Author: Joseph Murphy, Natural Gas World  |  24 March, 2023

In a nutshell, how can renewable natural gas help deliver on the emissions goals of British Columbia and Canada at large?

Renewable natural gas, or RNG, is a viable avenue to help not just B.C., but all of Canada, reach our shared climate action goals. RNG puts waste to work.

When organic waste decomposes, be it in landfills, farms or wastewater treatment facilities, it releases a biogas mostly made of methane that escapes to the atmosphere. FortisBC works with local governments, municipalities and green energy companies to capture and purify this methane and repurpose it as RNG. Since RNG is derived from organic sources and uses carbon already within the ecosystem, it’s a very low carbon gas over its lifecycle. RNG replaces conventional natural gas in the system, so RNG can help decarbonise the natural gas supply and reduce emissions from a system that millions of Canadians rely on every day. RNG can help people use less fossil fuels. For this reason, FortisBC is working towards having 75% of the natural gas in its system be renewable and low carbon by 2050. Based on our growth, we’re confident we’ll get there.

RNG can be an affordable and sustainable choice for British Columbians to reduce emissions in their homes and businesses without undertaking potentially expensive retrofits. Increasing the amount of RNG in our system is an important aspect of FortisBC’s Clean Growth Pathway emissions reductions strategy and the B.C. provincial government’s CleanBC Roadmap. The CleanBC Roadmap reaffirms that our gas system will continue to play an important role in decarbonisation and accelerate the transition towards renewable and low carbon energy, including RNG and hydrogen.

 

Take us through FortisBC’s contributions to government emissions reduction targets in the RNG field? What is the story so far and what can we look forward to in the future from the company?

We were the first utility in North America to offer RNG to customers, starting over 10 years ago. Our RNG team was a pioneer in the renewable and low carbon gas sector in North America, and continues to be a trailblazer in working with new suppliers every year.

Since 2020, we’ve signed over 25 new supply agreements that were approved by our regulator, the British Columbia Utilities Commission. As of February 2023, we’re receiving RNG from 12 RNG suppliers (six from within BC). The British Columbia Utilities Commission has approved an additional 20 projects, and we continue to pursue new supply agreements while the existing projects work their way through the regulatory and construction processes.

We’re continuing to drastically increase our supply of RNG. By the end of 2022, at maximum contracted volume, our current 12 suppliers could deliver almost 12 million gigajoules of RNG annually. That’s just over 5% of the total natural gas in our system, and enough energy to meet the natural gas needs of over 130,000 homes in BC based on average annual usage. We project that by 2025, we can have almost 18mn GJ of RNG flowing through our system – roughly 8% of our natural gas supply.

We’re not stopping at RNG. As we continue to increase RNG supply, we’re also working to advance hydrogen. As a first step, we invested around $500,000 with the University of British Columbia Okanagan campus to establish a dedicated lab to test how to safely deliver hydrogen into our natural gas system. Last year, we teamed up with Hazer Group Limited and Suncor Energy on a pilot project to produce clean burning turquoise hydrogen. This first-of-its-kind technology in North America will extract hydrogen from natural gas, and capture the remaining carbon as solid graphite instead of letting it escape into the atmosphere.

 

How can the regulatory environment help provide the commercial stimulus for the development of RNG in British Columbia?

This is a continuously evolving environment. We’ve submitted an application to the British Columbia Utilities Commission that marks a new chapter in our company's evolution as a low carbon energy company. If approved, every newly built residential natural gas connection (province wide) will automatically receive 100% RNG, resulting in significant emission reductions as compared to conventional natural gas. The application also would allow all current residential and commercial customers to automatically receive 1% RNG in the near future – a percentage that would build over time as we increase our supply.

This is a first-of-its kind application in North America that was designed to meet municipal greenhouse gas emissions targets and other emission reducing policies (at time of submission) in support of the CleanBC Roadmap. If approved, it could provide home builders, real estate developers and new homeowners an alternative energy choice to help meet provincial greenhouse gas reduction targets, cost-effectively.

 

In which sectors are you seeing the biggest appetite for the purchase of RNG?

With the rise of organisations setting defined environment, social and governance (ESG) goals, we’re seeing growing interest in RNG across several sectors. Public sector organisations, in particular, are showing interest as they are historically gas customers and RNG allows them to reduce their carbon footprint without undertaking costly retrofits. The education and health care sectors are also showing a growing appetite in reducing emissions through the use of RNG. 

As more and more businesses set greenhouse gas emissions reduction targets, we believe we’ll continue to see organisations explore RNG as a viable option to decarbonise.

 

In what ways is FortisBC providing benefits to local communities from its projects?

FortisBC works with local governments, farms, landfills and green energy companies to capture escaping methane from organic waste and repurpose it as RNG. These local suppliers receive an alternative, long-term revenue stream, partner stability and receive RNG expertise from the FortisBC team that introduced the commercial RNG program in North America. Municipalities have multiple opportunities to generate RNG – whether it’s through landfills, agricultural operations or wastewater treatment plants.

FortisBC is committed to investing in the communities in which our staff live and work. Every year, we partner with community leaders and collaborate on developing innovative energy solutions uniquely suited to each community. We also invest in four key areas that, together, help contribute to the well-being of BC communities: safety, education, Indigenous initiatives and environment.

 

What is the rationale behind the Tilbury LNG expansion and jetty project? Can FortisBC provide an update on the regulatory process?

The Tilbury Expansion would increase the production and storage of LNG to improve resilience and security of supply to FortisBC’s more than 1mn gas customers in B.C., and supply incremental LNG for marine transportation and for global markets.

By 2037, we expect daily demand in the Lower Mainland to grow by 10 TJ/day. A new storage tank is needed to help ensure reliability of service for our customers as demand increases. The proposed tank is sized to maintain service in the event of a gas supply disruption for at least three days at the coldest time of the year.

A marine jetty would allow our region of the west coast to take part in the global shift to LNG marine fuelling that is already underway. Tilbury LNG can reduce greenhouse gas emissions by up to 27% compared to conventional marine fuel, such as diesel. A third-party study has shown that switching all ships that call on the Port of Vancouver to LNG marine fuel from common marine fuels like diesel could also remove 90% of all particulate matter associated with marine shipping from the local airshed.

The Tilbury Marine Jetty project is currently awaiting approval from the B.C. Environmental Assessment Office and the Impacts Assessment Agency of Canada.

The Tilbury Phase 2 LNG Expansion project, which consists of a new storage tank and liquefaction unit, is in the application phase of the environmental assessment process. The draft application could be submitted as early as Q2 2023.

 

Footnote:

FortisBC uses the term renewable and low-carbon gas to refer collectively to the low-carbon and carbon-neutral gases or fuels that the utility can acquire under the Greenhouse Gas Reduction (Clean Energy) Regulation, which are: renewable natural gas (RNG or biomethane), hydrogen, synthesis gas (from wood waste) and lignin. Depending on their source, all of these gases have differing levels of lifecycle carbon intensity. All gases would meet the proposed B.C. carbon intensity threshold for low-carbon gases of 36.4 g CO2e/MJ set out in the 2021 B.C. Hydrogen Strategy.

Author: Joseph Murphy, Natural Gas World  |  24 March, 2023

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