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Reporting period: 2014-10-01 to 2015-03-31

Ludan Renewable Energy S.L. (LRE) is an engineering company with extensive experience in the business of biogas and treatment of bio-wastes. LRE main product is biogas compact plant, focus to small/medium energy projects (250-400 kW) where self-supply and waste management are the main targets. With BIOFERLUDAN project, LRE wants to take a step beyond responding new demands of cost-effective and reliable treatment for the digestate, the main by-product of these installations, developing an on-site recovery process to treat it obtaining high quality humic fertilizers.

BIOFERLUDAN aims to implement in biogas plants a new process to obtain liquid fertilizers with high organic matter content, in form of humic substances, recovering these substances from the digestate. Based on previous R&D works done by LRE, a biogas plant which use BIOFERLUDAN process will produce a minimum of 60L of fertilizer per ton of digestate. The implementation of the new solution will mean around 450.000 €/year of potential incomes for each plant.

The BIOFERLUDAN-process (see Image 1) is defined as a new digestate treatment based on:
1. Chemical extraction of organic matter (focusing on humic-like substances) from Anaerobic Digestion digestate: with an alkaline solvent at high temperature.
2. Separation of liquid extract and insoluble organic phase: Conventional dewatering system modified with specific chemical pre-treatment performs this separation achieving maximum concentration of solids.
3. Concentration of the liquor to obtain the liquid organic fertilizer: Membrane filtration and vacuum evaporation techniques complete this step using heat and power surplus from the biogas plant.

There is no so competitive solution in the market and main European biogas installations constructers and installers do not offer any process to obtain organic and humic fertilizers through digestate treatment.

The objectives of this BIOFERLUDAN Feasibility Study, as phase 1 of SME Instrument EC project, are:
• To secure IPR and ensure free BIOFERLUDAN operation.
• To detail primary (Biogas plant) and secondary (fertilizers obtained from digestate) markets.
• To specify commercialization channels and commercialization scenarios.
• To quantify the business plan and financial/exploitation figures.
The different activities performed at BIOFERLUDAN project (SME Instrument - phase 1) can be grouped in four tasks:

1. Analysis of the intellectual property rights (IPR) and the freedom to operate (FTO)
2. Identification of the structure and segments of the targeted market
3. Identification of commercial channels for BIOFERLUDAN fertilizers
4. Detail of the exploitation/financial plan

Main results obtained after the completion of these tasks were:

+ There is total freedom to develop the plant in Spain and the rest of Europe, except perhaps Germany, that would need a more thorough analysis. BIOFERLUDAN invention is novel and has a clear industrial application. Moreover, since it has not made public the invention, the company (Ludan Renewable Energy S.L.) aims to protect the process by means of patent application procedures.
+ Biogas plants markets with more potential to implement BIOFERLUDAN process are segmented in those with co-digestion or organic waste in terms of type of feedstock. Second segmentation can be done respect current digestate use and future perspectives. Strict quality control of materials used as feedstock will be the first and most important step of digestate quality management that will be revised and controlled in targeted Biogas plants ensuring maximum ecological and economic benefits from use of digestate as organic/humic fertiliser.
+ New markets identified for solid digestate products beyond traditional composting are: home garden products, landscaping, horticulture (commercial nurseries and seedlings producers) and use on city parks and gardens. On the other hand, new markets selected for liquid digestate products beyond traditional agricultural spreading are horticulture, liquid plant feeds, turf fertilizers, algal culture and Biofuel production. In both cases (solid and liquid products) fertilizer production may require supplementing with Phosphor and Potassium due to nutrients content of digestate.
+ Regarding legislative requirements for the fertilizer products obtained by BIOFERLUDAN process will be classified as organic fertilizers and biostimulants with humic substances. Since these categories are not included on the inorganic fertilisers European Regulation (EC) No 2003/2003, most member states have in place national provisions regarding marketing of this kind of products.
+ At the fertilizer sector, main concern of all manufacturers is to comply with the legislation and for the specific product obtained from digestate; it should have good adaptation to the use. In addition, main market barriers are the distribution having a good commercial network of sales and sales channel; and the extensive timing of a proper agronomic validation of the product.
+ For the Biogas sector, economic barriers were remarked because scale economy and final prices of fertilizers are key aspects to be able to monetize the implementation of more comprehensive treatments of digestate.
+ Market of humic fertilizers presents a great variety both in composition and forms of presentation adapted to the different needs and requirements of the soils (around 200 references only in Spain). Despite this, due to the growing market the products which are going to be developed in BIOFERLUDAN project, will present perfect conditions to have a niche on both the domestic and international markets.
+ For the commercialization of fertilizers, performed analysis of both typical/alternative commercial channels and currently company experience/capacities indicate that B2B scheme is the best structure of commercialization route. Consequently the suitable commercial channel for BIOFERLUDAN fertilizer would be the fertilizer producers with similar products and with high distribution capacities able to deliver the products to different identified consumers (Farms, cooperatives and agricultural companies, gardening shops, supermarkets, etc.).
+ After the economic study of the fertilizer
The feasibility study completed shows that it is a need to request a Phase II for this project, because there is potential to be made for the company Ludan Renewable Energy S.L. (LRE), as EPC provider of services and owner of fertilizer plants, and for external biogas plants operators to generate new incomes for their installation or, at least, reduce the cost of the digestates management.

Consequently, different final results were identified within the existing framework of BIOFERLUDAN project Phase 1 and after the expected Phases 2 and 3.

+ During the fourth quarter of the year 2015 it will be completed a national patent application at the Spanish Patent and Trademark Office. It is expected that this action will be included and financed by SME-Instrument Phase II of the BIOFERLUDAN project.
+ Once the demonstration of BIOFERLUDAN process in a pilot plant would be completed successfully during year 2016, it will be continued with the IPR protection actions through a European Patent application which designates the entire territory of the EU.
+ After satisfactory completion of Phase II, patent application may be converted into a European patent designating one or more Member States. Among candidate states will be Spain, France, Netherlands, Germany, UK, and Italy; since these countries are previously identified as relevant in both Biogas and organic/humic fertilizer markets.
+ Once the technology of production of high added value fertilizers is established, it will be offered to different biogas plants in operation in Spain and Europe with special focus on company partners in Netherlands, UK, France and Italy.
+ A process to achieve agreements to direct selling the BIOFERLUDAN products as raw material for fertilizer production will start after pilot test to be performed in 2016.
+ Through implementation of two business models obtained for BIOFERLUDAN feasibility study it is expected to achieve the following revenues:
• Installation of new fertilizer plants for external clients (biogas plant not owned by LRE). An interesting business could be created with these installations, reaching in 5 year a turnover up to 11 million euro.
• Construction of fertilizer plants for third parties. Based on the profitability of the project, it has been organized a plan to build 15 plants in The Netherlands, Spain, UK, France and Italy, during a period of 5 years, mobilizing an investment up to 26 million euro in the next 5 years and treating up to 450.000 tons of digestate
Scheme of BIOFERLUDAN process installation in a biogas plant