It’s expected to be a record year for Responsibly Sourced Gas, with supply forecast to reach more than 20 Bcf/d by the end of the year, which is almost one-fifth of the North American market. While many producers have wholeheartedly embraced RSG, utilities have been slightly more resistant to the movement because of the associated premiums and their obligation to be a low cost provider for their customers. However, a landmark decision by the Federal Energy Regulatory Commission (FERC) will now make sourcing RSG easier for end-users such as utilities, power plants, and LNG facilities.
On July 1, FERC granted approval to the Tennessee Gas Pipeline Company (TGP) for its RSG aggregation pooling service, which will now be available at all pooling points across the TGP system, which is a 11,760-mile conduit that transports fuel from the northeast to the Texas Gulf Coast. This means shippers on TGP will be able to purchase and sell RSG supply at non-physical pooling locations. A shipper’s gas can qualify for the pooling location if it has met the certification standards of Project Canary or MiQ, while gas that has been registered with Xpansiv’s Digital Fuels Program may also qualify.
A similar development for RSG could be on the horizon as Williams Cos., which moves about a third of US natural gas through more than 30,000 miles of pipelines, is working with Context Labs to develop a platform that will allow buyers to set up gas deliveries based not only on the producer’s location but also on the fuel’s verifiable emission profile.
Indeed, this Decarbonization as a Service™ (DaaS™) technology solution, which is already underway in the Haynesville region in east Texas and northern Louisiana, will simplify and enable the gathering, marketing and transporting of RSG from well-head to end-user to meet real-time clean energy needs across the US.
A pathway to net-zero targets
As RSG becomes easier to obtain, utilities should seize this opportunity to make headway on achieving their net-zero targets. Switching to RSG from industry average gas can reduce emissions by more than 80% and carbon footprint by up to 18%. Indeed, RSG offers utilities an opportunity to demonstrate authenticity to their customers and make a meaningful, low cost commitment to decarbonization.The Global Methane Pledge that was signed by over 100 countries at COP26 requires the reduction of human-made methane emissions by at least 30% by 2030 from 2020 levels. It is important that firms do not delay taking action on this commitment. RSG, which is now easier to procure than ever before, offers a clear pathway for utilities to reach this goal and accelerate the clean energy transition.