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Energy Currents
A Blog by Enerdynamics

Can Natural Gas Utilities Be Part of the Decarbonization Solution?

by Bob Shively, Enerdynamics President and Lead Facilitator

“The natural gas industry is committed to reducing greenhouse gas emissions through smart innovation, new and modernized infrastructure and affordable energy choices for customers. Building successful pathways to net-zero emissions will require a combination of tools and strategies.”

~ American Gas Association

While the natural gas industry has tried to position itself as providing a bridge fuel to a sustainable future, many climate activists view natural gas as an important contributor to the climate change problem. Some U.S. cities have banned gas connections for new residential construction, and gas buyers in Europe and Japan are insisting that sellers of natural gas supply demonstrate tangible actions to reduce the carbon footprint of their volumes. Many gas utilities feel that their once-stable business models are threatened with a future of shrinking throughput driven by government policies and customers choosing electrification.

In response, some gas utilities have announced their own decarbonization plans. The nation’s largest gas distribution utility, SoCalGas, announced in 2021 a commitment to achieve net zero greenhouse gas (GHG) emissions by 2045. This includes not only emissions associated with SoCalGas’ operations but also downstream emissions associated with its customers. According to the SoCalGas Newsroom, initial efforts will focus on SoCalGas’ own operations and on displacing some existing gas supply with growing amounts of renewable natural gas and hydrogen. Here is SoCalGas’ plan through 2035:

By 2025:

  • Achieve net zero energy for 100% of SoCalGas’ newly constructed buildings and major renovations of buildings over 10,000 square feet
  • Replace 50% of SoCalGas’ over-the-road fleet with electric, hybrid, natural gas, and/or fuel cell electric vehicles
  • Establish statewide hydrogen blending standards
  • Complete five hydrogen pilot projects
  • Increase procurement of responsibly sourced gas

By 2030:

  • Eliminate 100% of vented gas during planned transmission pipeline work
  • Achieve net zero energy for 50% of all SoCalGas existing buildings
  • Deliver 20% renewable natural gas
  • Establish a hydrogen industrial cluster working with industry partners

By 2035:

  • Operate a 100% zero emissions over-the-road fleet
  • Achieve net zero energy for 100% of SoCalGas buildings

Beyond 2035, SoCalGas will depend on less-proven methods such as more extensive production and use of green hydrogen as well as carbon capture and storage of emission from gas consumers.

To assist gas utilities in developing their own decarbonization plans, the American Gas Association recently released a study by ICF consulting titled Net-Zero Emissions Opportunities for Gas Utilities. The study lays out a range of scenarios and technology opportunities available for gas utilities to contribute to emissions-reduction goals. Options found include:

Reducing fugitive methane emissions through advanced pipeline repair, replacement, and methane leak detection
  Fostering reduced emissions from end users through expanded gas utility efficiency programs, building upgrades, gas heat pumps, district heating, combined heat and power (CHP), and high-efficiency equipment
Purchasing differentiated gas such as certified low-methane gas supply provided by producers who reduce methane emissions in their production operations
Increasing amounts of renewable natural gas (RNG) in the gas supply
Blending green hydrogen into gas supplies or constructing dedicated hydrogen infrastructure
Fostering use of carbon capture technologies to reduce GHG emissions from end uses

The next decade will prove a critical time for gas utilities as they either become a part of the decarbonization solution or become a shrinking factor in our nation’s energy supply. Now is the time for gas utilities to work diligently to transition for success in the future.  

Learn more about the future of the utlity in Enerdynamics' live or live/virtual seminar titled The Future of the Utility: Evolving Customers, Changing Technology, Revised Regulation, New Business Models, and Growing Opportunities. Call 866-765-5432 ext. 700 or email for more details on bringing this seminar to you!

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utility business , GHG , Greenhouse gas , Natural gas industry ,