Dry Fermentation Disadvantages

Dry Fermentation technology

While we are promoting biomass use in general and Dry Fermentation projects, specifically, and thus want to point out the positive aspects, we view it essential to also point towards some negative aspects to consider. Knowing them allows dealing with them.

As with any new technology, the phase when it “crosses the chasm” requires change in behaviour, set-up and go-to-market strategy on behalf of early players. (This is true also Dry Fermentation vendors, even though it is comparatively “low tech”). Unfortunately, while offering technologies in market demand, often these companies are tied down to daily operations, overseeing fundamental requirements for sustained growth of their company. This is often indicated by a lack of attention to anything not directly related to ongoing projects.

We are experiencing this phase with Dry Fermentation currently, and similarly with biomass energy plants, no matter what technology, in Germany. Many vendors have bagged orders for all of 2006 already from German customers, i.e. anything in addition is beyond their current capacities. For some of them expansion is difficult to manage beyond their daily operational requirements, some are not prepared for international business.

For parties interested in their technologies, this can mean a painfull, sometimes dead-end, communications approach. So, if you are interested in information and vendors attention, do not expect the level of sales attention and pre-sales support you are getting in mature industries.

On the other hand, biomass energy and Dry Fermentation have *so* much potential, that it is well worth climbing a few hills.

Another positive aspect of this current scarcety of capacities is that it opens doors. We expect typical market mechanisms to work well in this industry sector. Bioenergy has a *very* favourable climate for investors and various types of investments. Recent IPO and stock developments of companies like Conergy and Suzlon are showing the way for other players inside and outside of Germany. We are monitoring these developments, and expect new players with a global vision for Dry Fermentation to appear. The economic potential for sound investors to enter a niche now, dominate it soon and thrive on a long-term growth wave is given.

Dry Fermentation plants

When there is a choice between Dry Fermentation and other forms of green energy production, the early state of this industry sector is also indicated by a lower scale of economics and financial return for Dry Fermentation plants. This is owed to the fact that bio*mass* is involved, i.e. cost of plantation/purchase, cost of logistics and residues, unlike as for wind or solar energy. We expect to see the cost per MW to take quite a dive over the next years, but as of now, these factors must not be underestimated well in any project.

However, quite often, this choice is not existent or relevant. And wherever there is abundance of either biomass from plantation or from organic waste, the coin flips over to the upside in terms of economics.