B Acquisition of permits and notifications
for business implementation

3.27.Ⅱ.C Location survey and study
where to set up

A. Provision and energy use of supply
4.1.Ⅰ.A Assumption of energy use
and energy supply

4.2.Ⅱ.A Specifics of the energy supply
form and amount
4.3.Ⅱ.A Survey of energy demand

4.4.Ⅲ.A Energy supply contracting

4.7.Ⅱ.B Grid interconnection survey

4.8.Ⅲ.B FIT business application
4.9.Ⅲ.B Connection contracting,power sale contracting

4.11.Ⅱ.C Consider details on
how to process and utilize
residues after digestion
4.12.Ⅱ.C Invetigate how to utilize
liquid fertilizer
4.13.Ⅱ.C Water process survey(release standard）

4.14.Ⅲ.C Survey on how to utilize liquid
fertilizer for digestive liquid

B.System connection
4.6.Ⅰ.B Grid interconnection survey

C. By-product treatment/use
4.10.Ⅰ.C Examination of digestive
liquid process and utilization

Introduction requirements and technical guidelines on self-sustaining local biomass energy systems【Digest version】

4.5.Ⅳ.A Maintenance plan forthe power generator andverification of its operation

4.15.Ⅳ.C Performance of water
processing facility
confirmation
4.16.Ⅳ.C Examination and adjustment
for the effective use of
by-products

Methane fermentation biomass section

12

Checklist towards sustainable business【methane fermentation】

In the introduction requirements/technical guidelines, based on the analytical findings of previoius cases, a checklist is
created as follows to summarize all the points for consideration, which also includes specific details of each item and whatkinds of special efforts will be required at feasibility study and demonstration projects.
■ Checklist for methane fermentation biomass energy business（Excerpt from the Conceptual Section）
Division

Action items

Corresponding items inPart 2 of this volume

Notes

Check

Is the purpose of business organized? Also, can you share such purpose with stakeholders?
Are the plan and size of the business heavily depend on the technology and equipments
to be installed?

Building of a businessconcept

1.1.Ⅰ.A

Do grants and subsidies precede the decision on the purpose and necessity ofthe business?
Is your plan subject to the objections from local parties involved?
Is your plan subject to the problem from social perspective?

Business model outline
study

1.2.Ⅰ.A

Have you assumed implementers and bases involved in raw materials procurement,
energy conversion and the energy use?
Can you make a clear target on profit structure and profitability(e.g., reduce processing fee,selling electric power, heat and liquid fertilizer, etc., )Is it a business that requires a special license, and is such a license expected to beacquired(e.g., related to Wastes Disposal and Public Cleansing Act, special application fordevelopment, etc.,) ? If so, are you prepared to get such licenses?

Overall

Does your plan clearly define who the main operating body is, not just having a big vision
without business itself?
Can you clearly imagine a main operating body which have sufficient abilities to manage
funds as well as execute the business?

Procurement of raw
materials

Developing businessstructure

1.7.Ⅰ.B

Consulting with experts

1.8.Ⅰ.B

Consulting with local
governments

Have you consulted with and received advice from experts, specialized agencies, andsupport organizations, etc., regarding the implementation of the business concept?

1.9.Ⅰ.B

Have you consulted with or provided information to the local governments regarding
the business concept? Is it possible to obtain the cooperation of such governments?

Confirming investment
size for the facility

1.17.Ⅰ.C

Secure budget for
FS study

1.18.Ⅰ.C

Listing up of raw material
options

2.1.Ⅰ

Confirming local
availability of
raw material andprocurement

2.2.Ⅰ

Do you have a key person who can mainly handle all the necessary procedures toimplement the business and also have sufficient supporting system?

Do you clearly understand the entire investment size generally required for overall dry andwet methane fermentation business?
Do you have a clear image on overall construction cost and total size of investment for
the entire system, not only for each facility alone?

Can you make a clear target on profit structure and profitability(e.g., reduce processing fee,selling electric power, heat and liquid fertilizer, etc., )Equipment installation

Survey of where to obtain
raw materials from

2.3.Ⅰ

Selection of methane
fermentation technology
and confirm reliability

3.1.Ⅰ.A

Is it possible to secure an FS budget that includes the utilization of the list for national
supplementation?
Is it possible to establish implementation structure required for FS study including reliable
and skilled experts and special agencies?
Can you clearly understand the merits and demerits of raw material required for methane
fermentation?
Have you confirmed the types of raw materials? Can you also confirm whether they are
either valuable resources or wasted materials?
Raw materials required for your business, can be procured in the local area in a stable andcontinuous manner?
Do you calculate the volume of the raw material required only from the power generation capacity?
Or do you also calculate such volume by putting higher priority on income expected?
Have you examined where the raw material is produced, its amount of generation andits main characteristics?
The equipments and technology under consideration, have proven track record oncommercial bases, not only on demonstration project base?
Do you have clear understanding on the technical characteristics and raw materials
required for both wet and dry methane fermentation systems？

Do you have clear understanding on exact import route, if it has to be purchased from abroad?
Did you confirm that there is no problem with the topography or geology? (It would be good if
the existence of past disasters, the possibility of disaster hazards, whether there is sufficientearth-bearing capacity, past land use could be confirmed and also what is the usage situation
based on the City Planning Act or even relationship with the local residents）

Site assumption

3.26.Ⅰ.C

Can you envision a plan that takes into consideration on the usage of the surrounding land
including other points, such as area to procure raw material, its surrounding environment,
access to the main road, water, electricity and infrastructure such as communications?
Have you checked the land classification of the target options, as well as whether it is necessary
to obtain any permissions for actual usage(e.g., area classification, usage classification) ?

Use and treatmentof energy andby-products

Assumption of where touse and how to
supply energy

4.1.Ⅰ.A

Grid connection review

4.6.Ⅰ.B

Consideration of process andutilization of digestive liquid

4.10.Ⅰ.C

Can you assume where the electricity and heat will be supplied to?
Have you considered the size of the heat medium required (e.g., hot water or steam, etc., )on the demand side?
Is the target region an area where the capacity of local power systems is tight?
Have you already contacted electric power company for grid connection?
Do you have clear image on how to process and use digestive fluid? (Either release into
water or use as liquid fertilizer after water processing)

Introduction requirements and technical guidelines on self-sustaining local biomass energy systems【Digest version】

10

Overview Section

13

Demonstration Project for Self-sustaining
Local Biomass Energy Systems

Biomass energy is expected to continue to become widely used as an important driver (‘gear’) that activates an entire
local system from the three perspectives of economy, society, and the environment. In order to realize a sustainablebiomass energy business and to promote the wider application of technology, it is necessary to use heat efficiently andto create an optimal system that takes advantage of local characteristics.
The New Energy and Industrial Technology Development Organization (NEDO) has launched and is now carrying out
its " Demonstration Project for Self-sustaining Local Biomass Energy Systems " in FY2014 so as to build an optimal
biomass energy utilization system that takes advantage of local characteristics. In this project, a feasibility study as alocal self-sustaining system, a demonstration project, and a technology development project were set as action items,
keeping in mind that renewable energy Feed-in Tariff systems (FITs) or subsidies are not relied on. These results arereflected in the introduction requirements and technical guidelines, and these results are disclosed every year.
Overview of societal goals of the Demonstration Project for Self-sustaining Local Biomass Energy Systems

Biomass energy to foster
local symbiosis

Local system

Environment

Society
Biomass
energy system

EconomyEnvironment

Society

EconomySocial system

Four frameworks for
improvements to ensurebiomass energy systems
self sustaiable economicallyand functionally
1 Material procurement
2 Energy conversion
3 Energy use
4 Overall system(in tandem with local community)

Action items for Demonstration Project for Self-sustaining Local Biomass Energy Systems❶ The requirements for local sustainability from an economic standpoint and the elemental
technologies for each type of biomass fuel (unused wood, livestock waste, municipal waste, etc.)
will be reviewed, and the introduction requirements and technical guidelines for such will besummarized.
❷ Feasibility studies for demonstration projects will be conducted.
❸ For businesses that are likely to be profitable, model verification that matches the requirements
and technical guidelines for introduction will be performed, and technologies where improvement
can be achieved will be developed.
❹ Together with the introduction requirements and technical guidelines that reflect the results ofdevelopment and demonstration, a business model will be published, and contribution towardfurthering introduction promotion will be made.

11

Introduction requirements and technical guidelines on self-sustaining local biomass energy systems【Digest version】

Published in June 2020
New Energy Department,
New Energy and Industrial Technology Development Organization (NEDO)
Muza Kawasaki Central Tower 1310 Omiya-cho, Saiwai-ku, Kawasaki-shi,
Kanagawa Prefecture, Japan 212-8554
TEL: 044-520-5271
Editorial cooperation: Mizuho Information & Research Institute, Inc. Global
Innovation & Energy Department
Materials provided by: Fuji Clean Co., Ltd., Shikaoi Town