Christian Cuenot, VP biomethane & bio-LNG, VARO Energy, talks to Bioenergy Insight about VARO's innovative work, ahead of his talk at this year's International Biogas Congress & Expo, to be held on 18-19 June in Brussels.
Can you give us an introduction to VARO Energy and the work that you do?
VARO Energy (VARO), a Switzerland-based private company, is the partner of choice for customers in the energy transition by providing the sustainable and reliable energy solutions that they need to decarbonise. Engine 1 includes manufacturing, storage, distribution, marketing and trading of conventional energies. Engine 2 activities are focused on sustainable energies and include biofuels, biogas, green hydrogen, e-mobility and nature-based carbon removals.
VARO plans to invest around $3.5 billion (€3.2 billion) over the 2022-26 period, with two-thirds committed to sustainable energies. The company has a net-zero target for scope 1, 2 and 3 by 2040.
Our organisation aims to become a leading producer of biomethane and bio-LNG via selected acquisitions and industrial-scale greenfield projects. VARO has in-depth biotickets expertise and compliance-short, advantageous customer relationships through its fuels business and expertise in biofeedstock sourcing.
We acquired 80% of the shares in Bio Energy Coevorden BV (BEC) in the Netherlands, one of the largest biogas manufacturers in Europe, with a plan to double the current facility capacity from 300 GWh to 650 GWh by 2026.
VARO also owns RES, one of Europe’s leading biogas trading companies, adding a trading capacity of 1 TWh of biogas and Green Certificates per year — equivalent to the greenhouse gas (GHG) emissions of 100,000 European homes. VARO’s overall approach can be summarised in five ways:
• A more multidimensional view on energy security and affordability. At VARO, our integrated portfolio of energy solutions is addressing that;
• Building businesses that are economically viable, socially acceptable and politically relevant, with a convergence of collaboration between industry and customers, regulators and consumers;
• A practical approach to the energy transition, where conventional energies partner with renewable energies. We invest in both conventional energies and sustainable energies;
• A stable regulatory construct that accelerates investments;
• Investing in the repurposing of existing infrastructure and capabilities.
You will be a speaker at the 2024 International Biogas Congress & Expo. What will your talk address in particular?
BioLNG is the most competitive fuel for transport decarbonisation. It replaces LNG, as it consists of the same main molecule — CH4. Its overall supply is driven by availability of feedstock, especially because it needs to be produced from advanced feedstock. Its full potential has not yet been fully harvested, either in Europe or in the rest of the world. To enable large-scale bioLNG supply — beyond compliance regulations, incentives and lean permitting processes — the sector requires more equity investment, more offtake contracts and more trading options, such as worldwide-certified mass- balancing regulations.
We are already in action supporting hard-to-abate customers. For example:
• Partnering with Orim Energy to provide shipping customers in the Port of Rotterdam — and the wider Amsterdam-Rotterdam-Antwerp (ARA) region — with biofuels. The agreement supports the decarbonisation of maritime transportation and inland shipping in Northern Europe. It also contributes to the wider targets set by the International Maritime Organization (IMO) to reduce the total annual GHG emissions from shipping by at least 20% by 2030 and at least 70% by 2050, compared with 2008 levels.
• Partnering with Höegh Autoliners, a leading global provider of ocean transportation solutions, to supply 100% advanced biofuels for deep-sea transportation from Europe.
• Constructing a large-scale Sustainable Aviation Fuel (SAF) manufacturing facility at the Gunvor Energy Rotterdam site, investing with the aim of helping its airline customers decarbonise. This facility alone is expected to contribute up to 7% of the EU’s 2030 SAF target. This is at the heart of the ‘Customer Lighthouses’ which have been established by VARO to support customers in the ‘hardest-to-abate’ industries, such as aviation, in their energy transition. The first of these was announced with Lufthansa and VARO.
Will this be your first time at the 2024 International Biogas Congress & Expo? If so, what has attracted you to the event? If not, what has made you want to return?
I’ve been attending every year over the past three years, and I like this central event. The attendance is very international, and brings wide perspectives on the European market. The networking is intense and helps to uncover new opportunities, better understand current regulations — as well as getting some hints on the coming regulations.
What do you feel are the major challenges facing the bioenergy sector, and how do you think they can be overcome?
The current market environment is quite bearish, with low CO2 prices and low certificate values. While the medium- and long-term ambitions are quite bold, the short-term perspective is making it difficult to develop the industry as quickly as possible.
Furthermore, the permitting processes are still quite lengthy. Cross-border traders can be an enabler to harvest the maximum biogas potential worldwide but still requires the framework to come into place — such as the Union Data Base (due to come soon) and further toll agreements.
Can you tell us about a project that VARO Energy is particularly excited about?
At our plant Bio Energy Coevorden BV, while doubling the size form 300 GWh/y to 650 GWh/y, we are implementing a bio-CO2 liquefaction unit. This is very exciting as it adds new products to our portfolio and we need to establish a new business line. It also lays the floor for future options in e-fuels production.
What is your main professional focus for the rest of this year?
2024 will be a tough year in the renewables space with lower prices, but at the same time it represents a healthy challenge to optimise our current assets and positions. We will be aiming at getting stronger on the feedstock sourcing space to support the growth of our plant, as well as offering our customers the full range of decarbonisation solutions including bio-LNG supply.
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