The green economy in times of crisis
In order to cope with climate change, health emergencies and geopolitical instability, Europe has long relied on strategies aimed at sustainability. The BRANCHES project funded by the Horizon 2020 programme has collected a large number of virtuous examples of circular bio-economy in agriculture. These models show a remarkable capacity to withstand the adversities of our times and bode well for the future
mong the various EU-funded initiatives to combat climate change, the H2020 project 'BRANCHES' - Boosing RurAl Bioeconomy Networks following multi-actors approaCHES (www.branchesproject.eu) - for which ITABIA is the main communication manager, is giving great satisfaction in terms of tangible results.
To date, several dozen good practices (Practice Abstracts) have been selected within the framework of this project, all of which refer to the sphere of the bio-economy with a particular focus on the smart usage of biomass derived from the primary sector. These are interesting examples which reveal - in addition to innovative technological aspects - also a marked entrepreneurial or experimental capacity of the protagonists described in them. In order to make the information campaign more effective, concise and comprehensive, some descriptive sheets were produced on these case studies, all of which can be downloaded from the project website both in English and in the language of the country in question. From this work, an original initiative designed around the complex contingent crisis situation got underway. Thus, stakeholders involved in the various selected good practices were contacted to hear how the COVID 19 pandemic and the war in Ukraine had affected their respective business activities. In a nutshell, the questions were asked with the intention of assessing, on the one hand, the role of renewables (especially bioenergy) in mitigating the effects of the energy crisis and, on the other hand, the obstacles and opportunities that this crisis has created in the bioeconomy and bioenergy sector. Consequently, the main negative and positive impacts of the energy price increase emerge from the interviews. These can be traced back both to a general increase in the day-to-day running costs of companies and to an increasing benefits of using biomass in terms of savings, autonomy (local availability) and land management.
The end result of this effort will be the drafting of a Strategic Orientation Report entitled 'Bioenergy in a time of crisis' with which to show policy-makers the strengths and weaknesses of the bio-economy, an innovative and expanding sector, in the face of unpredictable dynamics that are difficult to control. To give an idea of the slant given to the aforementioned interviews, we report the one given by Marcello Piccinni, director of the Fiusis company, a 1 MW thermoelectric power plant that is fuelled solely by prunings from olive groves in the Salento region of Apulia. This entity is a model of circular economy linked to the agricultural context which - for its praiseworthy technological and organisational solutions - will be the subject next April of one of the 5 showcase days planned in Europe by the BRANCHES Project (See Box).
According to Piccinni's business experience, over the past three years, pandemics and war have led to a significant increase in the prices of raw materials and energy, creating quite a few economic difficulties for Fiusis. These, fortunately, were overcome thanks to the ability to bring innovation to the company's production lines (energy and pellets).
Regarding the production of electricity - the company's core business - it must be said that the Conto Energia contract with the Gestore dei Servizi Energetici (GSE) locks in the purchase price of energy at EUR 0.28 per kWh. Thus, despite inflation and the sharp rise in the costs of all raw materials, the value of the kWh cannot increase and therefore profit margins have shrunk considerably. This contraction of company profits is evident in connection with the following:
• the energy consumption incidental to the operation of the thermal power plant has quadrupled. In 2019, the annual bill was around EUR 13,000 and in 2022 it was close to EUR 50,000;
• the costs for the purchase of spare parts, lubricants and fuels for the machines (tractors, chippers, excavators, etc.) used in biomass handling also rose sharply. Diesel rose from 1.45 €/l to 2.20 €/l (average increase of about 0.40 €); lubricants from 0.12 €/kg to 1.2 €/kg (increase of 1,000 %); ammonia from 0.18 €/l to 1.2 €/l (increase of 670%);
• plastic film (recycled and recyclable) imported from Germany to bag pellets rose from €0.12 per sack to €0.32 per sack (270% increase).
In this scenario, energy production has suffered a drastic drop in profitability, fortunately offset by the production of pellets, whose process is made particularly efficient for the following reasons:
• they source raw materials locally and target the local market. This results in considerable savings on transport and distribution costs;
• all the process heat needed to produce the pellets is obtained at zero cost, because it is recovered from the thermal waste of the biomass power plant;
• 25% of the electricity consumption incurred in the pelletising process is met by the recently installed solar panels. In the coming years, Fiusis plans to install an additional 250 kW of photovoltaics to cover all the needs of the plant.
For these reasons, Fiusis can afford to keep the price of pellets at €8 per bag (15 kg), well below a national average of €12 to €16 per bag. Today, as a result of these choices, demand for Fiusis pellets has increased by 2,000% and production has risen rapidly from 600 t/year marketed in 2020 to 1,500 t in 2021. The plan is to further expand capacity to 6,000 t/year in the short term.
In conclusion, Fiusis's policy based on local resources, technological innovation, energy cogeneration (electric and thermal) and the integration of renewable sources (biomass and solar) has ensured great resilience and vitality in a period of severe crisis for many companies with little inclination to innovate.
The Fiusis company
In southern Apulia, olive groves cover about 400,000 hectares and produce excellent olive oil, which is exported throughout Italy and abroad. It is estimated that over 800,000 t of woody biomass are obtained annually from the pruning of Apulian olive groves. The problem of managing such a large amount of waste has been turned into a business opportunity by a virtuous company. Fiusis is a 1 MWe biomass cogeneration plant, which annually uses about 10,000 t of olive prunings to obtain about 8 million kWh of electrical and thermal energy. The company also has a wood pellet production line that uses surplus thermal waste for drying sawdust and produces about 1 tonne per day of high-quality pellets. Fiusis not only benefits the local economy with 33 specialised employees, but also offers environmental advantages by avoiding the net emission of 4,500 t CO2 per year compared to an equivalent plant fuelled by natural gas (it is the best alternative). For all these reasons, the plant was selected as an Italian good practice model of circular bioeconomy candidate for the European BRANCHES Project Award for its sustainability and wide replicability in many other settings. To share and disseminate the experience gained, the Fiusis company - in collaboration with ITABIA, CNR IBE - will open its gates to describe and show the supply chain and energy conversion of the Calimera (LE) plant.