There’s no room for natural gas in a fully decarbonized future. But the European gas industry argues we should continue using natural gas infrastructure and vehicles because the European Union’s (EU) gas supply can be transformed to a fully renewable resource using biogas, power-to-gas, and hydrogen by 2050. In a recent working and briefing paper, we investigated whether this is possible.
Around half of current EU biogas production is from silage maize, a crop that competes for land with food and livestock feed and causes indirect land use change (ILUC) emissions. Renewable gas will only help decarbonize the EU economy if it is produced from low carbon feedstocks such as wastes and sustainably available residues. Figure 1 shows the lifecycle greenhouse gas (GHG) intensities of select renewable gas pathways, compared with natural gas. Biogas from livestock manure in particular offers very strong GHG benefits because using it for energy purposes avoids the natural release of methane, a potent climate forcer. The decarbonization potential of renewable gas in the EU thus depends on shifting current use of silage maize to wastes, residues, renewable hydrogen, and power-to-methane that does not displace renewable electricity in other uses.
Focusing on these sustainable pathways, we found limited potential for producing renewable methane in the EU, even looking out to 2050. There simply is not nearly enough cow manure, garbage, and agricultural residues to meet gas demand without relying heavily on the continued use of natural gas. Although renewable power-to-methane does not have the same biological production constraints as bio-waste feedstocks, this novel pathway faces steep economic headwinds and is unlikely to scale up significantly in the EU by 2050. Figure 2 shows that the maximum potential renewable gas production in 2050 by our estimates could displace only 12% of projected EU gas demand in 2050. If that entire resource is devoted to the transport sector, it could displace 7% of energy demand in that sector, or 10% of heat demands or 3% of energy demand for power generation.
Achieving the full technical potential of renewable methane would be very expensive, requiring high policy support. No renewable methane in our analysis will be cost competitive with fossil gas in 2050. This is particularly true for methane produced from livestock manure. Because most farms in the EU are located a significant distance from the gas grid, building a pipeline extension or trucking the gas to an injection point greatly increases the cost of delivering manure methane to end users. After taking into account these transport costs, along with capital, operating, and feedstock expenses for anaerobic digesters, gasification plants, and power-to-methane plants, we find that delivering 56% of the technical potential for renewable methane to the gas grid for use in the transport and heat sectors or 87% of the potential to on-site power generation would cost €4.20 per cubic meter (roughly comparable to €4.20 per diesel liter equivalent), compared to the current average EU wholesale gas price of only €0.20 per cubic meter. Even to deliver roughly half of the technical renewable methane potential would cost €1.70 per cubic meter, requiring a policy support level 7.5 times higher than the current market gas price. Realistically, it’s extremely unlikely European policy support will be high enough to incentivize use of the entire renewable methane resource.
Livestock manure accounts for roughly half the total technical potential in our analysis. Instead of delivering purified methane from manure to the gas grid, the raw biogas could instead be combusted in a boiler located at the farm, which could use the renewable power on-site and export any excess via a power grid connection. If livestock manure is used to produce electricity on-site, this renewable methane pathway will never use gas infrastructure or vehicles.
Another aspect that must be considered is competition for feedstocks from liquid fuel production. Many of the same feedstocks, including garbage and crop residues, can be used to produce drop-in diesel and gasoline. These pathways may be more competitive than producing methane because liquid fuels can be sold into a higher value market.
It’s very unlikely our ceiling of 12% of gas demand will actually become renewable by 2050. What happens if we invest now in maintaining gas infrastructure and expanding Europe’s gas vehicle fleet? We’ll get modest near-term air quality benefits from gas vehicles compared to diesel, but it won’t help us much on the road to decarbonization or to keeping global warming below 2 degrees Celsius. Natural gas pipelines and vehicles will still be largely using, well, natural gas, for as long as we can foresee.