The social impact of sustainable natural gasJanuary 18, 2016
Climex is seeing increasing demand for “sustainable natural gas”. The reality is, however, that the availability of sustainably generated natural gas is extremely limited and its price is correspondingly high. Additionally, there is a lot of misunderstanding about the product.
One potential interesting alternative is compensating the CO2 emissions from combustion of natural gas by supporting CO2 emissions reduction projects in developing countries.
This is an alternative that more and more energy companies are offering. But public and private-sector parties can also set up their own compensation schemes.
What is green gas?
Gas that is generated sustainably from renewables like livestock manure is called biogas. This gas can be upgraded to green gas by extracting its CO2 content until it has a caloric value comparable to the natural gas in the Dutch gas network.
There is a certification system for green gas in place that is used to verify that a given volume of gas was actually generated from sustainable sources. As in the sustainable electricity market, these certificates are called Guarantees of Origin (GOs). The availability of these GOs is however extremely limited and their price is correspondingly high, which makes them in practice not an attractive option for increasing the sustainability of gas consumption.
Another method of increasing the sustainability of natural gas use is to compensate the CO2 emissions associated with that consumption by purchasing CO2 certificates. These certificates, called Verified Emission Reductions (VERs), are issued by governmental agencies on the basis of reductions in CO2 emissions actually measured from projects in developing countries.
Examples of projects like this include electricity from wind farms, biomass installations, or projects distributing hyperefficient cook stoves that reduce CO2 emissions by dramatically reducing the fuel needed to run them. These projects can also have an impact in important social areas like health, education and infrastructure.
Organisations can retroactively increase the sustainability of their natural gas consumption through the purchase of these CO2 certificates. For more information, please contact the Climex Trading Department.