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Business Plan of Small-Scale Biofuel Plant in the Region of Attica, Greece

Technical Report · January 2019

DOI: 10.13140/RG.2.2.35032.55049

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 UNIVERSITY OF PIRAEUS

DEPARTMENT OF INTERNATIONAL AND EUROPEAN STUDIES

MSc in Energy: Strategy, Law and Economics

STEFANOS BOMPOLAKIS
DAFNI GIANNOULI
AGIS KOUMENTAKOS
DESPOINA LAZOPOULOU

PIRAEUS 2018
I. EXECUTIVE SUMMARY ...................................................................................................................... 4

MISSION STATEMENT ......................................................................................................................................... 4

BASIC DEFINITIONS ............................................................................................................................................ 4
Biofuels ......................................................................................................................................................... 4
Biodiesel ....................................................................................................................................................... 5
KEYS TO SUCCESS............................................................................................................................................. 5

II. DESCRIPTION OF THE BUSINESS ................................................................................................... 6

LOCATION ........................................................................................................................................................... 6
LEGAL STRUCTURE ............................................................................................................................................ 9
Incorporation of EU law in Greek national legislation .......................................................................... 11
Urban Law – Building Permit ................................................................................................................... 11
TAXATION ......................................................................................................................................................... 12
Green Taxation .......................................................................................................................................... 13
ORGANIZATIONAL CHART................................................................................................................................. 16
Staffing Requirements .............................................................................................................................. 16

III. PRODUCTION ................................................................................................................................ 16

FACILITIES NEEDED ......................................................................................................................................... 16

ADVANTAGES AND DISADVANTAGES OF OPEN PONDS..................................................................................... 17
SOLUTIONS TO THE DISADVANTAGES .............................................................................................................. 17
PRODUCTION PROCESS ................................................................................................................................... 18
Microalgae Selection ................................................................................................................................ 18
Microalgae Cultivation .............................................................................................................................. 18
Harvesting .................................................................................................................................................. 18
Drying - Oil Extraction ............................................................................................................................... 19
Transesterification ..................................................................................................................................... 19
Storage & delivery ..................................................................................................................................... 20
EQUIPMENT AND MACHINERY NEEDED ........................................................................................................... 20
Baffles ......................................................................................................................................................... 20
Paddlewheel............................................................................................................................................... 21
Gas diffusers .............................................................................................................................................. 21
OUTPUT LIMITATIONS....................................................................................................................................... 21
Dissolved oxygen ...................................................................................................................................... 21
Contamination ............................................................................................................................................ 22
Evaporation ................................................................................................................................................ 22
ENGINEERING AND DESIGN SUPPORT ............................................................................................................. 23
Filtration ...................................................................................................................................................... 23
Chemical Oil Extraction ............................................................................................................................ 24

IV. MARKET AND COMPETITORS ................................................................................................... 25

DESCRIPTION OF CUSTOMERS ........................................................................................................................ 25

CUSTOMER NEEDS AND BENEFITS .................................................................................................................. 25
CUSTOMER DECISION CRITERIA ...................................................................................................................... 25
MARKET ANALYSIS ........................................................................................................................................... 25
COMPETITION ................................................................................................................................................... 25
SWOT ANALYSIS ............................................................................................................................................. 26

V. BUSINESS STRATEGY ..................................................................................................................... 26

2
 ECONOMIC, POLITICAL, LEGAL FACTORS THAT AFFECT THE STRATEGY ....................................................... 26

VI. FORECASTS AND FINANCIAL DATA ........................................................................................ 26

PERFORMANCE AND SALES FORECASTS ......................................................................................................... 26

PROFIT AND LOSS ACCOUNTS ......................................................................................................................... 27
CASH FLOW FORECASTS ................................................................................................................................. 28
SENSITIVITY ANALYSIS ..................................................................................................................................... 29
Low scenario .............................................................................................................................................. 30
By-product scenario .................................................................................................................................. 30
Higher productivity scenario .................................................................................................................... 32
Lower production costs ............................................................................................................................ 33

VII. FINANCING REQUIREMENTS ..................................................................................................... 34

FUNDS REQUIRED AND TIMING ........................................................................................................................ 34

BIBLIOGRAPHY ......................................................................................................................................... 36

3
 I. Executive Summary

Mission Statement
The main objective of the company is to offer to its customers, high-quality biofuel products made
exclusively from algae strains. Through these eco-friendly products, it is also aimed to contribute to
the transition to renewable energy in Greece, as well as to the reduction in the use of conventional
energy sources and thus to decreasing carbon dioxide emissions.

Basic Definitions
Biofuels
Biofuels are liquid or gaseous transport fuels, which are produced from biomass, as defined by
Directive 2009/28/EC. They are produced through contemporary biological processes, such as
agriculture and anaerobic digestion. They can be derived directly from plants (i.e. energy crops), or
indirectly from agricultural, commercial, domestic, and/or industrial wastes.

They serve as a renewable alternative to fossil fuels in the EU's transport sector, helping to reduce
greenhouse gas emissions and improve the EU's security of supply. Biofuels are in theory carbon-
neutral because the carbon dioxide that is absorbed by the plants is equal to the carbon dioxide that
is released when the fuel is burned.

By 2020, the EU aims to have 10% of the transport fuel of every EU country come from renewable
sources such as biofuels. Fuel suppliers are also required to reduce the greenhouse gas intensity of
the EU fuel mix by 6% by 2020 in comparison to 2010.

First-generation biofuels

"First-generation" or conventional biofuels are made from food crops grown on arable land. The sugar,
starch, or vegetable oil obtained from the crops is converted into biodiesel or ethanol, using
transesterification, or yeast fermentation.

Banning of first-generation biofuels. In the EU, the revised renewable energy directive calls for a
complete ban on first-generation biofuels by 2030. Particularly fuels made from such oils such as palm
oil and soy oil are being targeted.

Second-generation biofuels

Second generation biofuels are manufactured from various types of biomass. Biomass is a wide-
ranging term meaning any source of organic carbon that is renewed rapidly as part of the carbon cycle.
Biomass is derived from plant materials, but can also include animal materials.

Third-generation biofuels

Algaculture and Algae fuel: From 1978 to 1996, the US NREL experimented with using algae as a
biofuels source. For the realistic replacement of all vehicular fuel with biofuels by using algae that

4
have a natural oil content greater than 50%, which can be grown on algae ponds at wastewater
treatment plants. Algaculture – unlike crop-based biofuels – does not entail a decrease in food
production, since it requires neither farmland nor fresh water.

Fourth-generation biofuels

Similarly, to third-generation biofuels, fourth-generation biofuels are made using non-arable land.
However, unlike third-generation biofuels, they do not require the destruction of biomass. This class
of biofuels includes electrofuels and photobiological solar fuels. Some of these fuels are carbon-
neutral.

Biodiesel
Biodiesel (oil of biological origin) is the methyl esters of fatty acids (MLO - FAME) produced from
vegetable oils, animal fats, various energy crops, algae, and a variety of recycled oils and is used as
biofuel in transportation.

Biodiesel has found great acceptance in Europe and can be used as a fuel for vehicles in its pure form
(B100), but it is usually used as a diesel additive to reduce levels of particulates, carbon monoxide, and
hydrocarbons from diesel-powered vehicles.

The world's largest biodiesel producer is the European Union, accounting for 53% of all biodiesel
production in 2010. As of 2011, mandates for blending biofuels exist in 31 countries at the national
level and in 29 states or provinces. The International Energy Agency has a goal for biofuels to meet
more than a quarter of world demand for transportation fuels by 2050 to reduce dependence on
petroleum and coal.

Keys to Success
Microalgae and cyanobacteria are constantly gaining ground as alternative sources of biomass for
biodiesel production. Biodiesel produced by microalgae is a third-generation1 biofuel which provides
more benefits as compared to the first and second generations, mostly due to its high lipid and
carbohydrate contents and the easy cultivation in a wide variety of water environment. It has also
superior combustion characteristics and lower emissions when compared to petrochemical diesel.
The cultivation of microalgae may occur in different culture media, without necessarily using potable
water intended for the irrigation of plantations or for human and animal consumption. It can also grow
in wastewater, salt water and brackish water which have different benefits for the algal colonies.

In addition, microalgae cultivation can occur in small areas and in non-arable or desert lands, since the
main factors that influence the development of microalgae are the availability of sunlight and water.
Their harvesting can be done in short time (even one day), which corresponds perfectly to the
increasing global biodiesel demand.

1
The term third-generation biofuel has only recently appeared, in an effort to distinguish the biofuels derived
from non-edible natural resources like algae from other types of non-food biomass. The common feature that
algae and second-generation feedstock share is that both cannot satisfy demand in the human food chain.
Although, algae are capable of much higher yields, and thus they were moved to their own category.

5
The production of biodiesel from microalgae is a feasible technological development, as they have
shown higher productivity than certain crops used for the production of first2 and second-generation
biodiesel. Moreover, microalgae and cyanobacteria can reach 50% of their dry weight in
carbohydrates, which can then be processed with high yields.

Regarding the comparison with other third generation biofuels (bioethanol, biogas, etc.), biodiesel
from algae offers more advantages as it requires a much less energy intensive process to be produced
and can be used directly in common diesel boilers and engines, after blending with petroleum diesel3.

II. Description of the Business

Location
The geographic location of a raceway-based production facility has the greatest impact on biomass
productivity. The climatic conditions of the chosen location should be such that a consistently high
biomass productivity is achieved throughout the year.

The main factors influencing productivity are the average annual irradiance level, the precipitation,
and the prevailing temperature. In climates similar to that of Greece, microalgae can achieve 10 times
higher production of biomass due to the high irradiation of sunlight all year long.

Ideally, the conditions should be as following:

- 4.65 kWh/m2 minimum daily solar irradiation (1680 kWh/m2 yearly)
- Rainfall not more than 1000 mm/year
- 20°C to 30°C temperature (25°C ideal condition)
- Between 16°C and 27°C water temperature
Other considerations are:
- The wind velocity
- The presence of dust and other pollutants in the atmosphere

As the local topography and geology are very important aspects of the algal cultivation, a variety of
rules should be considered for the selection of the proper site for the installation of the facilities.
Coastal areas can be considered appropriate locations due to their flat surface (the land slope should
be no more than 5%) and the availability of non-arable land, which is offered for microalgae
cultivation. Moreover, the availability of seawater which can be supplied to the algae strains (after
filtering) for additional nutrients is an important factor as microalgae grown in water with a higher
concentration of salts have high lipid productivity.
Apart from the above, another major condition is the access to wastewater and industrial waste which
can offer a variety of nutrients for the cultivation of algae at a minimum cost. Thus, the facilities may

2
First generation biofuels mostly derive from food stocks such as sugarcane and corn and thus can have negative
impacts on the food supplies and biodiversity if used in excess.
3
Biodiesel can be blended with petroleum diesel at any rate. The most common blend is the B5 (up to 5%
biodiesel). Other blends are the B20 (6% to 20% biodiesel) and the B100 (pure biodiesel) which is rarely used as
a transportation fuel.
6
be placed near an industrial zone, power plants or even cement plants that emit CO2 (1 ton of
produced algae requires 1.8 tons of CO2 for their growth).

Figure 1: Mean annual precipitation in Greece (mm) (European Commission)

Figure 2: Average annual temperature in Greece (European Commission)

7
 Figure 3: Yearly total irradiation in Greece (kWh/m2) (European Commission)

Considering the aforementioned prerequisites, the area chosen for the facilities of the company will
be in a seaside location in the suburbs of Athens, near major refineries, as well as in a close distance
to the municipality’s wastewater treatment plant. The waste from these facilities can be used as a
source of nutrients as mentioned above.

Figure 4: The area of 15.5 hectares (in dark gray) of the company's facilities in Athens
8
Legal Structure

Energy policy is one of the most hotly debated international issues today. For the European Union
(EU), the policies relating to renewable sources of energy, form part of a broader strategy directly
linked to the Scheme for Greenhouse Gas Emission Allowance. Several developed and developing
countries have established regulatory frameworks for biofuels, often including blending mandates of
biofuels with fossil fuels.

Countries have also provided different kinds of subsidies and incentives to support biofuel industries
such as blending regulations, tax incentives, government purchasing policies and other measures. In
general, national bioenergy policies have been developed and implemented within a broad political,
economic and environmental framework over the past few decades

By 2000, several member countries of the EU had introduced biofuels targets and blending mandates
so as to promote the growth of biofuels, driven by environmental and energy security concerns.

In the EU context, the European Commission has taken a leading role through its various directives,
guidelines and papers.

Directive 2003/30/EC: Biofuels and Transport.

As to policies concerning renewable fuels for transportation, the first major and coordinated political
act was the implementation of the 2003 European Directive (Directive 2003/30/EC) of the European
Parliament and of the Council, of 8th May 2003, on the promotion of the use of biofuels or other
renewable fuels for transport. The Directive established an indicative target of 2% share of biofuels in
road-transport’s overall fuel consumption by 2005, a 5.75% target to be achieved by 2010, and a
further one of at least 10% to be attained by 2020.

In 2005, biofuels were used in 17 of the EU Member States. In the first two years under the Directive
the consumption of biofuels doubled up, and the biofuels market-share experienced a significant
increase reaching, on average, 1%. Despite such a rising trend this percentile remained below the
reference value set at 2%, which was only achieved by Germany (3.8%) and Sweden (2.2%). Biodiesel
got a stake of about 1.6% of the diesel market, while ethanol only 0.4% of the oil market. Hence, and
relying upon several projections, in its Report of 10th January 2007 the EU Commission considered
unlikely that Member States will achieve the 5.75% target set by the Directive for 2010, for that reason
recommended that the Biofuels Directive be amended, particularly, by promoting high-quality
biofuels and setting a mandatory target for the EU as a whole of 10% for 2010. According to the EU
Commission Energy Statistics the final share of biofuels in transport fuels in 2005 was 0.9% and in 2010
3.7%.

RED I: Directive 2009/28/EC: Promotion of the use of energy from renewable sources

The 2003 Directive was followed by a more massive and ambitious political act, the 2009 Renewable
Energy Directive (RED), part of the CCP (the EU Energy and Climate Change Package). This Directive of

9
the European Parliament and of the Council, 23 April 2009, establishes a common framework for the
production and promotion of energy from renewable sources in order to limit greenhouse gas
emissions and to promote cleaner transport. More specifically, it sets ambitious targets for all Member
States, such that the EU will reach a 20% share of energy from renewable sources by 2020 and a 10%
share of renewable energy specifically in the transport sector.

In order to ensure the fulfillment of the targets, the Directive required the 28 member-states submit
their own National Renewable Energy Action Plans (NREAPs) by June 30, 2010, which will be providing
very detailed roadmaps of how each member state expects to reach its legally binding 2020 target.

Directive (EU) 2015/1513 of the European Parliament and of the Council of 9 September 2015

This directive amends Directive 98/70/EC relating to the quality of petrol and diesel fuels and
amending Directive 2009/28/EC on the promotion of the use of energy from renewable sources.

Indirect land use change (ILUC). Even before the adoption of the RED, a debate around the impact of
indirect land use change (ILUC) on GHG emissions has been carrying on. While biofuels are important
in helping the EU meet its greenhouse gas reductions targets, biofuel production typically takes place
on cropland which was previously used for other agriculture such as growing food or feed. Since this
agricultural production is still necessary, it may be partly displaced to previously non-cropland such as
grasslands and forests. This process is known as indirect land use change (ILUC) and it changes risks
negating the greenhouse gas savings that result from increased biofuels because grasslands and
forests typically absorb high levels of CO2. By converting these land types to cropland, atmospheric
CO2 levels may increase.

After about five years of discussions and negotiations, on April 28 2015, the European Parliament
approved the compromise agreement on the reform of the RED, which included a 7 percent
calculation cap on crop-based biofuels, also known as conventional biofuels, in the EU’s renewable.

New RED II: Preparation of a new Renewable Energy Directive for the period after 2020

On 30 November 2016, the Commission published a proposal for a revised Renewable Energy Directive
to make the EU a global leader in renewable energy and ensure that the target of at least 27%
renewables in the final energy consumption in the EU by 2030 is met. The objective of this survey is
to consult stakeholders and citizens on the new renewable energy directive (REDII) for the period
2020-2030, foreseen before the end of 2016.

On June 14,2018, negotiators from the European Commission, the European Parliament and the
European Council reached a deal on a revised Renewable Energy Directive (REDII) that sets new targets
for renewables. The provisional agreement calls for energy from renewables to account for at least 32
percent of the EU’s gross final energy consumption in 2030, with an upwards revision clause by 2023.
The agreement implements an “energy-efficiency first” principle.

For biofuels, the agreement states that at least 14 percent of transportation fuel must come from
renewable sources by 2030. First-generation, crop-based biofuels are capped at 2020 levels—with an
extra 1 percent—but cannot exceed 7 percent of final consumption of road and rail transport. In
addition, the share of advanced biofuels and biogas must be at least 1 percent in 2025 and at least 3.5

10
percent in 2030. Food crops, such as palm oil, that result in high indirect land use change (ILUC) are to
be phased out through a certification process for low-ILUC biofuels.

The EU has sets rigorous sustainability criteria for biofuels and bioliquids. One way for companies to
demonstrate that their biofuels comply with the criteria is to participate in voluntary schemes that
have been recognized by the European Commission.

Now that a provisional deal on the REDII has been reached, the text of the directive must be formally
approved the European Parliament and the Council. Once endorsed by both co-legislators in the
coming months, the REDII will be published in the Official Journal of the Union and will enter into force
20 days after publication. Member states will then have to transpose the new elements of the directive
into national law 18 months after its entry into force.

Incorporation of EU law in Greek national legislation

Greece Being a member state of the European Communities (since 1981), has been closely adopting
the EU legislation and regulations with limited differentiations where and if it is allowed and
requested.

• The European Directive (Directive 2003/30/EC) was adopted by amending and supplementing
Law 3054/2002 (Organization of the oil market and miscellaneous provisions) with Law 3423/2005
(Introduction of biofuels and other renewable fuels in the Greek market).

• In 2012, the latest European Directives concerning biofuels, 2009/28/EC and 2009/30/EC,
were adopted in Law 4062/2012 in section C and chapters A (Promotion of energy use from renewable
sources – integration of European Directive 2009/28/EC) and B (Sustainability criteria of biofuels and
bioliquids - integration of European Directive 2009/30/EC), as published on 30 March 3012. In the
scope of Directive 2009/28/EC, Greece elaborated and submitted its National Renewable Energy
Action Plan in June 2010. According to the NREAP, the targeted 20% share of renewable energy in the
gross final energy consumption in 2020 will be achieved through the combination of measures for
energy efficiency as well as for the enhanced penetration of RES technologies in electricity production,
heat supply, and transport. (20-20-20 Objective).

Urban Law – Building Permit

The basic principle of urban law is the need to issue an administrative permit for the execution of any
construction work. There is a general prohibition of building exploitation that prevents the owners
from exerting their rights to build and make use of their plots, if they have not previously obtained
the necessary building permit. Private building activity is thus subject to preventive administrative
control, which complies with the constitutionally guaranteed protection of the individual right to
property.

The revocation of the general prohibition does not depend on the discretion of the competent service,
but is an exercise of a captive competence of the administration, which is obliged to grant the building
permit to each individual case, provided that the legal conditions are fulfilled.

11
The building permit serves two main purposes: on the one hand, the compliance with hygiene, safety
and aesthetics rules for both the individual building and the block and on the other hand the smooth
inclusion of the structure in the approved urban planning plan of the region, ensuring the best possible
living conditions.

Law 4495/2017

The current legal status consists of law 4495/2017 (Government Gazette Α ' 167/03.11.2017).

Building Permit
The Structural Services of the municipalities (Υ.ΔΟΜ) remain responsible for the granting of building
permits and, exclusively and exceptionally, the Department of Construction and Building Regulation
of the Ministry of Environment, Energy and Climate Change.
There are three categories of building permits depending on the region, the location, the use, the size
and the environmental footprint of the building under construction. The application for the permit
must be submitted electronically, accompanied by the necessary studies and diagrams, by any
documents that prove the applicant's legitimate interest and by endorsements from other services, if
necessary.
Pre-approval of the building permit: article 35 of L. 4495/2017
The application for a pre-approval of a building permit is usually optional. As an exception and under
the provisions of article 35 of L. 4495/2017, the pre-approval of building permit for the under-
discussion project is obligatory, due to the usage of significant land surface and due to its
environmental and residential importance.
Duration of Permits: Article 42, L 4495/2017
The pre-approval of the building permit is issued within 15 days from the verification of the submitted
documents and is valid for one year for buildings up to 5,000 m2. The pre-approval permit of our
project has a two-year duration of validity due to the larger surface (15.500 hectares) that it covers.
The building permit is issued within an exclusive period of 1 month from the submission of the relevant
application and is valid for 4 years, except for buildings over 5,000 m2 like the under-discussion project
where the permit is valid for 6 years.

Taxation

Fuel taxation in the EU is considered to be too high. Taxes account for about 50% of the retail price in
most of the EU countries. This enabled the indirect subsidy for biodiesel production through their
partial or total tax exemption. However, until the adoption of Directive 2003/30 concerning the
promotion of biofuels, Member States had to go through a time-consuming and dissuasive process
and apply for a license from the EU to obtain such an exemption. With the implementation of the
Directive, this process was simplified and Member States had the right to a 6-year tax exemption on
biofuels starting in 2004, which made biofuels more competitive.

12
Green Taxation

Environmental taxes, also known as green taxes, pollution taxes or ecotaxes, are a wide range of
legislative charges on businesses and private individuals, aimed at reducing practices which cause
damage to the environment. There are many forms of environmental tax, some of which are aimed at
penalizing and discouraging environmentally damaging activities or commodities (tax increases) and
some of which are aimed to rewarding and encouraging those who employ environmentally-friendly
practices (tax decreases).

Green tax decreases

In the climate change arena, green tax decreases can send targeted, positive price signals that can
increase the use of renewable energy and improve energy efficiency in an effort to reduce reliance on
fossil fuels. These decreases can take the form of tax credits, deductions, exemptions or reduced tax
rates that otherwise would not be available under neutral principles of taxation. Green tax decreases
have a more pragmatic foundation. They also have a very different fiscal effect than tax increases,
obviously reducing the flow of revenues to the government rather than increasing it. This difference
can have significant political consequences.

Green tax increases

Both the European Union and the United States firstly proposed broad-based energy taxes in the early
1990s. From an environmental perspective, the ideal green tax for climate change would be a tax on
the carbon content of fossil fuels. Taxing the carbon would help internalize external costs and cause
the polluter to pay. The taxes that were proposed, however, did not follow the pure carbon tax model.
In 1992, the European Commission proposed a revenue-neutral tax-based half on carbon content and
half on energy value. Thus, it extended the tax to non-carbon fuel sources such as nuclear power and
hydropower, recognizing in part the fact that a carbon tax alone would have disparate impacts on the
competitive position of different member states. It also provided some tax relief for energy-intensive
industries, recognizing that competitiveness concerns had to somewhat temper the environmental
goal. Even so, energy-intensive industries resisted the tax, as did some member states that were
hesitant to accept such a tax system.

In March 2007 the European Commission issued a Green Paper to launch a discussion on increasing
the use of market-based instruments, including green taxes, in Europe. In line with the approach it
proposed in 1992, the European Commission again has suggested that fuels should be taxed according
to both their energy content and their greenhouse gas emissions (European Commission 2007, 2 and
7).

European statistics distinguish four different categories of environmental taxes relating to energy,
transport, pollution and resources. (Value added tax (VAT) is excluded from the scope of
environmental taxes).

In 2016, the total environmental tax revenue in the EU-28 (i.e., revenue from environmental taxes
collected by governments in all EU Member States) amounted to EUR 364.4 billion; this figure
represents 2.4 % of the EU-28 gross domestic product (GDP) and 6.3 % of the total government
revenues from taxes and social contributions in the EU.

13
Figure 5: Total environmental tax revenue by type of tax, EU-28, 2016. Source: Eurostat

Environmental taxes by category

Energy taxes (which include taxes on transport fuels) represented by far the highest share of overall
environmental tax revenue, accounting for 76.9 % of the EU-28 total in 2016.

Transport taxes represented the second most important contribution to total environmental tax
revenues, with 19.7 % of the EU-28 total in 2016.

Pollution and resource taxes represented a relatively small share (3.4 %) of total environmental tax
revenues in the EU-28 in 2016. This category of environmental taxes groups a variety of taxes levied
e.g. on waste, water pollution and abstraction. In many European countries such taxes were
introduced more recently than energy or transport taxes.

Figure 6:Environmental taxes by tax category, 2016 (% of total environmental taxes)

14
Environmental Assessment

The European Union has established a mix of mandatory and discretionary procedures to assess the
consequences of individual projects.

➢ EIA Directive: Directive 2014/52/EU

The Environmental Impact Assessment (EIA) Directive (85/337/EEC) is in force since 1985 and applies
to a wide range of defined for individual projects, such as a dam, motorway, airport or factory. It is
the assessment of the environmental consequences (positive and negative) of a plan, policy, program,
or actual projects prior to the decision to move forward with the proposed action. Environmental
Impact Assessment (EIA) is a process of evaluating the likely environmental impacts of a proposed
project or development, taking into account inter-related socio-economic, cultural and human-health
impacts, both beneficial and adverse. The purpose of the assessment is to ensure that decision makers
consider the environmental impacts when deciding whether or not to proceed with a project.

The EIA Directive of 1985 has been amended three times, in 1997, in 2003 and in 2009: The initial
Directive of 1985 and its three amendments have been codified in Directive 2011/92/EU of 13
December 2011. Directive 2011/92/EU has been amended in 2014 by Directive 2014/52/EU.

➢ SEA Directive: 2001/42/EC

In 2001, the issue was enlarged to the assessment of plans and programs by the so-called Strategic
Environmental Assessment (SEA) Directive (2001/42/EC), which is now in force. Under the EU
directive, an EIA must provide certain information to comply. There are several key areas that are
required:

❖ The common principle of both Directives is the aim to provide a high level of protection of the
environment and to contribute to the integration of environmental considerations into the
preparation of projects, plans and programs with a view to reduce their environmental impact.
They ensure public participation in decision-making and thereby strengthen the quality of
decisions. The projects and programs co-financed by the EU (Cohesion, Agricultural and Fisheries
Policies) have to comply with the EIA and SEA Directives to receive approval for financial
assistance. Hence the Directives on Environmental Assessment are crucial tools for sustainable
development.

The Commission expert group of EIA/SEA brings together environmental experts from national
administrations and meets twice per year. The role of the Group is to provide advice and expertise to
the European Commission and its departments in relation to the implementation of the EIA and SEA
Directives, the preparation of legislative proposals and policy initiatives, as well as coordination and
cooperation with Member States and stakeholders in that regard.

Incorporation in Greek national legislation

These EU directives have been incorporated into the Greek National Legislation with the Law
4014/2011.

According to the Ministerial Decision 1958/12 on the classification of projects and activities into
categories/subcategories, on the basis of their potential impact on the environment, and in
compliance with the provisions of Law 4014/2011, the under-assessment project is falling within:

15
 • The 9th Group of projects (industrial activities and related installations) with A/a 93
(production of liquid biofuels, as defined in Directive 2003/30/EC) and to the environmental
Category A2

• The 10th Group of projects (renewable energy sources) with a/a 5 (Electricity from bio fluids
and biofuel plants) and Environmental Category A2

Organizational Chart

Staffing Requirements

Total salaries do not strongly impact the cost, as the cultivation systems are highly automated and
only restricted labor is necessary only for management and maintenance. Most of the positions
related to the maintenance or the production can be covered with hourly employees.

III. Production
Facilities Needed
The open pond system is the most commonly used method for microalgae production, due that it is
economically feasible for high-scale biomass production and easier to construct and operate. More
specifically, they can have up to 32% fewer energy requirements, compared to other systems, during

16
their construction and operation. The main types of open pond systems used for commercial
production are the Raceway Ponds (Fig. 5) and the Circular Ponds. These ponds usually have a depth
of about 0.3 meters.

Figure 7: Spirulina production facilities in Serres (raceway pond)

Advantages and disadvantages of open ponds

Advantages Disadvantages
 Low investment needs  Low productivity
 Low power consumption  Little control of culture conditions
 Easy to clean  Water evaporation
 Easy to maintain  Small illumination surface area
 Easy scale-up

Solutions to the disadvantages

Low productivity: As long as all the nutrients are provided and both the temperature and pH are
satisfactory (this can be achieved through a greenhouse), the productivity of biomass depends only
on the availability of sunlight. The available light of the culture declines if the depth is increased.
Therefore, a shallower pond will be selected in order to maximize efficiency.

Little control of culture conditions: The open pond will be placed inside a greenhouse, in order to
achieve the best possible control of conditions and avoid contamination.

Water evaporation: To avoid any water shortages in the ponds, it is planned to install water tanks in
order to replenish any losses that occur due to evaporation or during the harvesting of the algae. In
addition, a stable seawater and wastewater (treated) supply are planned, which will both replace
water losses and supply nutrients for the growth of algae.

17
Production Process
Microalgae Selection
Selection of the optimal algal strain is not an easy task, as there are more than 300.000 species of
microalgae. Albeit, this is a key component of a successful algal biofuel venture. A number of
parameters need to be kept in mind while evaluating algal strains for their suitability as a biofuel
feedstock, with the most important being their lipid production.
In most cases, native microalgae species are used in commercial production as they can adapt better
to the local ecological and climatic conditions.
For the open pond system, which has been chosen for this particular production unit, the most feasible
and with the highest rate of growth species are Spirulina Platensis, Dunaliella Salina, and Chlorella.
The species that was selected to be used in this production is Spirulina Platensis, as it is a local species
of algae in Greece and one with high lipid productivity of about 9% to 16%. Apart from the high lipid
productivity, Spirulina Platensis requires a high pH and raised salinity for optimal growth, factors that
do not allow many invasive species to grow in excess.

Microalgae Cultivation
During the cultivation process, a high input of nutrients is required for the growth of the algae, as
mentioned before. The nutrients are fed into the pond near the paddlewheel, in order to achieve
optimal mixing throughout the pond. It is also important that the nutrients are fed during the hours
of the day with the maximum sun irradiation, when the photosynthesis is taking place.
An important input for the algal strains is the carbon dioxide. This stabilizes the pH of the water which
should be controlled between 8 and 9. Abrupt fluctuations in the pH can have negative effects on the
cultivation.

Other inputs required during the cultivation are:

- Water: Microalgae can tolerate a wide range of salinity and have a large water requirement.
Moreover, wastewater can be used, under certain conditions, to provide a variety of nutrients.
Although, even if wastewater provides a proper alternative solution, freshwater will still be
necessary for the downstream processing of the biomass. For the optimal growth of Spirulina
Platensis, alkaline water intake with pH around 7.5 to 9.2 is required.
- Fertilizers: Algae are large absorbers of CO2 and more specifically, one ton of algae require for
their growth 1.8 tons of CO2. For optimum growth, algae also need nitrogen, phosphorus and
silicate as well as a range of micronutrients. Especially in the case of Spirulina Platensis, which
contains high amounts of proteins, a significant intake of nitrogen fertilizers (ammonium
nitrate, potassium nitrate etc.) is needed. An alternative source of CO2 can be the waste
streams of nearby industry or power plants which can provide an ample quantity of nitrogen
and phosphorus.

Harvesting
To consider the lipids obtained from microalgae a viable raw material, it is necessary to have in mind
the harvesting method to use. This stage can represent a 20–30% of the total cost for biomass
obtaining as it is an energy intensive process.

18
From all the harvesting methods, filtration (mechanical harvesting using membranes) is the most
feasible solution as it provides the shortest harvesting time among the other methods, has moderate
operate and logistic costs and has no negative impacts on the environment.

Drying - Oil Extraction

After the harvesting, the algae have about 90% water content, hence drying is necessary to obtain
their lipids. Most methods require large energy or chemical inputs (flash drying, spray drying) and
therefore are not feasible for small and medium-scale production.
In this case, the method that will be used is solar drying. During the process, the harvested biomass is
spread over the drying beds in shallow layers. This way the drying is accelerated and any unwanted
lipid losses can be avoided.
Afterwards, the collected biomass is stored in silos and from there is transferred in equal doses to the
extraction facilities. The extraction will be done by chemical methods, as they are more economical
compared to the mechanical methods and more suitable for the lipid extraction from Spirulina algae
species.

Transesterification
Transesterification is a chemical process which uses a catalyst to convert the extracted algae oil into
biodiesel. The most used catalysts available for the transesterification reaction are the base catalysts
since they are cheaply available and offer higher yields in shorter period of time when compared to
other catalysts (e.g. acid catalyst, enzymatic catalyst, etc.).

Figure 8: Biorefinery strategies for production of biofuels from microalgae biomass

19
Storage & delivery
Biodiesel should be stored in a dry environment without an influx of water and sunlight. Presence of
water can cause the formation of bacteria and other microorganisms inside the tank. The tanks that
may be used are similar to those for the storage of petrochemical diesel made mostly of aluminum or
steel.

Equipment and Machinery Needed

Baffles
In ponds with semicircular ends (Fig. 8), curved baffles or flow deflectors are commonly installed at
both ends. The baffles ensure a uniformity of flow throughout the curved bend and minimizes the
formation of dead zones. Dead zones adversely affect mixing, allow solids to settle, and cause
unwanted energy losses.

Figure 9: Raceway pond cultivation system

20
Paddlewheel

Paddlewheels are generally believed to be the most

effective and inexpensive means of producing flow in
raceways.

A raceway is typically mixed by a single paddlewheel

to avoid interference between multiple
paddlewheels.

An eight-bladed paddlewheel (Fig. 9) with flat blades

is generally used, but paddlewheels with curved
blades are also in use.

Most of the mixing occurs in the region of the

paddlewheel and at the semicircular ends where the
flow turns around.
Figure 10: A typical eight-bladed paddlewheel
used for mixing in a raceway pond

Gas diffusers

Microporous gas diffusers (Fig. 9) are used in

raceways to provide carbon dioxide in the form
of fine bubbles. The CO2 is supplied throughout
the pond with the use of tubings.

The demand for carbon dioxide varies with the

rate of photosynthesis which is controlled by the
irradiance. Therefore, the best strategy to ensure
a sufficiency of carbon and minimize loss is to
inject carbon dioxide in response to a signal from
a pH controller.

Note that the diffusers should be easily

removable from the gas distribution tubing for
Figure 11: A microporous gas diffuser
cleaning and replacement.

Output Limitations

Dissolved oxygen
Photosynthesis generates oxygen and is inhibited by an accumulation of dissolved oxygen in the
culture broth. During peak sunlight the level of dissolved oxygen may exceed 300%. This can reduce
the rate of photosynthesis and adversely affect the biomass productivity.

21
A possible solution to that problem is the construction of relatively small ponds as they can achieve
better oxygen removal than larger ponds. This is because the proportion of the zone of good mixing
and mass transfer in the vicinity of the paddlewheel is larger in a small pond compared to a larger one.

Contamination
A major problem for open pond cultures is the contamination with other organisms like bacteria,
which can lead to instability of the microalgae cultivation and thus of the production rate.

This may be prevented by growing microalgae under extreme conditions such as high pH or high salt
or by placing the lakes inside greenhouses with controlled environmental conditions. As this is
considered a small-scale project, it can be economically feasible to protect the ponds with
greenhouses.

Moreover, water filtration may help to reduce the frequency of certain types of infestations, but this
is a more expensive solution. Besides that, the typically used microfiltration does not prevent
contamination with viruses.

Evaporation
The average evaporation that occurs in open pond systems located in mild climates is between 1.8
and 2.4 meters annually. As a result, continuous water supply is needed, which can be either fresh
water, wastewater or seawater.

The facilities will be located at the seaside (unlimited access to seawater) and will have access to large
amounts of municipal wastewater which can provide a range of nutrients and boost the algae growth,
as mentioned before. In addition, other types of wastewater such as agricultural drainage might be
available as well.

22
Engineering and Design Support

Filtration

This type of algae harvesting method uses a medium that is permeable so that it can retain the algae
biomass while allowing the liquid to pass through. This technique requires a pressure difference across
the filter which can be driven by vacuum, pressure or gravity. The membrane filters can be classified
based on the size of the pores into macro filtration (greater than 10 μm), micro-filtration (0.1-10 μm),
ultrafiltration (0.02-0.20 μm) and reverse osmosis (less than 0.001 μm). The pressure required to force
the fluid across the membrane decreases as the pore size of the membrane is increased. Filtration
techniques can concentrate microalgae cells in the suspension upto 5-18% and the operating costs
vary from $10 to $20/gal. The harvesting efficiency using filtration methods ranges from 20% to 90%

Type of pressure filtration: Pressure

filtration harvesting can be achieved by
plate-and-frame filter presses or by using
a pressure vessel that is equipped with
filters as shown in Figure X. The plate-and
frame filter presses work by forcing the
liquid in the microalgae suspension
through the filter using high pressure. A
series of rectangular plates that are
mounted in a vertical position, face to
face, make up the press system. A fitted
filter cloth is applied to each of the plates
and they are held together with one
another by force under pressure. The
fluid that contains the algae is pumped
into the gaps between the plates and the
pressure is applied in order to force the
liquid through the plate outlets and filter Figure 12: Vertical pressure filter (vessel)
cloths. After separation, the dewatered
microalgae cake is recovered.

Energy consumption: This method can be considered energy efficient since a minimal amount of
energy is required upon assessment of the output product and the amount of initial feedstock added.
However, the effectiveness of the method is dependent on the type of algae species.

Mohn4 found that pressure filtration was suitable for the species Spirulina platensis.

Advantages and disadvantages: Some of the advantages of using pressure filtration are: the cakes
collected (composed of the particles in the liquid suspension) have low moisture content, the soluble
recovery from the cake is high, re-circulating the filtrate for 1-2 min will clean the filter, high degree

4
Mohn FH (1980) Experiences and strategies in the recovery of biomass from mass cultures of microalgae. In
Algae Biomass. (G. Schelef and C. J. Soeder ed.), Elsevier, Amsterdam: 547-571
23
of clarity in solutions can be achieved and alloy and synthetic materials can be used to construct the
filters and the internal parts. The disadvantages of using this technique include: the difficulty in
washing the filter medium which increases when the solid is sticky, the internals are difficult to clean
in food-grade applications and the difficulty in viewing the condition of the filter due to vessel
encapsulation.

Chemical Oil Extraction

Supercritical Fluid Extraction

The supercritical fluids method extracts up to 100 percent of the oil from algae. CO2 acts as the
supercritical fluid -- when a substance is pressurized and heated to change its composition into a liquid
as well as a gas. At this point, carbon dioxide is mixed with the algae. When they're combined, the
carbon dioxide turns the algae completely into oil. The additional equipment and work make this
method a less popular option.

In supercritical fluid/CO2 extraction, CO2 is liquefied under pressure and heated to the point that it
has the properties of both a liquid and a gas, this liquified fluid then acts as the solvent in extracting
the oil.

In the specific industry, Carbon dioxide was supplied with a purity of 99.995% from HelPe. Supercritical
carbon dioxide extractions perform best at the temperature 50ºC and pressure 250 bar. These
extraction conditions were chosen taking into account previous work reported for the extraction of
lipids from other microalgae [26-28].

Figure 13: Scheme of experimental installation

A schematic diagram of the pilot plant, Bench Scale SFE-500 Separex unit, is given in Figure 1. Solvent
(CO2), from the cylinder, is delivered through h a pipe to the condenser. Liquid CO2 reaches the inlet
of the high-pressure pump rated up to 200 bars. Compressed fluid is fed to the heater prior to entering
the extraction vessel. The unit contains an extraction container of 450 ml, closed with stainless steel
porous discs. The extractor is heated by a heating jacket surrounding the outer surface of the vessel.
The

24
extraction pressure is controlled by means of a back-pressure regulator valve, BPR where
depressurization of CO2 flow stream exiting the extraction vessel takes place. The extracted
substances are precipitated and collected into a glass trap, immersed in an ice bath. To ensure a total
recovery of compounds, the gas flow coming out from the first trap passes through a second glass
trap.

Once the oil's extracted, it's refined using fatty acid chains in a process called transesterification. Here,
a catalyst such as sodium hydroxide is mixed in with an alcohol such as methanol. This creates a
biodiesel fuel combined with a glycerol. The mixture is refined to remove the glycerol. The final
product is algae biodiesel fuel.

IV. Market and Competitors

Description of Customers
A large share of the customer community currently has moved to alternative fuels and more
specifically to biofuels. Moreover, it is expected that customers will gradually move to third generation
biofuels. Similarly, more and more companies, especially those using large quantities of petrochemical
diesel in their production, will move to biodiesel in order to decrease their CO2 emissions and
therefore their environmental tax burdens.

Customer Needs and Benefits

The fact that algae biodiesel can be used in conventional diesel boilers and engines without any
modifications being necessary, offers an important advantage for the customers. By using a blend of
diesel which includes biodiesel in an engine, the customer can reduce the overall emissions of the
engine by up to 75%. It also offers natural lubricity which contributes to the good working condition
and maintenance of the engine.

Customer Decision Criteria

All diesel vehicles can run on lower blends of biodiesel, which are the most common and include the
B5 (up to 5% biodiesel) and B20 blends. These blends can be used without any modifications in most
vehicles.

Market Analysis
From the 18 active companies in the biofuels sector in Greece, 12 are producers and 6 importers.
Their production accounted for 93% of the commercial biodiesel traded in Greece in 2015
(approximately 130,000 cubic meters).

Competition
Currently, in Greece, biodiesel production derives mostly from conventional feedstock of first and
second generation which are disadvantageous in terms of price and environmental friendliness.

25
SWOT Analysis

V. Business Strategy

Economic, Political, Legal Factors that Affect the Strategy

Greece has a mandatory target for the blending of biodiesel into diesel at exactly 7% in volume
of the whole quantity of diesel used in transport in 2018. This obligation has applied since
2014.

The law 3054/2002 states that producers and distributors of petrol and diesel are required to
blend their fuels with a certain number of biofuels, which is redefined each year.

VI. Forecasts and Financial Data

Performance and sales Forecasts

The yields of algae biomass per hectare (10,000 m2) can reach up to 14,000 tons per year. This
depends on the different methods of growing, the climate, the nutrient inputs etc. There are two main
factors that affect the biomass yields in this case:

• The open ponds method that will be utilized, has relatively low costs, but also significantly
lower productivity and thus less yields than other methods.

• The company will operate for 11 months per year, allowing one month for maintenance of the
equipment, cleaning of the ponds and other procedures.

26
For the above reasons, the low scenario of production will be considered5, where the company will
only yield 2,500 tons of algae biomass per hectare in the first year. This number increases to 2,800
tons in the third year, 2,900 tons in the fourth and finally to 3,000 tons in the fifth, considering
improvements in the production process.

From these amounts, only half can be transformed into biodiesel which is the final product of the
company. The price of biodiesel is estimated at 325€ /ton. Based on these factors we calculate the
production yields and the revenues of the first 5 years as follows:

In the sixth year, we estimate an increase of 4% in the revenues, compared to the fifth year. Up to the
tenth year, the revenues will increase yearly by 1%. This is due to the growth of the company’s sales
network and possible exports to countries where biodiesel can be sold at higher prices.

From the eleventh year, the revenues begin to decline, reaching a point where Earnings Before Taxes
are estimated at 1,751,684€ in the twentieth year when the company will halt its operations.

Profit and Loss Accounts

The only revenue streams of the company that are considered in the financial model of the business
plan derive from the production and sale of biodiesel.

Apart from that, a fraction of revenues comes from the management and processing of wastewater
which can be subsidized by the government. These grants are not included in the financial statements
though as they are not considered a stable source of revenue.

For informative purposes, the minimum subsidies that can be received through the wastewater
management in the first five years are the following:

Although this process cannot be considered as revenue generating, its main advantage is the saving
costs from the use of the recycled nutrients like nitrogen and phosphorus which are used for the
growth of the algae.

5
The low scenario as presented in the Sensitivity Analysis chapter.
27
If this method was not utilized, the expenditures for nutrient inputs would surpass the 30% of the total
operating expenditures, while by utilizing it they are reduced to about 22%.

Other major cost factors are the harvesting and drying of the algae biomass, which accounts for the
17% of the operating costs, the land rent (13%), the cost of labor (11%) and energy usage (7%).

Cash Flow Forecasts

The net cash flow forecast shows that in the first 5 years of operation the company has negative cash
flows, which gradually begin to rise in the 6th year and stay positive until halting of operations in the
20th year. The maximum cash flow is observed in the 14th year and from the 15th year, it begins to
decline because of the increasing costs of equipment maintenance, aging machinery and other factors.

The cumulative net cash flow only becomes positive in the last year of operations.

28
The project can maintain this positive cumulative net cash flow for up to the 27th year with a
theoretical yearly reduction in revenues of 0.5%. This reduction would, in reality, be much more,
therefore, an extension of the production period would only be viable for 2 to 3 years.

Sensitivity Analysis
Three different scenarios are considered in the sensitivity analysis. The first scenario includes the by-
products that can be made from the remaining amount of biomass and the additional revenues they
can bring to the company. The other two scenarios are the “higher productivity” and “lower
production costs”. In these, a theoretical approach is taken into account where the total amount of
biodiesel produced and the production costs respectively take different values which make the project
more profitable.

29
Low scenario
The “low” scenario on which the whole project is based includes the following values:

By-product scenario
The by-product scenario is based on the assumption that the company will take advantage of the
leftover biomass from the biodiesel production and process it to make pellet fuel of high energy value.
The rising selling prices of biomass will greatly increase the profits of products and byproducts,
ultimately lowering the actual economic cost.

Pellets are solid biofuels that are burned in certain boilers, mostly for industrial use. The product is
eco-friendly and can be sold up to 30% cheaper than pellets made from wood. The figures are
calculated as follows:

Considering a 5% increase in the operating costs, which covers the pellet production expenses, we get
the following data:

30
The total gross revenues are 207,818,039€ (27,539,127€ higher compared to the low scenario) and
the operating costs 134,646,218€ (6,411,724€ higher than in the low scenario).

The IRR of the investment is calculated at 8.4% (3.9% higher than in the low scenario) and the
cumulative net cash flow 10,025,319€ (9,694,614€ higher than in the low scenario):

The by-product scenario is clearly more preferable than the basic scenario, as it offers a ROI of 8% as
calculated as below:

31
Higher productivity scenario
In this scenario the total amount of biodiesel produced per year is considered to be 11% higher than
in the low scenario which translates to 25,000 tons of biodiesel per year as we can see:

The total gross revenues are 232,071,550€ (51,792,638€ higher compared to the low scenario).

The IRR of the investment is calculated at 12.8% (8.3% higher than in the low scenario) and the
cumulative net cash flow 23,717,811€ (23,387,106€ higher than in the low scenario):

Thus, we can observe a significant increase in the cumulative cash flow and the gross revenues (about
29% more revenues than the low scenario). The higher productivity presented in this scenario can be
achieved mostly through research aimed at improving the cultivation technology, boosting the growth
rate of the algae and increasing the lipid extraction efficiency.

The higher productivity scenario offers significantly higher returns than the two previous scenarios
and it has an ROI of 20,63% as we can see:

32
Lower production costs
Finally, in this scenario the biodiesel production costs per ton are presented to be 10% less compared
to the low scenario:

Which returns total operating costs of 115,411,044€ (12,823,450€ less than in the low scenario).

The IRR of the investment is calculated at 7.3% (2.8% higher than in the low scenario) and the
cumulative net cash flow 6,795,644€ (6,464,939€ higher than in the low scenario):

Here we have a much better performance than in the low scenario, but at the same time, a much
worse performance compared to the high productivity scenario (about 249% difference in the total
gross revenues).

The lowering of the production costs presented in this scenario can be achieved by utilizing more
processed municipal wastewater in the production process in order to decrease the need to buy extra
nutrients such as nitrogen and phosphorus. Other possible solutions which can make this scenario
more realistic are:

• Industrial waste from nearby plants to be used as a CO2 source

• Use higher quantities of wastewater and seawater to reduce the total freshwater
consumption
• The excess algae biomass to be burned to produce electricity which will be used in the
production process, decreasing the energy consumption

33
 VII. Financing Requirements
Funds Required and Timing
The total cost of the investment is calculated at 15,000,000€. This amount includes the operating and
capital expenditures (OPEX and CAPEX) of the first five years and the expansion costs of the production
facilities up to the 15.5 hectares (includes 0.5 hectares for office facilities and roads).

The initial funding, which will cover the capital costs of the first five years will be covered by a bank
loan (50%), government subsidies (10% and up to 40%), a limited partnership financing (25%) and
other investment vehicles (15%).

Bank loan: The bank loan will be issued with an interest rate of 6.5% and will have a repayment period
of 20 years. The total amount of the bank loan is 7,500,000€.
The total amount to be paid in interest fees is 6,113,459€, calculated as below:

Government subsidies: The funds from government subsidies can be used, according to the Greek
law, for the construction of the following:
• The buildings (includes earthworks and foundations)
• Electrical and plumbing installations

34
 • Ventilation installations
• Water supply and water tanks installations
• Installation of waste management systems
• Expenses for issuing the building permit
• Configuration of specialized spaces (in this case the open ponds)
• Other equipment related to the activities of the company

The total amount that the company is estimated to receive from government subsidies is 1,500,000€
but can reach up to 6,000,000€.

Limited partnership: The limited partnership investment vehicle was chosen in order for the project
to be eligible for funding from the InnovFin program (see other investment vehicles). A limited
partnership includes the general partners and the limited partners. The limited partners will
contribute 3,750,000€ to the project.

The general partners are responsible for the day-to-day management of the company and are liable
for the company's financial obligations.

The limited or “silent” partners provide capital but cannot make any managerial decisions neither are
responsible for the company’s debts except for their initial investments. They do not receive dividends
but can have access to the company’s flow of income and expenses.

Other investment vehicles: Funds from EU institutions will be used to cover up to 15% of the capital
costs of the company, or 2,250,000€. Currently, the most funds for energy-related projects are
available from the InnovFin program which is supported by the European Investment Fund.
The requirements for a company to be eligible for funding are:

• Total investment cost of at least 15 million euro

• The project should contribute to the energy transition, renewable energy technologies,
carbon capture utilization, etc.
• The technologies demonstrated in the project should be in pre-commercial or early
commercial stages
• Financing of at least 25% of the total investment cost from Promoters (limited partnership,
direct investment, etc.)
• The company should be located in one of the EU Member States

35
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