Renewable Natural Gas Has a Way to Go, but Interest Is There

There is no shortage of ideas when it comes to mitigating climate change and carbon emissions, they range from policy devices to cleaner technologies. The most popular are carbon taxes, solar PV, and wind. Fewer know about carbon capture and hydrogen, but some of the hype around those pathways is legitimate. Even fewer know the benefits of renewable natural gas (RNG)—closely related to biogas—or what it is. Absent a complete shift to electrification, biogas has significant potential to be a core piece of the climate change puzzle. This is because biogas uses waste that would have been emitted as CO2 and methane and can be used to displace fossil fuels in both power generation and transportation.

What Is It?

As there are a variety of terms thrown around in the energy space, one would not be blamed for not knowing the differences between terms like biomass, biogas, and synthetic natural gas despite them being different but linked concepts. Biogas is the result of organic materials being broken down by bacteria in an oxygen-free system, a process known as anaerobic digestion. While this process occurs naturally in everyday life, biogas production is optimized by using an anaerobic digester. 

The major sources of organic material are landfills and waste production facilities, like livestock facilities and wastewater treatment facilities. The US currently has more than 2,000 operational biogas systems across the country, with the potential to add 13,500 more. 

What Is Happening?

An increasing amount of companies and utilities around the world are beginning to realize the value of RNG. Natural gas utilities are especially exploring RNG as pressure continues to mount from regulators to curtail carbon emissions. In 2018, Guidehouse completed a project for Southern California Gas (SoCalGas), a utility serving over 21 million people, to explore the RNG opportunities. SoCalGas is not the only utility taking initiative. DTE recently entered a partnership with several Wisconsin dairy farms to use their waste for RNG production. The derived RNG is then injected into the grid at DTE’s Newton facility.

In addition to exploration by utilities, companies and other entities are also beginning to enter the RNG fray. Trondheim, Norway added 189 biogas and biodiesel MAN Lion's City buses to its public transportation fleet in mid-September. Delta Air Lines announced several weeks ago that it is investing $2 million to conduct a feasibility study for a biofuels production facility. Keeping in line with aviation, the Seattle-Tacoma International Airport is aiming to be the first airport to be heated entirely by RNG. 

Tempering Expectations

RNG does have the potential to reduce overall emissions, but it is not an end-all-be-all solution for decarbonization. The current volume of RNG in the US is not enough to make a significant impact. Outside of the lack of volume, it is difficult to make the project economics work without substantial policy support. Financial hurdles include high capital costs, pipeline interconnection costs for grid-injection purposes, and an overall lack of incentives.

RNG evidently has a way to go to be implemented at scale, but the growing interest and investment is almost certainly expected to lead to greater levels of RNG project development. To what extent this investment grows is largely a function of what sort of policy support RNG can receive and how quickly costs can be reduced to become a cost-effective alternative fuel in the age of decarbonization.