Sustainability champion heralds a decade of ‘exponential growth’ for RNG
RNG is key to decreasing our reliance on fossil fuels
The non-transport sector is beginning to heat up
Production costs will fall as demand grows
Towards the end of 2019, Michael T Bakas, Executive Vice President Distributed Energy Systems of Ameresco, a leading independent provider of comprehensive energy efficiency and renewable energy solutions for facilities throughout North America and the United Kingdom, was elected chair of the Coalition for Renewable Natural Gas’ (RNG Coalition) Sustainability Advisory Board.
The RNG Coalition advocates for the sustainable development, deployment and utilisation of RNG as a domestic, renewable, clean fuel and energy source in North America. As Chair of the Sustainability Advisory Board, Mr Bakas will lead the Advisory Board’s members to advise the organisation’s Executive Officers and Directors on sustainability policies, accounting and related opportunities to support the RNG Coalition’s mission and priority.
At the time of his appointment Mr Bakas said, “RNG is a renewable fuel readily available today that is interchangeable with traditional pipeline-quality natural gas without the need to modify any end use applications. Its widespread use is key to decreasing our reliance on fossil fuels and, in turn, meeting our societal carbon reduction goals. With RNG, we’re able to re-use wasted methane that is already in the environment (50-65% of which comes from human activity) and process it to create a baseload fuel source that displaces the need to voluntarily extract fossil fuel that is already sequestered in the earth. RNG is truly a ‘win/win,’ and I’m proud to advocate for it alongside my fellow members of the RNG Coalition.”
“RNG production facilities epitomise sustainability – and Mike is a leading voice in the sustainability movement to make RNG mainstream, to be considered alongside wind and solar as standard renewable energy resources,” said Johannes Escudero, CEO of the RNG Coalition. “Ameresco, the operator of the largest wastewater treatment biogas-to-RNG plant in the United States (Phoenix, AZ), is helping municipalities, industry and utilities increase RNG adoption. Mike has been a stalwart supporter of the RNG Coalition, including as a member of our Leadership Advisory Board, and we look forward to working with him in his new capacity as Chair of our Sustainability Advisory Board.”
In the wake of his appointment Mr Bakas spoke with the World Biogas Association. Given the emphasis on ‘sustainability’, we first asked, if that would preclude the use of purposefully grown biomass, i.e., energy crops?
Mr Bakas said, “Any fuel source that can create a net carbon reduction over its lifecycle should be considered for its application. However, it is imperative that such sources are analysed over their entire life cycle, taking into consideration all of their “ripple effect” impacts (e.g. water consumption, land use, etc.).”
Do you have a measure of the potential for RNG?
The RNG market has grown consistently in recent years due to programs such as the federal Renewable Fuel Standard (RFS) and state-level policies. RNG as a whole is on the verge of experiencing exponential growth thanks to new state-level incentive programs, a dedicated effort by natural gas utilities to decarbonise their pipelines and stakeholders’ desire to address thermal sustainability.
What do you see as the major challenges facing the ambition to position RNG alongside wind and solar as an energy source?
Costs have always been an issue with any technology that is in its “early stages” of being recognised as a promising solution. With continued RNG market growth, interest and long-term visibility (supported by the government much in the way it helped make the market for other renewables) we will see material investments into improving technology making them more efficient while driving production costs down.
By way of example, local and federal governments have acted as “market makers” by promulgating programs to give long term visibility to the solar PV and battery energy storage sectors. With such support giving confidence to the investment community that these technologies were here to stay and had great growth potential, investments poured into the manufacturing process, thus driving costs down. In fact, the U.S. Energy Information Administration reports that costs on a per watt basis for solar have fallen about 10% to 15% per year from 2010. Similarly, battery energy storage is enjoying the same experience, with some publications reporting that cost of electricity from batteries has decreased by 76% since 2012, making renewable energy combined with battery storage increasingly competitive with gas generation.
The other challenge RNG faces is the myriad of misinformation that exists. The reality is that, in most cases, biomethane is a product of human activity that will remain prevalent in society. By capturing this wasted resource that is already present in our environment and using it in lieu of non-renewable fuel sources to provide necessary services to society, we are having a tremendous positive impact on our environment. So, while there is still confusion that exists around RNG, many are catching on to the benefits as the market evolves.
What mechanisms could stimulate the market for and development of RNG?
As far as the transportation sector goes, long term visibility into incentives and government mandates could help stimulate the market for the development of RNG.
As far as the non-transportation sector, RNG is the only method for directly reducing Scope 1 emissions from Natural Gas Usage. As previously discussed, it is imperative that local, state and federal government continue to “foster the market” as it did for solar, wind and battery energy storage through incentive programs, mandates, grants and tax credits. For instance, the State of California created an incentive program to contribute a portion of the costs for the interconnection of an RNG facility to the natural gas pipelines (which at times can be very costly, therefore driving up the final unit cost of the RNG). In addition to grants like this, many states are drafting similar programs as the Low Carbon Fuel Standard to drive the market for RNG through mandates. Over time, these programs will create long term visibility for this renewable resource which will foster investment into the manufacturing side and drive down costs while increasing efficiency.
Do you foresee biomethane being a general source of gas, or more focused on the transport sector?
While we foresee that the transportation sector will continue to grow, without a doubt the non-transportation sector is heating up across the U.S. and will likely have a far greater demand than any other market for this product. Many Natural Gas Utilities are becoming very proactive and working with their local Public Utilities Commission (PUC) to promote new programs and tariffs for RNG. This increased demand (inclusive with the transportation sector) coupled with the support and mandates from the government will fuel (no pun intended) the growth for RNG. More so, with corporations continuing to focus on reducing and eliminating their carbon footprint, the market demand for RNG (the only resource available to mitigate fossil fuel combustion on site at these companies) will only continue to grow.