|December 13, 2009|
French Waste-to-Energy Market Report
|The French Waste-to-Energy (WTE) market is a mature, developed
market, which experienced rapid growth in the early 2000s due to
new construction, upgrades and refurbishing of large plants. The
market, valued at approximately USD 150 million, is expected to
grow at a more tempered pace over the next 5-10 years with a focus
on small and medium-sized plants in less densely populated regions.
The WTE industry treats over 12 million tons of municipal solid
waste (MSW) and related waste annually and generates more than
10,000 GWh of energy per annum.|
The Grenelle Act, France's overarching vision for environmental policy, in addition to current EU environmental legislation and directives, is expected to drive this market in the near term. While the market is highly concentrated and dominated by French industry, some niche opportunities may exist. These include energy efficiency, NOx reduction and treatment, ISO 14001 and EMAS certification and technology for small cost-effective waste-to-energy plants and heat transfer and transportation.
Over the past few years the market has slowed considerably due to the increased costs to build WTE plants, the strong presence of low-cost nuclear energy and an incomplete waste management policy. Currently, landfilling with pre-treatment has become a temporary solution until the WTE policy can be clarified, which has put the market at a standstill. Furthermore, government policy is driving the market towards waste reduction, waste reutilization, recycling and composting and away from incineration and landfill. The French Pollution Tax (TGAP - Taxe Générale sur les Activités Polluantes) for incineration has made incineration and landfilling at least as costly as alternative waste treatment approaches.
At the same time the TGAP has created incentives for more flexible WTE cogeneration plants (electricity and heat) via tax deductions per ton of waste treated. Consequently, according to industry officials, WTE generation from incineration could double by the year 2020 without increasing the amount of waste treated. In addition, the national renewable energy plan, which includes WTE incinerators, will provide up to 60% financing for investment for grid hookup and additional financing for thermal energy production for 5 years. This taken together should stimulate the market in the medium- to long-term.
Three major WTE incineration plant construction contracts have recently been awarded, which include the Clermont-Ferrand site for 300,000 tons of waste per year; the Saint-Thomé site for 100,000 tons per year; and the Marseille site for 150,000 tons per year. Given that contracts and construction for most of the large WTE plants have been completed, market demand is expected to come from the small to mid-sized plants (80,000-100,000 tons per year).
The overall market for solid waste management in France, which includes WTE incineration, is valued at approximately 5 billion euros and treats over 47.5 million tons of waste per year. There are approximately 120 WTE plants that treat over 12 million tons of MSW and related waste annually and generate more than 10,000 GWh of energy per annum.
The market for WTE plant construction can vary widely from year-to-year due to the long sales cycle and high capital investment costs, but is valued at approximately 150 million euros. Future orders are expected to increase the market size in the next couple of years.
Over the past several years industry has focused on supplying the large WTE incineration plant market. However, the need to treat waste in smaller cities and less densely populated communities in France has driven demand for small to medium-sized WTE incineration plants (80,000 to 100,000 tons of waste per annum).4 Government policy is also creating opportunities for the market. Policies have placed greater emphasis on waste reduction, reutilization and recycling, which should reduce the amount of waste available for incineration. In addition, the French Pollution Tax for Incineration (TGAP) and the National Renewable Energy Plan have created incentives for incineration plant operators to increase energy output. This includes thermal energy production and electricity generation.
Therefore, services, processes and technologies in energy efficiency for increased energy production and heat transportation are expected to be in big demand in the near future. Moreover, these TGAP tax incentives are also increasing demand for ISO 14001 and EMAS certification as well as cost-effective NOx reduction and treatment technologies. The emphasis on small to mid-sized plants will also create some technical challenges, given minimum economies of scale required to produce energy efficiently. One of the major problems has been the malfunctioning of the turbo alternator due to lower quantities of waste and hence, steam. Therefore, turbo alternators designed and built to operate efficiently with smaller quantities of steam will also be in big demand
Hence end-users, suppliers and subcontractors may compete,
collaborate and form joint-ventures depending on the project.
Consequently, companies interested in entering this market will
have to have a flexible business model that enable them to compete
with, supply to and purchase from other firms present in the
market. Moreover, given that the majority of the companies are
French, a strong French culture is present in business transactions
and market development activities.
Extracts from: French Waste-to-Energy Market, US Commercial ServiceSource: buyusainfo.net