Australia is on a pathway to decarbonise the gas sector to help meet its emission reduction commitments, which can be achieved through the widespread deployment of transformational technologies including biogas, hydrogen and carbon capture and storage. Industry has responded by leading the development of research projects to demonstrate how existing gas infrastructure can play a key role in balancing energy affordability, energy security and environmental outcomes.

While most of the net-zero targets have been focused on reducing emissions from electricity use, attention has also turned to what leadership in reducing emissions from gas use looks like.

As the largest gas distributor in New South Wales – supplying more than 1.4 million homes, businesses and industrial customers – and the owner of some of Australia’s most important gas transmission pipelines, Jemena is wellplaced to initiate the transition to renewable gas and a more sustainable energy future.

Jemena Executive General Manager of Energy Networks, Shaun Reardon, said the utility sees a future where gas follows its own pathway to decarbonisation through the commercialisation of renewable gases such as hydrogen and biomethane, while continuing to play a crucial role in Australia’s energy system.

“Gas provides firming fuel for other renewable technologies such as wind and solar which aren’t available when the sun doesn’t shine or the wind doesn’t blow,” Mr Reardon said.

“We also know that those industries which are hard to abate and difficult to electrify, such as manufacturing, will continue to rely on gas as a feedstock for their operations. “In addition to these domestic functions, gas will play an important role on the global stage as it replaces coal in developing economies.

“With this in mind, we’re excited about the prospects of a renewable gas export industry and believe Australia is well-placed to develop and benefit from such an industry.”

As the name suggests, renewable gas is made from renewable sources, for example, solar energy and organic waste. Jemena is investing in several renewable gas initiatives, which includes significant trials and development work in:

• Biomethane, which can be produced and captured from organic and agricultural waste

• Hydrogen, produced through a process of electrolysis which uses renewable energy sources, like solar and wind, to split hydrogen from purified water, creating a fuel source

Renewable gas can be easily blended into the current natural gas network, and then distributed to homes, businesses and communities using existing infrastructure, saving billions of dollars of investment. Hydrogen can even be used in the transport sector as an alternate fuel type.

In April 2021, Jemena announced its ambition to achieve net zero emissions by 2050, followed by a statement in May calling for a Renewable Gas Target as a means of stimulating a renewable gas industry.

Jemena’s Managing Director, Frank Tudor, said a Renewable Gas Target would likely replicate the success of the Renewable Energy Target (RET), which helped to spur the development of renewable technologies in the electricity sector.

“This is the jump-start the gas sector needs to truly commercialise zero-emission gases such as hydrogen and biomethane and make them available to Australian homes and businesses at scale,” Mr Tudor said.

“By decarbonising our existing gas infrastructure, we can avoid unnecessarily building new alternative forms of energy infrastructure, which will have a significant impact on customer bills.

“In the short term, this will make the transition to a lowcarbon future seamless and means Australian homes and businesses can continue to use their gas stoves, heaters, and other appliances.”

Mr Tudor said a subsidy in the order of $3-15/GJ could facilitate the entry of significant amounts of renewable gas into Australia’s gas networks, and is much less than the subsidy offered under the RET to the electricity sector, which was the equivalent of $22/GJ.

“We believe a Renewable Gas Target could see up to 9PJs of zero-carbon gas injected into Jemena’s New South Wales gas distribution network by 2030. This would remove around 464,000 tonnes of carbon from the atmosphere each year – the equivalent of over 200,000 cars – and help New South Wales achieve a 10 per cent renewable gas target. Our initial analysis has found that this can be done at an estimated cost of around $15 for a typical NSW household.”

Mr Reardon added, “We believe that renewable gas not only provides a solution to the energy trilemma of reliability, affordability and  sustainability, but by injecting renewable gas into our existing gas infrastructure, Australian energy consumers will save between $12-14 billion per annum in ongoing capital and maintenance costs from 2050 (compared to full electrification).

“By keeping gas in our energy mix, we are also continuing to provide our customers with choice over how they power their lives, as well as ensuring that we are able to respond to changes in the energy market quickly and effectively.”

Integrating renewable gas into existing networks

For distribution networks such as Jemena, the renewable gas transition means working to develop new technologies to deliver fuel diversity to the market.

“Currently, we are working through a number of trials to understand the interaction between renewable gases and the existing gas grid,” Mr Reardon said.

“We believe that there is great opportunity for renewable gases to be blended into the existing gas network at different percentages and are particularly excited by the applicability of biomethane which can be injected into the gas grid at high levels without any infrastructure changes being required.”

The $15 million Western Sydney Green Gas project is a five-year trial that will convert solar and wind power into hydrogen gas, via electrolysis, which will then be stored for use across the Jemena Gas Network in New South Wales, the biggest gas distribution network in Australia. If the demonstration to power 250 homes and a hydrogen vehicle refuelling station is successful, Jemena will look to expand it across the NSW network.

The project is co-funded by Jemena and the Australian Renewable Energy Agency (ARENA) – the government agency’s largest investment in hydrogen technology to date.

As part of the project, Jemena purchased New South Wales’ first electrolyser which converts solar and wind power into hydrogen gas.

The 500kW electrolyser was developed in Belgium and Canada by Hydrogenics and was brought to Australia by renewable energy systems specialists ANT Energy Solutions.

Construction of the site commenced in early 2021 with the first green hydrogen produced in May 2021 as part of the electrolyser safety testing in the lead up to commissioning. Hydrogen will begin being blended into the Jemena Gas Network in New South Wales in the second half of 2021.

“Our customers are telling us they want to be able to continue to use gas for their cooking, heating and hot water, but they are also concerned about climate change and want the option to use zero-carbon and carbon-neutral technologies,” Mr Reardon said.

“The Western Sydney Green Gas project is a first step in understanding how hydrogen can be used at scale across the New South Wales gas distribution network. It is Australia’s most comprehensive renewable hydrogen demonstration project to date.”

The project will also support refuelling for public and private transport by making renewably-generated hydrogen available to the vehicle industry.

In August 2020, Jemena committed, through a Memorandum of Understanding with Hyundai Australia and Coregas, to produce and deliver hydrogen gas to Hyundai’s Macquarie Park headquarters in 2021. As part of the deal, Coregas will provide the compressor, pipework and connectors for filling and discharging hydrogen.

Fuel cell electric vehicles (FCEVs) combine hydrogen and oxygen to produce electricity, which runs the motor. With a range of approximately 650km, hydrogen-powered FCEVs can travel much further than pure electric vehicles.

Creating energy from waste

Jemena is also partnering with Sydney Water to generate biomethane at the Malabar Wastewater Treatment Plant in south Sydney.

This project will see biomethane blended into the gas network for the first time in Australia with an initial capacity of 95 TJ of renewable green gas per year, which is enough to meet the gas demand of approximately 6,300 homes.

This has the potential to be scaled up to 200 TJ per year, enough to meet the gas demand of around 13,300 homes. The $14 million Malabar Biomethane Injection Project is jointly funded by Jemena ($8.1 million) and ARENA, who provided $5.9 million in grant funding.

The Malabar Biomethane Injection Project will involve the use of a biogas upgrader facility which will process raw biogas from the Anaerobic Digestion (AD) plant at the wastewater treatment plant by removing non-methane gases, until the resultant gas stream meets the Australian Standard (A4564:2020) gas specification in preparation for injection into the existing gas network.

“Circular economy opportunities have the potential to create jobs, support business growth, and enhance energy security, with no impact to the network or customer appliances,” Mr Reardon said.

The facility is expected to produce the first biomethane for injection into the Jemena Gas Network in 2022. The project will also investigate renewable gas trading opportunities linking gas users with renewable gas production facilities. Such trading mechanisms would support a highly replicable ‘green gas’ market across other gas networks.

If successful, the project is expected to support wider uptake of biomethane technology by the Australian waste industry with the application expected to have broader application than just the wastewater treatment sector.

The Malabar Biomethane Injection Project will also demonstrate the first application of the recently announced Renewable Gas Certification Pilot – an initiative developed by Jemena, NSW renewable energy accreditor GreenPower, and Energy Networks Australia.

The pilot will be delivered by GreenPower over a minimum of two years and will inform the development of a permanent certification scheme for renewable gases.

“We are driving the call for a national certification scheme because our customers have told us they want certainty in their ability to purchase verified and accredited zero-emission gas just as is currently the case for renewable electricity,” Mr Reardon said.

“A national certification scheme will boost industry investment in renewable gases, such as biomethane and hydrogen and make them available to Australian homes and businesses.

“In the short term, it will mean our customers can lower their carbon footprint without making any changes to the way they currently use their gas appliances.

“In the long term, it will ensure gas remains affordable through the decarbonisation of existing gas infrastructure without the need for building new alternative forms of energy infrastructure. This is an important first step towards a Renewable Gas Target.”

Unlike hydrogen, which is not yet ready for wide-scale commercial use, anaerobic digestion is a ready-to-use technology that is already producing biomethane by recycling organic wastes.

When asked why all the hype around hydrogen when biomethane has better potential to decarbonise the gas supply and achieve net zero in the short term, Mr Reardon said, “We believe no technology should be taken off the table as a means of ensuring an efficient transition to a low-carbon future, and are working to understand where they are best applicable through our trials.

“Projects like our Western Sydney Green Gas project and biomethane trial are designed to understand exactly what percentages of renewable gases can be blended into the gas network and what the implications of doing this would be.

“While our projects are still in the development phase, we know from overseas experience that biomethane can be injected into the gas grid without requiring any infrastructure or appliance changes.

“Internationally, we’ve also seen hydrogen blended with biomethane and renewable gas at varying levels (some as high as 30 per cent) before network changes are required. As we commission the Western Sydney Green Gas project we will have a clearer understanding of local conditions.”

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