A greener gas grid: 6 key findings

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Jamie Speirs, Sustainable Gas Institute, Energy Analysis and Policy Lead, Imperial College London
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A new white paper produced by researchers at the Sustainable GAS Institute (SGI) at Imperial College reviews evidence on low-pressure gas networks, which is the part of the infrastructure that supplies homes and businesses with natural gas. The researchers investigate switching this network to other gasses such as biomethane and hydrogen, which can be produced with reduced C0₂ emissions. Here are the report’s key findings:

1. Gas networks could play an important role in decarbonising the future energy system: There are significant benefits to decarbonising the gas network such as maintaining the value of the existing assets, and in the inherent flexibility of gas. There is also a general consumer preference for gas appliances; and it is relatively low cost and easy to install gas-fired heating systems. However, the technical capabilities of existing networks, and the level of decarbonisation achievable, still need to be explored, and resulting costs remain uncertain.

2. The storage potential of low carbon gas offers a significant advantage over electricity networks: Gas has relatively low-cost flexibility, particularly for seasonal fluctuations in energy demand. Future decarbonised gas also has this flexibility but this is more technically challenging and expensive for an electricity system. Per kilowatt-hour the cheapest forms of electricity storage are approximately four times more expensive than the highest cost estimates for hydrogen storage (salt caverns). However, the value of this flexibility is unclear and depends on the future balance of decarbonised gas and electricity demand.

3. Decarbonised gas offers a range of advantages, but there is no ‘best option’: Biomethane is the most compatible with existing gas networks and may deliver negative emissions. However, there are limitations on the future availability of biomass, used to generate biomethane. Hydrogen could be delivered through electrolysis from renewable energy without the need for carbon capture and storage (CCS). However, electrolysis is currently expensive relative to other methods, although it is likely that costs will decrease. Using natural gas to generate hydrogen in SMR could increase gas demand by 15% to 66% per unit of energy delivered to consumers, relative to direct use of natural gas.

4. The range of CO2 emissions estimates for the different methods to produce low carbon gas is extremely large: This is -371 to 642 gCO2eq/kWh  for hydrogen and -50 to 450 gCO2eq/kWh  for biomethane. Converting fossil fuels to hydrogen without CCS is likely to produce carbon intensities greater than current gas networks. Emissions estimates for SMR with CCS are between 23 to 150 gCO2eq/kWh, while for electrolysis using renewable electricity sources the range is from 25 to 178 gCO2eq/kWh. The carbon intensity of heat might be between 26 and 167 gCO2eq/kWh for methane based hydrogen and 27 to 198 gCO2eq/kWh for hydrogen from electrolysis, assuming a 90% efficient hydrogen boiler. Heat pumps with 250% efficiency using the same electricity might deliver heat with a CO2 intensity of 10 to 71 gCO2eq/kWh.

5. The cost estimates for different decarbonised gas options vary significantly: The resulting retail price estimate for biomethane might be 4.4 to 13.6 p/kWh (average 8.1 p/kWh) compared to an estimate for hydrogen of 4.9 to 18.4 p/kWh (average 9.3 p/kWh). This can be compared to an EU average retail price in 2015 for natural gas of 5.4 p/kWh, and electricity at 17p/kWh. Prices are in pence per kilowatt hour [p/kWh]. If the future efficiency of methane or hydrogen-fired boilers is 90%, the costs of delivered heat ranges from 4.9 to 15.1 p/kWh heat for biomethane and 5.4 to 20.4 p/kWh heat for hydrogen. For comparison, at heat pump efficiencies of 250% and a retail electricity price of 17 p/kWh, heat pumps could produce heat for 6.8 p/kWh. Converting consumers to hydrogen gas networks may cost over £3,000 per household including appliances and supporting equipment. This can be compared to the cost of installing air source heat pumps at between £4,000 to £11,000 or ground source heat pumps at £13,000 to £20,000.

6. Countries with mature gas networks may find decarbonisation options attractive given the value of their existing assets (e.g. Netherlands, UK andUSA): Existing low-pressure gas networks are compatible with biomethane, and the cost of converting networks to carry hydrogen is expected to be small relative to total system  costs.. Where low-pressure gas distribution networks are very small or non-existent the cost of building may be significant, but not prohibitive. For example, to build a new hydrogen low-pressure distribution network similar in length to the networks existing in the UK or Japan might cost £145 billion. Spread over 20 million domestic gas consumers (UK) this is £7,250 per household, which is similar to the cost of installing air or ground source heat pumps. This can be compared to an estimated cost for repurposing an existing natural gas network of the same length to transport hydrogen of £2 billion or £10,000 per km.

To know more about decarbonising the world’s gas grids, please download the full report here.

Image courtesy of Imperial College