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Can Hydrogen and Renewable Natural Gas Displace Shale?

Can Hydrogen and Renewable Natural Gas Displace Shale? thumbnail

Today, corporate and state decarbonization announcements are progressing into actual strategic plans, often calling for increased production of hydrogen and renewable natural gas (RNG—cleaned methane from a landfill or anaerobic digester). These gases can use existing infrastructure while producing low-to-negative carbon emissions, making them an attractive lever for decarbonization. As a result, government incentives are pushing low-carbon gases into the market and other fuels out. Current policies direct those “clean” gases to the transportation market, where they displace gasoline and diesel. But on the horizon are state and corporate targets for blending RNG into pipelines, indicating that shale could be the next fuel to be displaced.

The falling production cost of “green hydrogen” drives much of today’s interest. In this instance, “green” means hydrogen produced by electrolyzing water into hydrogen and oxygen, powered by a zero-carbon electricity generation source. Previously, electrolyzers were expensive, and renewable electricity was expensive, making green hydrogen expensive. Improving technology and mass production are changing this paradigm. After significant declines over the last decade, IHS Markit anticipates the levelized solar and wind level cost could fall a further 50% and 25% by 2050 in our planning scenario. Combined with improved electrolyzer technology, green hydrogen looks set to be competitive with fossil fuel-derived hydrogen by the 2040s. In the meantime, subsidies and tax credits up and down the value chain incentivize production not only of hydrogen, but also cars, trucks, furnaces, and fuel cells that will enable society to use hydrogen in the energy transition.

Policy support also buoys renewable natural gas production. By capturing methane that would otherwise contribute to global warming, (at least 20 times more so than carbon dioxide), facilities like landfill recovery and agricultural digesters can produce natural gas with low or even negative carbon intensity. Incentives from the Federal Renewable Fuel Standard and state Low-carbon Fuel Standards make RNG production one of the U.S.’s hottest energy markets. New production facilities are sprouting across California’s Central Valley to capture what had formerly been a waste management burden. While production is booming, the bonanza doesn’t impact shale today as those subsidies direct RNG into automotive fuel markets, where they displace diesel and gasoline.

Depending on how you view the matter, mandates to blend increasing quantities of low-carbon fuels could displace shale in two ways. First is the physical displacement of shale gas by other molecules. With companies like SoCalGas and Dominion targeting upwards of 20% and 12% of total gas deliveries as RNG, the quantities are significant. Oregon is the leading state in RNG ambitions with voluntary RNG targets of 5% now and upwards of 30% by 2040. Second is economic displacement. Ratebasing development of RNG supplies will increase final consumer prices, making electrification and alternative technologies more attractive. In turn, that could displace additional shale gas.

But another view is that hydrogen and low-carbon gas enables shale. SoCalGas estimates that, because of the negative emissions effect of methane recovery, a 20% RNG blend could offset the CO2 emissions of the remaining 80% of fossil-derived gas. Green hydrogen contributes too. Oregon’s targets explicitly define hydrogen from renewable sources as a “renewable natural gas.” In states with net-zero emissions targets, utilities can continue to invest in and maintain infrastructure. Development of RNG resources also offers new revenue streams to dairy farms, landfills, sewage plants, and other sources of biomethane. While the concept is rife with controversy, the challenge of deep decarbonization makes hydrogen and low-carbon gases low hanging fruit.

About the author: Alex Klaessig is a research director on the IHSMarkit hydrogen and renewable gases team. Mr. Klaessig specializes in understanding how environmental regulation, technology, and innovation drive change in North American transportation and electricity markets. In addition to co-chairing the IHS Markit Energy Innovation Pioneers program,

Mr. Klaessig has been instrumental in several IHS Markit studies, including “Hydrogen in the Golden State.” He has authored numerous reports on research into air quality regulations and retrofit/retirement decisions on coal-fired generation and trends in technologies like cogeneration.

ShaleMag



16 Comments on "Can Hydrogen and Renewable Natural Gas Displace Shale?"

  1. Theedrich on Mon, 5th Oct 2020 12:05 am 

    “Greeniness” is a perpetual motion machine. Its promotors never mention the immense amount of fossil-fuel-supported infrastructure, both physical and human-technical, which will/would be needed to implement the Green Machine they sell.  Fads often seem to garner a lot of cash from investors and politicians.  Witness the dilution of gasoline with corn alcohol all around the U.S.  It has nothing to do with reducing pollution, etc. (although that is the propaganda for it), and everything to do with enriching the corn farmers, on whose votes and campaign funds the farm-state politicians rely.

    As with much else in modern America, renewableness is a pile of fakery meant to seduce laypeople.  The simple fact is that the current civilization has been built on fossil fuels, especially oil, and is unquestionably going to collapse without it.  Yes, windmills and solar panels and electric vehicles may satisfy the woke crowd and the politicians they empower, but in the end, it is physics which will have the last word.

    But kicking the can down the road and building Ponzi schemes are Stage One in Kübler-Ross’s “Stages of Grief” — which precede death.

  2. last i heard hydrogen is a carrier not energy sore Hydrogen and Renewable Natural Gas on Mon, 5th Oct 2020 12:55 am 

    why muzz got elevated

    Zareena Grewal has, in short, been successful and prosperous. Her work has received accolades. She got a plum job at an Ivy League university. But to hear her tell it, she lives a terrifying life cowering in fear of the racist, redneck yahoos who are bent on denying her and others like her their just rewards for their labors

  3. this is why the muzzie amputation machine behind the gate labeled victim is the busiest France: Macron announces plans to fight ‘Islamist separatism,’ Muslim leaders claim victim status on Mon, 5th Oct 2020 12:57 am 

    reserrch shows

  4. nonsense talk only master race china can harvest Speaking outside Paris on Friday, Mr Macron said radical Islam was a danger to France because it held its own laws above all others and “often results in the creation of a counter-society”. on Mon, 5th Oct 2020 1:00 am 

    this is just fleeting
    a momentary wet fart

  5. looks like charlie hebdo number three […]On Thursday, Azhar’s Grand Imam Ahmed al-Tayeb voiced “immense anger” at the use by some Western officials of the term “Islamist terrorism”, without heeding its ramifications. on Mon, 5th Oct 2020 1:04 am 

    wonder what ramifications means

  6. zero juan on Mon, 5th Oct 2020 4:27 am 

    nightly Stupid from JuanP:

    drmustafaacar.com said Günümüzde insanların birçok sağlık problemi ile uğ…

    looks like charlie hebdo number three […]On Thursday, Azhar’s Grand Imam Ahmed al-Tayeb voiced “immense anger” at the use by some Western officials of the term “Islamist terrorism”, without heeding its ramifications. said wonder what ramifications means

    nonsense talk only master race china can harvest Speaking outside Paris on Friday, Mr Macron said radical Islam was a danger to France because it held its own laws above all others and “often results in the creation of a counter-society”. said this is just fleeting a momentary wet fart

    this is why the muzzie amputation machine behind the gate labeled victim is the busiest France: Macron announces plans to fight ‘Islamist separatism,’ Muslim leaders claim victim status said reserrch shows

    last i heard hydrogen is a carrier not energy sore Hydrogen and Renewable Natural Gas said why muzz got elevated Zareena Grewal has, in short…

    ppl who use backslash are ahole and not trustworthy said probablly inflicted with severe muzz love syndrome…

    Moubarac interpreted the end of Christian political power [i.e. in Lebanon] as a religious liberation which would restore to the Church the vocation that Islam had assigned to it: a service of charity and love toward Muslims. said lovers running amuck wonder why wonder no mo

    we can say whitey supertard president trump is convicted-19 and now hes not convicted-19 said he went to wave to supporter and they dont like it…

  7. Abraham van Helsing on Mon, 5th Oct 2020 5:10 pm 

    BoJo announces that every UK home to be powered by offshore wind by 2030:

    https://www.dailymail.co.uk/news/article-8808135/Boris-Johnson-promises-wind-farms-power-home-Britain-ten-years.html

    “Wind farms to power EVERY home in Britain in ten years: Boris Johnson will use party conference speech to unveil dramatic new pledge as part of ‘green industrial revolution’“

  8. Abraham van Helsing on Mon, 5th Oct 2020 5:38 pm 

    This just in: Trump will NOT cancel any debate.

  9. Duncan Idaho on Mon, 5th Oct 2020 5:53 pm 

    Fat Boy on ‘roids. Oh my God.

    https://digbysblog.net/2020/10/trump-on-roids-oh-my-god/

    But, should be entertaining, just don’t get close.

  10. dissident on Tue, 6th Oct 2020 2:02 pm 

    Wake me up when hydrogen filling stations are around every corner.

  11. Duncan Idaho on Tue, 6th Oct 2020 2:55 pm 

    Trade deficit hits $67.1 billion, widest in 14 years
    ( Junior was Pres— only one as dumb as the Fat Boy, but the Fat Boy is probably a better thief)

    https://www.foxbusiness.com/economy/trade-deficit-hits-67-1-billion-widest-in-14-years

  12. we can harvest muzz to run muzz hamster machine to make hydrolysis dissident on Tue, 6th Oct 2020 2:02 pm Wake me up when hydrogen filling stations are around every corner. on Tue, 6th Oct 2020 3:38 pm 

    Real Green

  13. Abraham van Helsing on Tue, 6th Oct 2020 3:48 pm 

    “Trade deficit hits $67.1 billion, widest in 14 years”

    Gonna be a hard smack on the face when reality kicks in. You are certainly going to miss the dollar reserve currency, so much is certain. Gotta work for a living for a change. Poor dunkan. Doubt if this one-trick pony is designed for anything else than agitating against white people 24/7.

  14. we can harvest on Tue, 6th Oct 2020 3:51 pm 

    im thinking

  15. Duncan Idaho on Tue, 6th Oct 2020 3:57 pm 

    Texas megachurch pastor tests positive for COVID-19 after suing to reopen schools

    ( this ignorant dud is a fat one– )

    https://www.alternet.org/2020/10/texas-megachurch-pastor-tests-positive-for-covid-19-after-legal-push-to-reopen-schools/

  16. supertard r u gona roid rage and drive my stocks down on Tue, 6th Oct 2020 4:48 pm 

    please love supremacist muzz more

    Abraham van Helsing on Tue, 6th Oct 2020 3:48 pm

    “Trade deficit hits $67.1 billion, widest in 14 years”

    Gonna be a hard smack on the face when reality kicks in. You are certainly going to miss the dollar reserve currency, so much is certain. Gotta work for a living for a change. Poor dunkan. Doubt if this one-trick pony is designed for anything else than agitating against white people 24/7.

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