Our approach to bioresources
We take partially treated sewage and generate renewable energy and quality products that go to agriculture, thereby creating value from waste. The bioresources market is estimated to be worth up to £1.6bn in the UK, and Yorkshire Water currently spends around 8% of its annual operating costs treating sludge.
Our AMP7 plans for bioresources centre around continuing to provide this high-quality service as efficiently as possible in the context of a growing population and extreme weather events. Our plan includes maximising energy generation at our sites and embracing the sludge treatment competitive market as part of an industry-wide effort to drive efficiency, boost resilience and deliver further innovation within the water sector. Our Bioresources Plan for 2020 to 2025 also includes offering more opportunities for third-party companies to enhance how we transport, treat and recycle sludge.
In 2020/21 we produced 147,500 dry tonnes of sewage sludge, which was treated and recycled. We aim to use all our sludge to produce renewable energy through a process known as anaerobic digestion. This renewable electricity is used to provide the power to operate our sewage treatment works and sludge treatment facilities. We also use the renewable heat provided from this technology in our operations. This renewable energy benefit helps us keep costs down for customers. In 2020/21 over 199,000,000 KWH of renewable energy was produced and used. This year we are commissioning additional assets at our Huddersfield site, which should enable us to recover and use even more renewable energy. All our sludge is treated to the Assured Biosolids Standard (BAS standard). This is a national standard that is independently audited, ensuring we are 100% compliant with best practice standards for recycling of this material.
Our areas of focus
Our key areas of focus are our two performance commitments - increasing our renewable energy generation from biogas and producing quality agricultural products which allows us to achieve 100% biosolids accreditation. We are also focused on our efficiency and utilising the market for bioresource services to drive down our £/TDS (tonne dry solid) costs, providing our customers with value for money. Safety of our people and the environment is also a key focus for our business.
This year we are continuing our energy generation improvement plan with a focus on our new assets at Huddersfield, which are commissioning in summer 2021. These will provide additional energy generation capacity.
Our market approach
As part of our PR19 plans to improve our efficiency and resilience we will be looking to deliver our services differently, considering what alternative solutions exist in the wider market. We plan to use advances in technology and third-party expertise to help avoid waste, maximise use of renewable energy and to continue producing a high-quality product to agriculture and industry.
To aid our thinking, in 2018/19 we carried out a large-scale market testing exercise, and held a number of supplier days to engage with potential suppliers on our aspirations for the bioresources business and how we are looking to the market to support us in delivering our company outcomes.
Since then we have continued to carry out more targeted market engagement on the identified areas of opportunity including sludge transportation, use of biogas and sludge treatment capacity. We are particularly interested in turnkey or Design, Build, Finance, Operate, maintain market solutions, where a third party develops and manages its own assets and recovers its investment through a gate fee.
Sludge transportation: On understanding the value and efficiency we could achieve regarding our logistics and transport of raw cake and liquid sludge; the market was identified as one way in which cost savings could be achieved. In 2019/20, our tankering operations were put out to commercial tender. A new contract has been awarded for these services, which began at midnight 03/06/2020.
Use of biogas: We expect to go to market in Autumn 2021 for a biogas third party solution starting at two of our sites. This will operate as a gas sales agreement whereby a third party will purchase the biogas from Yorkshire Water and develop their own upgrading facilities on an allocated area of land. This will be advertised on Achilles for any interested parties to bid on.
Sludge treatment capacity: We are forecasting to require up to 14,000TDS of additional sludge treatment capacity by 2025; the end of the current regulatory period. This increased capacity requirement is driven by a combination of Phosphorus removal obligations, under the Water Industry National Environment Programme (WINEP), ageing assets and population growth. We are looking to meet this need through a market-delivered offtake agreement, to secure an efficient and resilient service for our customers. Procurement for this service is expected to commence early 2022 and will likewise be advertised on Achilles.
We hope that the Market Information Publication helps you to understand the scale and details of our bioresources operations. We continue to seek to use markets to drive high standards of environmental performance and value for money for our customers. Please let us know if you think there are additional market services that provide an opportunity for improvement, or of any additional information you'd like to see - we are keen to share as much as we can to help organisations who might want to work with us.
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