- The biomethane sector in Europe is growing. In 2020, 32 TWh of biomethane was produced. The number of biomethane plants increased by 13 % in 2021 to 992 plants (as of 08/21)
- Biomethane, bio-LNG and bio-CNG demand continues to grow in industry and the transport sector to replace fossil alternatives as climate-neutral energy carrier and/or feedstock
- Biomethane use in industries is increasing by replacing natural gas, while industry is also seeking to tap into the 310 Mt/year biogenic CO2 potential to achieve negative emissions
- Increasing number of reverse flow facilities are being installed to facilitate the injection and transportation of biomethane in the gas distribution grids
- 50 GWs of green hydrogen projects have been announced to be in operation by 2030, 25% more than the EU’s 40 GW target
- To keep up, electrolyser ‘gigafactories’ totalling over 20 GW/y of capacity by 2025 have been announced, with 88% – almost 18 GW/y – of capacity being in Europe
- Hydrogen demand uptake is expected in steelmaking and for e-fuels, due to EU (proposed) mandates in the FF55 package
- Dedicated hydrogen transport and storage infrastructure to be deployed as IPCEIs in coming years
A new report, the Market state and trends in renewable and low-carbon gases in Europe, published by the Gas for Climate consortium is launched today. The report provides a concise addition to the comprehensive 2020 Market Sate and Trends report, identifying the most recent key trends across the value chain of biomethane and green and blue hydrogen. The report, developed by Guidehouse, focuses on indicators and project examples by collecting and combining statistical information and showcasing the latest projects.
The biomethane sector is growing, with an annual production increase of 17%, reaching 32 TWh in 2020. Bio-LNG production is expected to increase eightfold to 9.5 TWh by 2023. Reverse flow facilities are being put in place to allow bidirectional flow between the gas distribution and transmission grid, enabling the increase of produced biomethane to be injected into the grid. Biomethane is replacing natural gas in hard-to-abate sectors. Industry is seeking to tap into the 310 Mt/year biogenic CO2 potential to achieve negative emissions. Biogenic CO2 (captured from biomethane production) is being used in the industry sector as a feedstock to replace fossil-based CO2.
The green hydrogen project pipeline is skyrocketing with more than 50 GW of green hydrogen capacity planned to be in operation by 2030. To keep up, electrolyser manufacturing plants, or “gigafactories”, have been announced totaling over 20 GW/year by 2025 – of which almost 90% are located in Europe. Dedicated hydrogen transport and storage infrastructure is to be deployed as Important Projects of Common European Interest (IPCEIs) in coming years. Large increase in hydrogen demand is expected in Europe. Emerging demand in e-fuels, due to an EU mandate, can possibly lead to around 90 TWh/year of hydrogen demand by 2030. In addition, many steelmakers have announced plans to switch to hydrogen-based steel making. Announced plans alone add up to 30% of current primary steel capacity in the EU by 2030, which would lead to around 80 TWh/year of hydrogen demand by 2030, signalling a key trend.
All these developments provide a start to achieve the EU 2030 decarbonisation target and show that industry is ready to scale up biomethane and hydrogen. However, a political commitment to the role of gas infrastructure and renewable and low-carbon gases in meeting EU climate goals is needed now. Otherwise, we risk missing the 2030 goals.
Download the Market State and Trends report here.
Notes for Editors
Gas for Climate was initiated in 2017 to analyse and create awareness about the role of renewable and low carbon gas in the future energy system in full compliance with the Paris Agreement target to limit global temperature increase to well below 2 degrees Celsius. To this end, the entire economy has to become (net) zero carbon by mid-century.
The Gas for Climate group consists of eleven leading European gas transport companies (DESFA, Enagás, Energinet, Fluxys Belgium, Gasunie, GRTgaz, Nordion, ONTRAS, OGE, Snam, and Teréga) and two renewable gas industry associations (European Biogas Association and Consorzio Italiano Biogas).
The CEOs of the twelve members are: Piero Gattoni (Consorzio Italiano Biogas, European Biogas Association), Maria Rita Galli (DESFA), Marcelino Oreja Arburúa (Enagás), Torben Brabo (Energinet), Pascal De Buck (Fluxys), Han Fennema (Gasunie), Thierry Trouvé (GRTgaz), Ralph Bahke (ONTRAS), Jörg Bergmann (OGE), Marco Alverà (Snam), Hans Kreisel (Nordion Energi), Dominique Mockly (Teréga).
In a series of reports over the past few years, the Gas for Climate consortium showed that renewable and low-carbon gases have an important role to play in the EU energy system and that existing gas infrastructure and knowledge can support the transition to an energy system with net-zero CO₂ emissions at the lowest societal cost. The Gas for Climate vision and pathways towards 2050 cover all energy-intensive economic sectors and demonstrate, along with the crucial role of renewable and low-carbon gases, that current policies and trends are not yet sufficient to realise Europe’s climate ambitions for 2030 and 2050 Policy and market actions are required to speed up the transition, and progress of necessary developments must be closely monitored to ensure the transition is achieved at the lowest societal costs.
Renewable and low-carbon hydrogen and biomethane developments attract a lot of positive attention in the media, both in discussions of new policies and in company strategies. To better track the current market state of deployment and trends towards further scale up and cost reductions, Gas for Climate published a comprehensive overview in December 2020. The 2020 market state and trends report provided an overview to policymakers, energy users and producers, equipment manufacturers, and infrastructure companies. This 2021 edition is an addition highlighting the most recent market developments of the past ten months for biomethane and hydrogen. While the transformation towards net-zero CO₂ emissions is multifaceted and consists of many interlinked market and technological developments, the main focus of the analysis is on key trends in sectors and subsectors most promising in the early 2020s-2030, as identified in the pathways study [1]
[1] Gas for Climate, Gas Decarbonisation Pathways 2020-2050 (2020), https://gasforclimate2050.eu/?smd_process_download=1&download_id=339
[2] Gas for Climate, Job creation by scaling u renewable gas in Europe (2019), https://gasforclimate2050.eu/?smd_process_download=1&download_id=275. This report concludes that scaling up biomethane and green hydrogen to 2900 TWh by 2050 can create 1.7 million to 2.4 million jobs by 2050, of which 600,000 to 850,000 direct jobs.
For more information, please contact the Gas for Climate member organisations:
| Consorzio Italiano Biogas Caterina Nigo Tel: +39 0371/4662633 Mail: a.vitale@consorziobiogas.it
Enagás DESFA Energinet European Biogas Association Fluxys Belgium Gasunie |
GRTgaz Jean Marc Brimont Tel: +33 6 89 87 16 23 Mail: jeanmarc.brimont@grtgaz.com
Nordion Energi ONTRAS OGE Snam Teréga |
About CIB – Consorzio Italiano Biogas
CIB aggregates and represents the agricultural biogas and biomethane value chain in Italy. Formed in March 2006, CIB provides information to its members to improve, optimize and innovate biogas production processes, fostering greener and efficient low carbon farming practices through its flagship initiative Biogasdoneright®. CIB brings together farmers that run biogas plants, industrial companies that supply equipment and technology, companies operating in the fields of agriculture, consultancy, mechanization and transports; research centers and agricultural associations that supply data and promote anaerobic digestion in agriculture. CIB is also a founding member of EBA -the European Biogas Association. For more information, go to www.consorziobiogas.it.
About Enagás
Enagás is a TSO (Transmission System Operator) with 50 years’ experience in the development, operation and maintenance of energy infrastructures, operating in eight countries: Spain, the United States, Mexico, Chile, Peru, Albania, Greece and Italy. The company has more than 12,000 kilometres of gas pipelines, three strategic storage facilities and eight regasification plants. In Spain, it is the main natural gas transporter and the Technical Manager of the Gas System. Enagás is firmly committed to the decarbonisation process and therefore is bounded to the development of projects to promote renewable gases – green hydrogen and biomethane – sustainable mobility and energy efficiency, among other areas. The company is a world leader in its sector in the Dow Jones Sustainability Index (DJSI), according to the latest revision of this index. For more information, go to www.enagas.es.
About Energinet
Energinet was founded in 2004 as an independent public enterprise owned by the Danish Ministry of Climate, Energy and Utilities. Energinet owns, operate and develop the transmission systems for both electricity and natural gas in Denmark. Energinet’s aim is to enable a cost-effective transition of the energy systen to 100 % renewable energy while maintaining the high level of security of supply. For more information, go to www.energinet.dk.
About European Biogas Association
Founded in February 2009, EBA is the leading European association in the field of biogas and biomethane production covering the anaerobic digestion and gasification industries. Committed to the active promotion of the deployment of sustainable biogas and biomethane production and use throughout Europe, EBA has created a wide network of established national organisations, scientific institutes and companies. In 2018, the association counted more than 90 members from all over Europe and has established co-operation with biogas associations from outside Europe. For more information, go to european-biogas.eu.
About Fluxys Belgium
Fluxys Belgium is the independent operator of both the natural gas transmission grid and gas storage infrastructure in Belgium. Through its wholly owned subsidiary Fluxys LNG, the company also operates the Zeebrugge liquefied natural gas (LNG) terminal. Fluxys Belgium is a subsidiary of Fluxys, the gas infrastructure group based in Belgium and active across Europe. We are committed to continue building a greener energy future for the generations to come. People, industry and societies all need energy to thrive and progress. Fluxys Belgium accommodates this need: we put energy in motion through our infrastructure. We move natural gas while paving the way to transport in our infrastructure hydrogen, biomethane or any other carbon-neutral energy carrier of the future. For more information, go to www.fluxys.com/belgium.
About Gasunie
Gasunie is a European energy infrastructure company. The company provides the transport of natural gas and green gas via its subsidiaries Gasunie Transport Services B.V. (GTS) in the Netherlands and Gasunie Deutschland in Germany. The company also offers other services in the energy infrastructure field, including hydrogen, heat, CCS, gas storage and LNG. Gasunie commits itself to accelerating the energy transition and to the realization of a climate neutral energy supply. For more information, go to www.gasunie.nl.
About GRTgaz
GRTgaz is a world expert in gas transmission networks and systems and a leading European gas transmission system operator. In France, GRTgaz owns and operates more than 35,000 km of buried pipes and 26 compression stations used to ship gas between suppliers and consumers. GRTgaz is committed to ensuring security of supply to consumers, connecting territories and communities with great care for the environment. GRTgaz delivers innovative and accessible solutions to accelerate and secure a successful energy transition by connecting the energies of tomorrow, driving the growth of renewables and new uses for gas while fostering synergy between electricity and gas systems. For more information, go to www.grtgaz.com.
About Hellenic Gas Transmission System Operator (DESFA) S.A. is responsible for the operation, management, use and development of the Hellenic National Natural Gas System. DESFA is a reliable partner in the framework of the ongoing international energy projects in Southeastern Europe. DESFA is committed to support the fulfilment of the National Energy & Climate Plans targets, by planning its energy transition towards the decarbonize economy. For additional information, please visit the following website: www.desfa.gr.
About Nordion Energi
Nordion Energi, is specialized in gas infrastructure with the aim to drive the energy transition and becoming the first gas grid in Europe with 100% green gas. We operate the gas grid in Sweden, which extends from Dragör in Denmark to Stenungsund in Sweden and transports energy to distributors and customers with direct links. The gas grid supplies 33 municipal areas and several combined heat and power plants and is also used in more than 34,000 households and in the transport sector. For more information, go to www.swedegas.com or www.nordionenergi.se/en.
About ONTRAS
ONTRAS Gastransport GmbH is a German gas transmission system operator in the European gas transport system based in Leipzig. ONTRAS operates Germany’s second-largest gas transmission system, with approximately 7,000 km of pipelines and about 450 interconnection points. The green side of ONTRAS has been at the heart of our company culture for many years. Our goal is to reach a 100% carbon-neutral gas supply by 2050. There are currently 22 biogas plants connected to the ONTRAS transmission network injecting 180 million cubic meters of biomethane every year – approximately 17% of the total German biomethane in the gas network. Furthermore, two power-to-gas facilities are currently connected to the ONTRAS network converting electricity generated by wind turbines into hydrogen which is then injected into our grid. We work together with a variety of partners to examine the possible application of hydrogen and explore the massive potential of our own infrastructure for the transport of renewable energy. For more information, go to www.ontras.com.
About OGE
With a gas transmission system spanning 12,000 kilometres, OGE, seated in Essen, is among Europe’s leading transmission system operators. Two thirds of natural gas consumed in Germany flows through our pipeline system, comprising about 100 compressor units and about 1100 exit points. All over the country, our approximately 1,450 staff ensure safe, environmentally friendly and customer-oriented gas transmission. We also offer the technical and commercial services to go with it, and we provide commercial, technical and IT services for other companies on the basis of third-party arrangements. Moreover, we actively support the European gas market and work together with the European distribution network operators to create the prerequisites for transnational gas transportation and trading. For more information, go to https://oge.net/en.
About Snam
Snam is one of the world’s leading energy infrastructure operators and one of the largest Italian listed companies in terms of market capitalization. Through its international subsidiaries, it also operates in Albania, Austria, China, France, Greece, India, UAE and UK. The company has the largest natural gas transmission network and storage capacity among European peers and is also one of the main operators in regasification. As part of a €7.4 billion plan to 2024, Snam invests to make its infrastructure hydrogen ready and develop new energy transition businesses such as sustainable mobility, biomethane and energy efficiency. Snam also aims to enable and promote the development of hydrogen to foster decarbonisation in the energy sector and industries. Snam’s business model is based on sustainable growth, transparency, the promotion of talent and diversity and the social development of local areas through the initiatives of Fondazione Snam. For more information about the company, please visit www.snam.it.
About Teréga
Teréga has a network of more than 5,000 km of pipelines and two underground storage facilities, representing 16% and 24% of national capacity respectively. Teréga is a major player in energy and has been located in South-West France for over 70 years. As part of its public-service obligations, Teréga transports natural gas to more than 400 delivery stations in the most secure, cost-effective, and reliable conditions. Teréga enjoys a strategic position in Europe, where it provides interconnections that guarantee security of supply. Teréga is aware of the vital role of renewable gases in the energy transition. Teréga wants to help accelerate the green revolution through increasing involvement in biomethane, natural gas for vehicles, and Power to Gas. For more information, go to www.terega.fr.
For questions about the study, please reach out to: Jaro Jens – jjens@guidehouse.com
About Guidehouse
Guidehouse is a leading global provider of consulting services to the public and commercial markets with broad capabilities in management, technology, and risk consulting. We help clients address their toughest challenges with a focus on markets and clients facing transformational change, technology-driven innovation and significant regulatory pressure. Across a range of advisory, consulting, outsourcing, and technology/analytics services, we help clients create scalable, innovative solutions that prepare them for future growth and success. Headquartered in Washington DC, the company has more than 7,000 professionals in more than 50 locations. Guidehouse is led by seasoned professionals with proven and diverse expertise in traditional and emerging technologies, markets and agenda-setting issues driving national and global economies. For more information, please visit: www.guidehouse.com
