RNG as a solution to an invisible challenge
At a glance
We sat down with GHD’s newly appointed RNG Lead, Amir Ghasdi, to get his view on the importance of RNG to the energy transition, the barriers to RNG’s wide adoption and the costs of integrating it as part of our natural gas networks on the path to net-zero.
For governments and businesses to meet their net-zero 2050 targets identified in the Paris Agreement, we must collectively reduce the carbon intensity and emissions across all sectors. Renewable Natural Gas (RNG), a clean, affordable and reliable waste-derived fuel plays a role in this transition by using methane that would otherwise be released into the atmosphere to power residences, commercial establishments and transportation vehicles alike. Alternatively, it can serve as a feedstock for producing other low-carbon fuel alternatives, such as hydrogen (H2) and in general by replacing conventional natural gas as a lower-carbon fuel alternative.
How is RNG used today and where is it going?
We are seeing tremendous growth with projects that are taking off – it is booming right now. Currently, government regulations and incentives are being placed to promote the production of RNG from waste and contribute to decarbonizing the transportation sector through vehicle fueling. However, we are increasingly seeing a shift towards decarbonizing natural gas utilities through blending RNG and/or renewable H2 into natural gas pipelines.
As we advance, we can predict regulations and incentives that include RNG to continue in favor of reducing emissions from the energy sectors. Gas utilities and fuel producers understand the need to reduce carbon emissions and decarbonize distributed utilities. They are setting targets and mandates to blend a percentage of natural gas with RNG. Consumers are also becoming more in favor of lowering their own carbon usage. Therefore, RNG is in everyone’s interest and will continue to grow.
What are the biggest opportunities for RNG?
Negative carbon intensity scores with biogas from agri-waste
The agricultural sector generates a significant amount of organic waste such as crop residues, food waste and animal manure. RNG production enables livestock operators to monetize this waste by converting it into an energy source and providing an additional revenue stream. One of the challenges to net-zero is the need to generate renewable fuels and energy with low carbon intensity scores; the measure of total carbon emissions divided by total units of production or total economic activity. Biogas from agri-waste has a negative carbon intensity score, making it an important tool to enable efficient, low carbon energy production relative to the produced emissions.
Waste management and the circular economy
RNG production involves using organic waste sources that would otherwise be sent to landfill, releasing greenhouse gases into the atmosphere. When we use these waste streams as feedstock for RNG, we are not only reducing waste, but we are also turning it into a valuable resource, contributing to a circular economy. But that’s not where it stops – we can further extract value from the nutrients in the waste that are left over. Nutrient management can be done by using anaerobic digestion. Using this process, we can convert them into fertilizer and integrate it back into the agriculture cycle.
What are the some of the challenges with RNG?
One of the main issues with RNG is its cost of production. Currently, it is about five to ten times the price of conventional natural gas, and this cost to price gap is one of the barriers to wide RNG adoption. However, businesses and communities must not only look at projects in terms of dollars and cents. There is a cost associated with it indeed, but there are also costs associated with inaction. We need to start looking at RNG differently from a place of urgency – however it is hard to detect this urgent need for action behind gas emissions that we cannot see.
Navigating the invisible challenge
When it's not visibly obvious, it is easier for the public to turn a blind eye. For example, when we think about managing waste or wastewater, we understand that waste is tangible, and we must find solutions to manage it, or we will have a big problem. There are costs associated with this waste management and people understand the financial implications when they see a bill or tax statement for these programs. Methane emission or any other emissions resulting from human activities is similar in that if we don’t act on reducing emissions, we will have a big problem. But people are skeptical about the necessity or rational behind undertaking environmental-related projects, primarily due to their associated costs. As a society, we all must share the responsibility for covering the costs of reducing emissions, such as capturing methane from our own waste-generating activities. Thinking of it as a way of managing “waste emissions” could help people understand the situation and why there are associated costs.
According to our SHOCKED global research report, 67% of energy sector leaders in North America identify community opposition as one of the largest obstacles to getting new projects approved. Successful energy diversification and transition will require significant infrastructure development, so it will be critical to secure the support of local communities. This will require authentic, honest conversations around the realities of building more resilient systems that can weather shocks, including discussion of the scale of the transition and the costs involved.
“It’s up to all of us as experts in the industry to help educate society on the benefit of RNG to help them understand that we need to act now and have an obligation to bring projects to life that are sustainable and build our planet for the next generation,” says Amir.
Where RNG pays off
While it is true that certain incentives exist in the market to drive RNG projects and provide a revenue stream for producers, our focus should not solely be on generating revenue when considering these projects, and we should avoid disregarding projects solely because they fail to meet the investors' return on investment expectations. Undoubtedly, there are costs associated with capturing methane and converting it into RNG. When discussing the implementation of a project involving infrastructure investments like anaerobic digesters, people often focus on the project's economic aspects. However, it is crucial to also consider the potential negative impact on the environment if such initiatives are not pursued. Failure to implement environmentally beneficial projects can lead to adverse consequences, such as increased greenhouse gas emissions, pollution, and further degradation of our ecosystem. Therefore, it is essential to strike a balance between economic considerations and environmental concerns to ensure sustainable development and a healthier planet. We shouldn’t look only at the profitability of the project – this is our obligation.
While the technologies aren’t mature enough to reduce the cost of production yet, the expectation is that costs will reduce over time as it is mass produced and the advantages of the economy of scale are unlocked. Until that point, it becomes the government's obligation to establish regulations that support environmentally friendly projects, and society also bear the responsibility to contribute by reducing waste and emissions while being willing to incur the necessary costs associated with these efforts. By collectively working towards these goals, we can make a positive impact on the environment and foster a sustainable future for generations to come.
What are your aspirations for your new role as RNG lead?
I began as a process engineer where I was introduced to RNG as a technology. Once I saw how I could use my expertise and education to contribute to the energy transition, it became a passion. I was able to help optimize processes to improve the efficiency of RNG production and implement the waste to renewable energy projects. I have confidence in the significance of renewable energy in the future energy landscape. After seeing the early projects in Europe and how beneficial they were to society, I was amazed. It has changed the way I look at projects and made me decide to stay in this field, learn and contribute.
While I was involved in developing solutions, I had a chance to work with many engineering consultants, including GHD. In my opinion, the level of expertise, talent and knowledge from this team is the best in the market. I haven’t personally seen this level of expertise anywhere else. They are looking forward and seeing the future. They aren’t just looking at current projects, they’re looking at how to change the way we do things to improve the quality of life for society, especially when it comes to decarbonizing the energy sector. I believe in my new team, our message and our mission and I am excited to be a part of this journey.
Meet the author
Amir Ghasdi joins us as our RNG National Leader after spending the 20 years of his career in a variety of roles including process engineer, technical lead and market leader in renewable energy. As our RNG lead, he will focus on the RNG market across North America; helping clients navigate their portfolio of RNG projects from concept to offtake.