NGS’ NG/LNG SNAPSHOT – April 15-30, 2022
City Gas Distribution & Auto LPG
No bias against CGD players in gas allocation, says petroleum board
The CGD players have raised concerns that the reduced allocation of domestic natural gas, and a 110% hike in domestic gas price from April 1 forced them to blend RLNG with domestic gas and increase the CNG and PNG price by Rs 10 per kg/scm.
The Petroleum and Natural Gas Regulatory Board (PNGRB) has denied allegations of discrimination against city gas distribution (CGD) companies in natural gas allocations since April 2021.
A senior PNGRB official told FE that 10% extra allocation of gas used to be made to every CGD player based on their previous six months’ allocation after a review. But the reduction in sales during the Covid period lowered the base for fresh allocations. The CGD players will get the same level of hike from the March review since the sales are back to pre-Covid levels, the official said.
However, the official accepted that the allocations have not kept pace with the increased demand in the last couple of months due to which CGD players had to blend costly regasified natural gas (R-LNG) with domestic gas to produce compressed auto fuel (CNG) and piped cooking gas (PNG). The CGD players have raised concerns that the reduced allocation of domestic natural gas, and a 110% hike in domestic gas price from April 1 forced them to blend RLNG with domestic gas and increase the CNG and PNG price by Rs 10 per kg/scm.
Companies such as Mahanagar Gas (MGL) are blending around 15-20% of R-LNG with local gas. Despite a decision of the Union Cabinet to give 100% gas supply under ‘no cut’ priority to the CGD sector, current supplies are at March 2021 demand level. The ministry is supposed to make an allocation of domestic natural gas, which costs a sixth of imported LNG, every six months in April and October every year based on verified demand in the previous six months. But no allocation has been made since March 2021, PTI report added.
GAIL to invest Rs 5k cr for gas distribution network in KMC area
The Bengal Gas Company, a joint venture of GAIL and Greater Calcutta Gas Supply Corporation, is developing a City Gas Distribution Network (CGD) in the Kolkata Municipal
Corporation area and parts of adjoining districts to provide eco-friendly and affordable greener fuel to CNG stations, PNG (piped natural gas) connections to domestic households, commercial and industrial units. The investment for the project is Rs 5,000 crore.
GAIL’s pipeline network will facilitate the supply of natural gas to 38 lakh domestic households, and CNG to more than 600 stations and a large number of industrial and commercial establishments in major industrial cities and towns of 22 districts in the state within a few years.
Speaking at a panel discussion during the session on mining and allied industries at the Bengal Global Business Summit, M V Iyer, director (business development), GAIL (India) shared details about the company’s ongoing natural gas pipeline infrastructure projects in the state of West Bengal.
25k households opt for PNG connection in Patna City
More than 25,000 households in the city have so far opted for piped natural gas (PNG) connection for cooking purposes by giving up liquefied petroleum gas (LPG) cylinders. The Gas Authority of India Limited (GAIL),
which is laying underground pipelines to supply PNG to households, has created the infrastructure to cover at least 50,000 houses and apartments in the city.
The GAIL has set the target to lay the pipeline to supply PNG to 14 lakh households with an expenditure of Rs 2,500 crore under the Pradhan Mantri Urja Ganga Yojana launched in February 2019.
A GAIL official said 7,500 households in Patna are using the environment-friendly fuel. Ghayur Alam Zahiri, chief manager GAIL-Patna, said they have received application from 25,000 households for PNG connection. “It will take 15 days to 3 months to start supply of piped cooking gas to these households. We are expanding our pipeline network and one district regulating station (DRS) has been installed at Subhash Park near Gandhi Maidan, to cover the nearby areas. At many places, we could not lay pipeline because of Patna Metro Rail work,” he added.
At least six district regulating stations have so far been installed in the city at AIIMS-Patna, BIT-Mesra, IGIMS, Danapur Railway Colony, Anisabad and near Gandhi Maidan. A K Sinha, general manager of GAIL-Patna, said the company has laid more than 400-km-long pipeline and created infrastructure for PNG supply to 50,000 houses by the end of 2021-22 fiscal year, covering areas like Jagdeopath, Jalalpur, DRM Colony, RPS Colony, Rukanpura, Gola Road, AIIMS Colony, Vijay Nagar, Ved Nagar, Raja Bazaar and Ashiana-Digha Road.
BPCL, HPCL & GAIL walk away with city gas licenses in latest bid round
State-owned Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation Ltd (HPCL) have bagged two licenses each for retailing CNG to automobiles and piped cooking gas to households in the latest bid round, regulator PNGRB said on Wednesday, April 27.
Seven companies had put in 21 bids for city gas licences in five areas in states like Uttar Pradesh and West Bengal.
The Petroleum and Natural Gas Regulatory Board (PNGRB) had offered 5 Geographical Areas (GAs), spread over 27 districts in five states, in the 11A city gas distribution (CGD) bid round.
BPCL won the license for a GA comprising districts such as Lakhimpur Kheri, Sitapur and Mahrajganj in Uttar Pradesh and another for Chhattisgarh’s Koriya, Surajpur, Balrampur and Surguja districts have been clubbed into one GA, PNGRB said in a statement.
HPCL won the license for a GA made up of Banka in Bihar as well as Dumka, Godda, Jamtara and Pakur districts in Jharkhand. It also won the license for GA made up of Birbhum, Murshidabad, Malda and Dakshin Dinajpur districts of West Bengal.
GAIL Gas Ltd, a unit of state gas utility GAIL, won the license for the Kodagan, Bastar, Sukma, Bijapur and Dantewada districts in Chhattisgarh. “Letter(s) of Intent to successful bidders for the 5 GAs has been issued on April 27, 2022,” the PNGRB noted.
New push to develop city gas distribution network
Petroleum and Natural Gas Regulatory Board (PNGRB) in its 111th board meeting held on 27 April 2022 has approved issuance of letters of intent (LoI) to the three successful entities for retailing CNG to automobiles and piped cooking gas to households in five geographical areas (GAs), spread over 27 districts in five states.
State-owned Bharat Petroleum Corporation Limited (BPCL) won the licence for a GA comprising Lakhimpur Kheri, Sitapur, Bahraich, Shrawasti, Balrampur, Siddharth Nagar & Maharajganj districts in Uttar Pradesh and the GA comprising Koriya, Surajpur, Balrampur and Surguja districts of Chhattisgarh.
Policy Matters/ Gas Pricing/ Others
CNG sales increase by over 9% in Patna
With the state government banning diesel-run autorickshaws and old buses in the city, sales of compressed natural gas (CNG) have increased by 9.1%. Many vehicle owners have also shifted to CNG due to the rise in prices of petrol and
diesel. According to the data available with Gas Authority of India Limited (GAIL), the sole supplier of CNG in Patna, the sales of cleaner fuel in the city have increased from 50,000-55,000kg per day in March to 60,000kg per day now.
The CNG is being sold at Rs 72.96 per kg in Patna, after a hike of Rs 3 on April 1. The GAIL is hopeful that the daily consumption of cleaner fuel will further go up as more CNG buses and autorickshaws will hit the roads in coming days. Besides, the private operators are also replacing diesel-run minibuses with CNG buses. Six companies in Patna are currently allowed to retrofit petrol and diesel cars with CNG kits. Altogether 19 CNG stations have been functional in Patna district and one more will come up at Anisabad within a month.
Centre considers delinking oil, gas extraction from mining tag
The MoPNG is seeking a separate category of clearance for oil and gas because if it is considered a mining activity, the environmental norms may prove to be more stringent.
The Union environment ministry is considering a proposal to delink oil and gas extraction from mining projects, as far as environmental appraisal is concerned. If approved, oil and gas extraction will not be considered a mining activity anymore.
According to the people cited above, the ministry of petroleum and natural gas (MoPNG) has requested the environment ministry to create a separate category for appraisal of oil and gas projects on their Parivesh portal, where various environmental clearances are processed.
The minutes of a Forest Advisory Committee (FAC) meeting on March 31 said while the panel has deferred its decision on the matter, it maintained that extraction of natural gas and petroleum is not mining as per interpretation of a 2006 Supreme Court order. The MoPNG is seeking a separate category of clearance for oil and gas because if it is considered a mining activity, the environmental norms may prove to be more stringent, an official in the ministry said.
The issue of delinking hydrocarbons from mining projects was first considered by a standing committee of NBWL in 2018 while dealing with a proposal related to Tripura, where it was decided that the Tripura government should obtain the opinion of its advocate general (A-G) in the matter.
VGL hikes domestic PNG rates again
Vadodara Gas Ltd (VGL) has decided to hike rates of piped natural gas (PNG) supplied to domestic consumers in the city by Rs 8.05. This is the second hike slapped by the city gas distribution company within a month. VGL has decided to raise domestic PNG tariff from the existing Rs 35.65 per cubic metre to Rs 43.70 per cubic metre.
The tariff will be effective from April 1. Earlier, on March 25, VGL had hiked the rates of domestic PNG from Rs 29.61 per cubic metre to Rs 35.65 per cubic metre. VGL is a joint venture city gas distribution company floated by Gail Gas Ltd and the Vadodara Municipal Corporation. Its decision to hike the tariff will affect around two lakh consumers in the city. According to VGL, the prices of gas made available to it under the administrative price mechanism (APM) have been hiked by the government. Also, the quantity of gas available under APM was lower forcing the company to hike gas prices.
Electric Mobility/ Hydrogen/ Bio- Methane
India’s first pure green hydrogen plant was commissioned in Jorhat
Oil India Limited (OIL) has taken the first significant step toward the Green Hydrogen Economy in India with the commissioning of India’s First 99.999% pure Green Hydrogen pilot plant, with an installed capacity of 10 kg per day at its Jorhat Pump Station in Assam on April 20. The plant was commissioned in a record time of 3 months.
Shri Sushil Chandra Mishra, Chairman & Managing Director, inaugurated the plant in the presence of Shri Harish Madhav, Director (Finance) and Shri Prasanta Borkakoty, Resident Chief Executive of the company. The plant produces Green Hydrogen from the electricity generated by the existing 500kW Solar plant using a 100 kW Anion Exchange Membrane (AEM) Electrolyser array. The use of AEM technology is being used for the first time in India.
Speaking on the occasion, Shri Mishra said that the company has taken an important step towards fulfilling the vision of our Prime Minister for an atmanirbhar India. This plant is expected to increase its production of green hydrogen from 10 kg per day to 30 kg per day in the future. The company has initiated a detailed study in collaboration with IIT Guwahati on blending of Green Hydrogen with Natural Gas and its effect on the existing infrastructure of OIL. The company also plans to study use cases for commercial applications of the blended fuel.
No problem in Tesla producing EVs in India but must not import vehicles from China: Gadkari
Union minister Sh. Nitin Gadkari on Tuesday, April 26, said if the US-based Tesla is ready to manufacture its electric vehicles in India then there is ‘no problem’ but the company must not import cars from China. In an interactive session at the Raisina Dialogue, Sh. Gadkari further said India is a large market and there is a huge potential for all electric vehicles.
“If Elon Musk (Tesla CEO) is ready to manufacture in India then there is no problem … Come to India, start manufacturing, India is a large market they can export from India, but if he wants to manufacture in China and sell in India, then it cannot be a good proposition for India,” Sh. Gadkari said. The road transport and highways minister said his request to Musk is to come and manufacture in India.
At present, cars imported as completely built units (CBUs) attract customs duty ranging from 60-100 per cent, depending on engine size and cost, insurance and freight (CIF) value less or above USD 40,000.
Natural Gas / Transnational Pipelines/ Others
New gas pipeline boosts Europe’s bid to ease Russian supply
Mountainous and remote, the Greek-Bulgaria border once formed the southern corner of the Iron Curtain. Today, it’s where the European Union is redrawing the region’s energy map to ease its heavy reliance on Russian natural gas.
A new pipeline built during the COVID-19 pandemic, tested and due to start commercial operation in June would ensure that large volumes of gas flow between the two countries in both directions to generate electricity, fuel industry and heat homes.
In the short term, it’s Bulgaria’s backup. The new pipeline connection, called the Gas Interconnector Greece-Bulgaria, will give the country access to ports in neighbouring Greece that are importing liquefied natural gas, or LNG, and also will bring gas from Azerbaijan through a new pipeline system that ends in Italy.
It’s one of many efforts as EU members scramble to edit their energy mixes, with some reverting back to emissions-heavy coal while also planning expanded output from renewables. The European Union wants to reduce its dependence on Russian oil and gas by two-thirds this year and to eliminate it completely over five years through alternative sources, the use of wind and solar power, and conservation.
Russia’s invasion of Ukraine is likely to accelerate changes in the EU’s long-term strategy as the bloc adapts to energy that is more expensive but also more integrated among member nations, said Simone Tagliapietra, an energy expert at the Brussels-based think tank Bruegel.
On the ground, the project faced multiple holdups because of supply chain snags during the COVID-19 pandemic. Receiving specialized parts and moving personnel after construction got underway in early 2020 soon became increasingly difficult, said Antonis Mitzalis, executive director of Greek contractor AVAX, which oversaw the project.
Construction of the pipeline finished in early April, he said, while work and testing at two metering stations and software installation are in the final stages.
Russia’s oil giant confirms pumping natural gas to Europe via Ukraine as requested
Russian energy giant Gazprom says it is meeting supply requests for natural gas from European importers, pumping over 57 million cubic meters (2 billion cubic feet) through Ukraine on Sunday, April 17.
Gazprom’s transit contract with Ukraine caps the daily volume of gas at around 109.6 million cubic meters, or 40 billion cubic meters until the end of 2022. Despite Russia’s military operation in Ukraine, the levels of gas transit were quite steady from February 24 until mid-March, when slight drops were registered for a couple of days. Since April 8, gas transit has been lower than expected again, which may be put down to warmer temperatures in Europe.
Global LNG Development
Germany: World’s second largest bio-LNG plant for vehicles under construction
Wärtsilä will supply equipment for the world’s second largest plant capable of liquefying biomethane and synthetic methane from renewable energy sources to produce carbon-neutral transportation fuel. When operational it will have a capacity of approximately 63,000 tons bio-LNG per year.
The contract was placed in March 2022 by the German energy company REEFUELERY GmbH a joint venture of Erdgas Südwest GmbH and avanca, a company focused on sustainable energy and logistics solutions.
The facility, expected to become fully operational during the first quarter of 2024, will be located in Burghaun near Fulda, Germany. Burghaun was chosen as the preferred location for this project due to its direct access to the MIDAL, one of the most powerful gas pipelines in Germany. The central location enables optimum supply to the Alternoil filling stations – owned by the avanca group.
The plant will utilize biomethane from communal and agricultural waste materials as feedstock. The biomethane is subsequently liquefied and delivered to the Alternoil filling station network as the climate-neutral fuel REEFUEL (bio-LNG).
South Korea: KOGAS Signs Long-term LNG Import Contract with BP
Korea Gas Corp. (KOGAS) has signed a long-term U.S. LNG sale and purchase agreement (LNG SPA) with BP p.l.c, a comprehensive energy company. KOGAS will import 1.58 million tons of Henry Hub-linked LNG per year for up to 18 years from 2025.
A signing ceremony was held at BP headquarters in London on April 21 (local time), with the attendance of representatives of the two companies including Chae Hee-bong, president of KOGAS and Ms. Carol Howle, executive vice president of trading & shipping at BP.
KOGAS sealed the deal with BP Singapore Pte., a BP subsidiary in Singapore. BP was selected through an international tender organized by KOGAS in 2018 to secure a stable LNG supply. The two sides signed a head of agreement (HoA) in Sept. 2019.
Experts call this contract very advantageous for KOGAS in light of the recent rise in oil and international LNG market prices. They predicted that the contract will make a significant contribution to stabilizing natural gas prices in Korea in the future.
Gasum puts into operation first LNG station in Southeast Finland
Gasum has opened a new LNG station in Jylpyntie 38, Kotka. This is first service station offering LNG and bio-LNG in Southeast Finland and the second in Kotka providing bio-CNG. The facility is in the proximity of the busy highway 7,
a prime location at the entrance to the port, and serves both passenger car drivers and logistics and haulage companies’ trucks. The Port of Kotka is Finland’s largest export port, which means the area has an important role in logistics.
Demand for bio-LNG has been growing sharply across Europe. In 2020, there were already more than 15,000 bio-LNG vehicles on the roads and this number is expected to show further strong growth. Gasum promotes the transition to a low-emission society by providing logistics companies and consumers with possibilities to switch from traditional fossil fuels to greener alternatives. Renewable biogas accounts for more than 90% of the road fuel gas sold by Gasum. The EU’s Connecting Europe Facility supported the construction of the LNG station in Kotka.
China signed record high 22.7 mil mt of LNG term contracts in 2021: CNPC ETRI
China signed a record high 22.7 million mt of LNG term contracts in 2021, up 516% year on year, with some contracts starting delivery in 2022, which will boost LNG imports in coming years, state-owned oil and gas company CNPC’s Economics & Technology Research Institute, or ETRI.
ETRI said China’s natural gas imports in 2022 are forecast to reach a total of 185 Bcm, up 10.1% year on year, supported by incremental volumes through the Russia-China natural gas pipeline’s eastern route and the commissioning of new LNG terminals such as Zhangzhou and Binhai LNG terminals.
China has increased its pipeline gas imports from Russia to 43 million cu m/day or around 15 Bcm/year since December 2021, and the volume is expected to further increase with more pipeline facilities completing constructions, ETRI said, noting that the total length of China’s long-distance natural gas pipeline has reached nearly 84,000 km as of 2021.
China overtook Japan to become the world’s biggest LNG importer in 2021, and its total LNG receiving capacity has reached 91.3 million mt/year by the end of the year, according to ETRI. China’s natural gas production is expected to reach 221.6 Bcm in 2022, up 6.2% on the year, slightly higher than the target of 214 Bcm for 2022 set by the National Energy Administration in its work guidelines released on March 29.
China’s natural gas production was 208.6 Bcm in 2021, including 23 Bcm of shale gas, 10.5 Bcm of coal-bed methane and 4.6 Bcm of coal gas, up 16 Bcm or 8.3% year on year, according to ETRI. Domestically produced natural gas is expected to account for 55% of the country’s total natural gas supply, while imported LNG and pipeline gas are estimated to account for 30% and 15% of the total supply in 2022, respectively.
China’s natural gas demand is also expected to grow by 8.2% in 2022, slowing from 12% in 2021, with the largest growth coming from the power generation and industrial sectors, as the country adds around 10 GW of new installed gas power generation capacity this year, ETRI said. China has relaxed the coal-to-gas switching policy in rural areas, while natural gas demand growth is expected to be dampened by tighter COVID-19 restrictions this year.
Antigua: INOXCVA scores Caribbean LNG terminal contract
Indian cryogenic equipment company INOXCVA has won a design and engineering contract by Caribbean LNG for a mini-LNG receiving and regasification terminal in Antigua.
Caribbean LNG is a joint venture between Eagle LNG Partners and Antigua Power Company (APC). The parties formed the JV specifically for the development of the Antigua LNG receiving terminal to deliver low-carbon fuel to the Eastern Caribbean.
The terminal will provide LNG for APC’s on-island 40-megawatt power plant. The terminal is to be a future template and anchor plant to service power and other energy requirements in the Eastern Caribbean Islands.
This project comes soon after the commissioning and operations of a similar multifunctional mini-LNG terminal set up by INOXCVA in Scotland.
Turkey to extend incentives for $10B Black Sea gas field development
Turkey will be extending government support for the massive project to develop the natural gas field it discovered in the Black Sea, according to a presidential decree Wednesday.
The state energy company Turkish Petroleum Corporation (TPAO) project will be provided tax cuts, the country’s Official Gazette said. The project’s total fixed investment stands at around TL 145.1 billion ($9.9 billion) and will last for 11 years.
Turkey is building an industrial complex that will process the gas the country discovered in the Sakarya gas field, located some 150 kilometers (93 miles) off the coast of Turkey in the Black Sea. The facility is expected to be operational in the first quarter of 2023. The country’s first drilling vessel, Fatih, has discovered 540 billion cubic meters (bcm) of gas in the Sakarya gas field since August 2020.
Turkey is fully dependent on gas imports, mainly from Russia, but the Sakarya field is expected to reduce those imports by about a quarter once it reaches peak production. Ankara plans to begin pumping gas from the southwest Black Sea field in 2023 but must first build an offshore pipeline network and processing facilities. The first phase of construction of the Western Black Sea Natural Gas Pipeline section will be carried out in two stages.
Malaysia: MoU signed on RM8.8b floating LNG facility
Petroliam Nasional Berhad (Petronas) and Sabah Oil & Gas Development Corporation Sdn Bhd (SOGDC) signed a Memorandum of Understanding (MoU) to build Sabah’s first and largest near-shore floating liquefied natural gas (LNG) facility known as ZLNG project at Sipitang Oil and Gas Industrial Park.
With an estimated investment value of RM8.8 billion, the signing strengthened the existing close collaboration between Petronas and SOGDC towards materialising the project which is currently under the Front-End Engineering and Design (FEED) stage and targeted to complete Final Investment Decision (FID) at end of this year.
Deputy Chief Minister cum Industrial Development Minister Datuk Dr Joachim Gunsalam witnessed the signing ceremony held at Le Meridien Kota Kinabalu subsequent to the adjournment of the 4th Joint Technical Meeting of the ZLNG project.
LNG Assets, Gas Business Vice-President Abang Yusuf Abang Puteh signed on behalf of Petronas, while the Permanent Secretary of the Industrial Development Ministry cum Director of SOGDC, Thomas Logijin, signed on behalf of SOGDC, witnessed by SOGDC Managing Director cum Chief Executive Officer Abdul Kadir Abdullah.
Petronas and SOGDC will collaborate and cooperate in realisation of the project that includes SOGDC’s support and commitment to assist Petronas in securing all necessary approvals, permits and/or utilities as Sogip developer.
The floating LNG facility will create multiple spin-offs for the State. It will unlock potential future businesses such as tank regional distribution and bunkering and potentially provide return to participating parties and expand LNG Virtual Pipeline System (VPS) in Sabah. LNG VPS, which leverages the LNG plant, will enable Sabah to extend gas use within the State, especially in the East Coast region.
Italy’s Eni have signed LNG deal with the Republic of Congo
The deal allows Eni to increase gas production, primarily through the development of an LNG project, in Congo. Italian oil and gas company Eni has agreed to increase gas production and exports from the Republic of Congo by more than 4.5 billion cubic metres (bcm) a year.
The deal is part of the Italian firm’s plan to reduce dependence on Russian gas in the wake of Moscow’s military action against Ukraine. Eni currently supplies gas to the Congo Power Plant (CEC), which accounts for 70% of the electricity produced in the country.
Earlier this month, Eni signed a deal with the Egyptian Natural Gas Holding Company (EGAS) to increase the gas production and supply to Europe. The framework agreement aims to promote gas export from Egypt to Europe, and specifically to Italy, to help transition to a low-carbon economy. The deal comes as European nations search for alternative gas supplies to cut their dependence on Russian gas, following the invasion of Ukraine.
Technological Development for Cleaner and Greener Environment Hydrogen & Bio-Methane
Greece to upgrade only LNG terminal in preparation for energy supply disruptions
Greece’s only liquefied natural gas (LNG) terminal on the islet of Revithoussa near Athens will be upgraded as the country is preparing its energy system for the worst-case scenario, such as a complete cessation of natural gas supplies from Russia, Greek Prime Minister Kyriakos Mitsotakis said on Tuesday, April 19.
Managed by the Hellenic Gas Transmission System Operator (DESFA), the Revithoussa terminal is currently the only one in Greece that receives, temporarily stores and regasifies LNG and supplies the country’s National Natural Gas Transmission System. Its LNG storage capacity is currently 225,000 cubic meters and can regasify 1,250 cubic meters per hour, according to the DESFA.
In the coming months, the DESFA is planning to add a floating storage unit to the existing facilities, which will increase storage capacity to 380,000 cubic meters, and the regasification capacity will be increased by 12%, among other investment plans, company officials said.
In 2021, 31.8% of Greece’s total natural gas imports entered the country through this facility. In the first three months of this year, the respective figure was 43.23%. LNG cargoes arrived from six countries (the United States, Algeria, Nigeria, Egypt, Oman and Indonesia), according to DESFA data.
For years, approximately 40% of Greece’s annual energy needs have been covered by imported Russian natural gas, according to the Ministry of Environment and Energy.
U.S. biomethane vehicle projects grow 85% in two years
Made from organic waste, renewable natural gas is rapidly gaining ground as an alternative fuel source with the potential to significantly reduce greenhouse gas (GHG) emissions. Public and private interest in this low-carbon fuel has grown dramatically in recent years, said
Marianne Mintz, principal transportation systems analyst at the U.S. Department of Energy’s Argonne National Laboratory.
Argonne maintains a database that provides a comprehensive list of projects, currently in operation or under construction, which upgrade biogas for pipeline injection or on-site dispensing as vehicle fuel. Along with the nonprofit Energy Vision, Argonne has tracked these projects for the past five years, recording sustained, rapid growth. Data shows that between 2019 and 2021, the number of projects that are operational, under construction or planned for transportation increased from 219 to 402 total projects, which is an 85% increase.
Biomethane aids the environment in two ways. Along with cutting GHG emissions from methane that would otherwise have been emitted, it can be used to fuel trucks that would normally burn fossil fuels. Vehicles are the largest source of the GHG emissions that trap heat in the atmosphere and warm the planet.
Argonne data shows that in 2021, the 230 operational biomethane facilities alone produced over 59 million MMBtus, the equivalent of over 459 million gallons of diesel, which is enough to fuel 50,000 refuse trucks. That growth represents a 30% increase in production capacity since 2020.
Growth in production and use of renewable natural gas is closely tied to federal and state incentives, which are expanding. For example, California awards credits through its Low Carbon Fuel Standard (LCFS), which focuses on reducing the carbon content of fuels used within the state. The Argonne database tracks biomethane projects by feedstock: food waste, landfills, livestock/agriculture and municipal wastewater. Most projects involve landfills, but all feedstock categories are growing. The potential for domestic production is estimated to be 10 to 20 times greater than current production.
Renewable natural gas is just one piece of the overall decarbonization strategy not the entire solution.
Currently, renewable natural gas is primarily used as a substitute for conventional natural gas which itself is a substitute for diesel in heavy-duty vehicles. While electric cars are now a viable, clean-energy solution, heavy-duty trucks will take longer to successfully electrify, making biomethane a good fuel for near-term decarbonization in large vehicles.
Spain: Madrid expands PTV biogas plant, will be able to supply 500 EMT buses
At the Valdemingómez Technology Park (PTV), the Mayor of Madrid José Luis Martínez-Almeida launched the expansion of the facility where biogas from organic matter is transformed into biomethane, “a good example of proper waste management”.
The reform of this infrastructure began in July 2021 and has now been completed after nine months of works. Until now, the plant injected up to 100 GWh/year of thermal energy. The increase in its capacity will make it possible to inject 80% more of this renewable gas into the gas network, that is, it will increase the energy injected to 180 GWht, which also means the reduction of more than 43,500 equivalent tons of CO2 per year.
The work, carried out and financed by PREZERO (the plant’s operating company), had a total budget of €6.9 million, of which €656,000 were subsidized by the European Union within the framework of the first call for aid to investment in thermal energy production facilities from renewable energy sources that are financed by the European Regional Development Fund (ERDF).
The project contributes to the achievement of the objectives set in the National Integrated Energy and Climate Plan 2021-2030 (PNIEC) on the participation of renewable energies in the final use of energy, which is established at 42% by 2030. Likewise, The Madrid 360 Environmental Sustainability Strategy is based on measures that promote the circular economy to contribute to the fight against climate change.
The PTV biomethane complex consists of two anaerobic digestion plants, Las Dehesas and La Paloma, which produce two materials from the organic matter of the waste: biogas and digestate.
The biogas is purified at the now expanded biogas treatment plant, which transforms it into biomethane and injects it into the gas network, and can be used for the same uses as natural gas (boilers, refueling of buses, trucks, cars, industrial use), but with a renewable or green origin. The digestate is subjected to a composting process to obtain organic amendments or fertilizers for the soil (compost). This treatment is carried out at the La Paloma Plant.
In May, the Madrid City Council will start work on a new plant to expand the organic treatment capacity with a budget of €42 million.