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Gas set for supporting role in first EU ‘Fit for 55’ proposals

The European Commission plans more support for low-carbon fuels, including low-carbon gas, and hydrogen as part of its reforms of the Renewable Energy Directive, but will tackle the decarbonization of gas and gas market reform in separate legislative proposals later in 2021.

Industry groups have called for the EC to include binding targets on the level of emissions from gas use in the EU and on the use of biomethane as part of the EC’s “Fit for 55” legislative proposals, expected in July.

The package is designed to provide the roadmap for the EU to meet a revised target of reducing greenhouse gas emissions by 55% by 2030 from 1990 levels.

Gas — while not a central focus of the new package — will not be forgotten as Brussels drafts the legislative proposals with one eye on the cleanest of the fossil fuels.

Antonio Lopez-Nicolas, the EC’s deputy head of unit for renewables and energy system integration policy, said in May that it was considering its proposals for a new gas decarbonization package — expected in late autumn — in tandem with its review of the RED.

“We see a strong contribution of the gas sector to the climate and energy targets with a clear shift of the gaseous energy mix and a clear need to have renewable and low-carbon gases playing this role in the decarbonization,” Lopez-Nicolas said.

“We are looking at the gas market decarbonization package in a very coordinated way with the review of the RED,” he said.

Once seen as a bridging fuel to a lower-carbon future, gas has increasingly fallen out of favor with the EC in the past few years.

Its executive vice-president Frans Timmermans said in March that there was only a “marginal” role for unabated fossil gas during the energy transition and that fossil gas had no “viable future.”

Gas did, however, receive a small boost on June 11 when EU energy ministers agreed a transitional period to the end of 2029 to allow EU funding for gas projects under the TEN-E regulation provided that a pathway to hydrogen conversion was shown.

‘Green’ gas

The European gas industry is now increasingly focusing its lobbying efforts on a bigger and faster uptake of “green” gases, such as biogas, biomethane, bio-LNG and other renewable gas forms, as well as carbon capture and storage, and the conversion of gas into hydrogen.

As part of the revision of the RED, the EC is set to propose a “fully-fledged” scheme for hydrogen certification, including renewable and low-carbon hydrogen, but also other low-carbon and renewable fuels such as biogas, Timmermans said.

“Robust, clear and reliable certification is an important first step to allow for renewable and low-carbon gases to be traded across Europe,” he said.

The EC’s planned review of EU gas market legislation to be adopted by the end of 2021 is expected to include measures to support the uptake of renewable and low-carbon gas, and the development of an EU hydrogen market.

Industry believes targeted action to decarbonize the gas sector is needed, with calls for a balanced approach using renewable and low-carbon gases together with energy efficiency to reach net-zero in a cost-effective way.

In late May, 12 European industry bodies said in a joint letter to EU policymakers that the EU needed binding 2030 targets both to reduce the greenhouse gas intensity of gas consumed in the bloc and to increase demand for renewable gas.

In the letter, the groups said that gas — natural, renewable and decarbonized — would play a “decisive role in the decarbonization efforts of every sector, including buildings, industry, power, and mobility, as well as agriculture.”

“The 2030 targets we are advocating for would send clear signals to investors in terms of decarbonizing gas and scaling up renewable gases,” Eurogas Secretary General James Watson said.

“These signals are urgently needed — we cannot afford to wait to act,” Watson said.

The first proposal supported by the 12 groups is that by 2030 the greenhouse gas intensity of the gaseous energy consumed in the EU should be reduced by at least 20% compared with 2018 levels through the use of renewable and decarbonized gases.

The second target is for renewable gases to account for at least 11% in terms of energy content of gas consumed.

“It should be possible to comply with the greenhouse gas intensity reduction target and renewable gas target building on existing RED mechanisms,” they said.

Methane emissions

A final element in the EU’s upcoming legislative proposals is how to tackle methane emissions from the upstream sector.

Expected alongside the gas directive proposals in late 2021, the EC has hinted that it would first target low-hanging fruit, including legislating on methane leak detection, measurement, reporting and repair.

It also plans to target the elimination of gas flaring.

Methane is a much more powerful climate pollutant than carbon dioxide, with estimates suggesting it is 84 times more potent than CO2 over a 20-year time frame.
Source: Platts

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