* Albioma to invest 200 mln euros in 22 biogas plants
* New regulation creates huge market in France
* Firm buys first Brazil bagasse-fired cogeneration plant
By Geert De Clercq
PARIS, March 5 (Reuters) - French biomass group Albioma has launched its first two biogas plants as part of an investment drive to benefit from changing regulation in France, its CEO said on Wednesday.
The company specialises in generating electricity from sugarcane waste in France’s overseas territories. It has opened two biogas plants in the region around Poitiers in 2013 and plans to open three or four more this year, of which one will inject purefied methane into the French gas network.
Albioma has a pipeline of 22 methanisation plants, in which it will invest about 200 million euros in coming years. The plants will use manure, agriculture waste and slaughterhouse waste and will be built in France’s western and northwestern agricultural regions. The first two plants have capacities of 2 and 0.5 megawatt respectively.
With a combined biogas capacity of about 30 megawatts, France is way behind Germany, which has some 3000 megawatts of biogas capacity in the agricultural sector, Albioma chief excecutive Jacques Petry told Reuters.
“It is a major competitive disadvantage for French farmers. German pig farmers already get 10 to 15 percent of their revenue from anaerobic digestion,” Petry said after Albioma released 2013 earnings.
The firm’s 2013 net profit rose 33 percent to 43 million euros as revenue rose two percent to 364 euros. Its shares rose 12 percent on Wednesday in the busiest trade since October.
Petry said the French biogas market was benefiting from two regulatory changes: the obligation for gas giant GDF to accept purefied biomethane for injection in its networks and tighter environmental laws forcing farmers to treat manure.
“The French biogas market is huge. The issue is not competition, but delivery,” Petry said.
Biogas, essentially methane, is the result of the anaerobic (oxygen-free) digestion of organic material. Besides farming and agribusiness, biogas is also produced from waste water sludge and landfills, mainly by environmental services firms like Veolia and Suez Environnement.
Power firms EDF and GDF have also set up methanisation units and smallcap Methanor is focusing on the agricultural market, like Albioma, which had a market capitalisation of 538 million euros at Tuesday’s close.
“The biogas market in France is rising from the ground now. In a few years we’ll see who the main players are,” Petry said.
Albioma has installed power capacity of 700 megawatt (as much as a small nuclear plant) of which 627 MW biomass, 70 MW solar and 3 MW biogas. By 2017, Albioma’s biogas capacity should grow more than tenfold to around 40 MW, a company slide showed.
More than half of Albioma’s capacity is based in French overseas territories like the islands of Martinique and Guadaloupe. It has another 195 MW in Mauritius and 60 MW in Brazil, where it just bought a 60 MW sugarcane-based biomass plant for 43 million euros.
Albioma wants to invest in one new Brazilian biomass plant every 12 to 18 months, Petry said.
The company confirmed plans, announced last year, to invest one billion euros over the next decade, of which 400 million in French overseas territories, 400 million in Brazil and 200 million in biogas plants in France.
Sixty to seventy percent of the money will come from project finance, the rest from Albioma and the sugarcane factories that take minority equity stakes. No new equity will be raised. (Editing by William Hardy)