The role of renewable gases in reaching net zero

Large biogas facility (net zero)
Large biogas facility (Image: Shutterstock)

The penetration of wind and solar power generation in the electricity grid must become very high in order to move to a net zero emissions energy sector in Australia, according to Oakley Greenwood.

This creates its own unique problems as these forms of generation are intermittent. We see periods where wind and solar:

• Produce for lengthy periods at low outputs, and

 • Do not complement each other in terms of when they are producing.

This gives rise to grid stability issues which are becoming better understood and managed by system operators—but the issue for investors and customers is how much renewable energy storage investment does the system need and what is the nature of that storage. 

This issue will become an overriding consideration in the transition to a net zero energy sector—as that does not only involve electricity but gas and liquid fuels being also reduced to net zero emissions. Largely this will require a major increase in renewable electricity generation as a basis for development of alternative zero-emission fuels such as renewable gases (and liquids).

What is essential to this transition is the ability to store very large quantities of renewable electricity, and our analysis points to renewable gases being a prime opportunity to assist with this requirement.

Related article: Jemena calls for renewable gas target

1.1. Learning from South Australia

We have the advantage of being able to study the South Australian (SA) electricity sector to examine this issue, within the Australian electricity market context, over a two-year period. This real-world example demonstrates:

• The very high reliance on highly flexible natural gas supply, and 

• The criticality of the existing gas infrastructure and storage assets for that flexible supply, to

• Achieve high levels of renewable electricity production in that state, and

• The commensurate much lower sector emission because of this mix (no coal generation in the state)—already a third of those of its neighbouring state of Victoria.   

If for example this initial transition model was rolled out across Australia (gas as an initial transition fuel) this would produce a very fast decline in emissions—using existing technologies.

If the gas was then decarbonised the cycle to net zero would be complete. Zero-emission methane production at economic costs is the key as it is of pipeline quality and can use all the existing gas infrastructure. 

• Gas storage on the east coast alone is some 150PJ or 40,000GWh equivalence. 

– This would produce 20,000GWh through a gas generator (at 50 per cent efficiency) representing a huge renewable electricity storage “battery”. 

  – This can be complemented by big batteries (e.g., 0.3GWh) and pumped hydro (Snowy 2.0 is 350GWh) but the scale of the existing gas “battery” infrastructure is a key asset gas can bring to a net zero transition.

Zero-emission methane can be sourced from:

 • A potentially very large bioenergy/biomethane resource capability at very competitive pricing (see the recently released Australia’s Bioenergy Roadmap, Enea and Deloitte for ARENA, November 2021), and

• From the methanation of the carbon dioxide that would also come from the production of biomethane (which has not been accounted for to date but could double the bioenergy contribution).

– The bioenergy resources could displace all the gas on the east coast if the analysis is correct and achievable.

• From the methanation of hydrogen using carbon dioxide extracted from the air using direct air capture technology—either using existing technology or single reactor technology developments.

• We have recently released a paper n the economics of these zero-emission methane gases.

Source: OGW analysis of AEMO dispatch and demand data (MW)

1.2. The issues with renewable electricity generation intermittency

SA has the highest level of wind generation capacity within its energy mix of any Australian State or Territory (2,140MW in 2019-20). The scheduled solar PV generation in SA is comparatively low (378MW), but rooftop solar PV penetration is relatively high (1,417MW). All are forecast to continue to increase substantially, and this will be essential in meeting net zero.

Wind generation contributed some 40 per cent of the energy generated in 2019-20, gas generation 43 per cent (and solar, including rooftop PV was 15 per cent). SA has no coal fired generation but is linked to Victoria with a transmission line. There are days where renewables can literally supply the whole state demand and others where it is very dependent on gas generation due to intermittency issues.

The SA electricity market data over a two-year period also demonstrates that there are prolonged periods where there is low output of renewable electricity generation. This is due to well-known weather effects such as prolonged cloud cover impacting solar generation and high-pressure systems suppressing wind generation. The SA experience can therefore point to what the implications are to the supply of electricity when considering a transition to net zero emissions.

Related article: Energy vision for a net zero future

In the two-year period examined there were 292 days out of 730 days (40 per cent) where wind generation was less than 20 per cent of the SA energy mix, and

• Included 20 days out of a 30-day period where wind generation was less than 20 per cent of the installed wind generation capacity.

• During this “wind drought” wind generation provided some 25 per cent of demand, solar generation 4 per cent, and 71 per cent was supplied by a combination of SA gas and diesel generation and imports.

In this case, the amount of renewable energy storage that would be required to ensure continuous supply (eliminating existing gas, diesel and imports) is hugely significant, at circa 870GWh—some two-and-a-half times Snowy 2.0 or some 2,900 big batteries. In gas terms this is some 14 to 15PJ depending on power station efficiencies, and has been achievable. 

Oakley Greenwood has been analysing future renewable generation penetration impacts in SA using AEMO ISP data and this continues to show the need for major renewable energy storage when these prolonged intermittency events occur (deep storage).

Gas can play a major role in decarbonisation pathways, particularly using zero-emission gas technologies, and may be the only way to achieve the very high levels of renewable energy storage indicated economically.  

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