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Fuel Sustainability Brief: Natural Gas

Tuesday May 5, 2015

 



#Climate Change, #Energy and Extractives, #Future of Fuels



Why Natural Gas?

Natural gas can help reduce greenhouse gas (GHG) emissions from transportation, particularly when using renewable natural gas (RNG). Switching from diesel to natural gas could reduce GHG emissions by up to one-third from fossil sources; with RNG enabling greater than 100 percent reduction by avoiding emissions that otherwise would contribute to climate change. 1

Natural gas fuel costs less than diesel on an energy-cost basis and provides several air pollution benefits compared to many other fuels. However, natural gas vehicles are more expensive than diesel ones and infrastructure is not yet universal, while leaked methane introduces uncertainty into its climate benefits.2

Market Oulook

In the United States and Canada there are over 100,000 natural gas vehicles on the road and the shale boom has made fossil natural gas immediately abundant.3 Some fleet operators see a quick return-on-investment in natural gas vehicle investment premiums, such as heavy-duty trucks that travel tens of thousands of miles per year and pay-back in two years or less.4

Average U.S. retail prices for Compressed Natural Gas (CNG) were 37 percent lower than diesel in the five years since 2010 on an energy-cost basis.5 The price difference compared to diesel grew by 17.1 percent for CNG compared to averages for the previous 10 years.6 Over the next 25 years, CNG is expected to remain roughly $2 per diesel-gallon-equivalent less than diesel fuel, and infrastructure is expanding rapidly.7

Vehicle Applications

Natural gas can be used in transit and school buses, heavy-duty trucks and haulers, heavy-duty off-road vehicles (e.g., forklifts and mining equipment), and a small but growing number of passenger vehicles.8 Generally, CNG is better for light- and medium-duty vehicles and LNG is best for heavy- or long-haul (Class 8) transport along corridors with fueling infrastructure and for routes where increased tank weight makes operation economical (though duty cycle is the most important determinant of practical applications).9

 

Key Issues

Key Feedstock and Process Choices

Natural gas is derived from fossil fuels as well as renewable resources. Natural gas is primarily extracted as part of crude oil production or drawn from wells.10 In recent years, natural gas extraction through horizontal drilling and hydraulic fracturing has expanded rapidly. While shale gas supplied only 2 percent of U.S. natural gas production in 2000, it accounts for more than 40 percent today.11

RNG, also called biomethane or biogas, is produced from anaerobic digestion of organic materials, such as waste from food processing plants, landfills, livestock, and wastewater.12 RNG can be used to replace or comingle with natural gas derived from fossil sources, and there are thousands of waste facilities that could produce significant amounts of RNG across the United States.13 According to the U.S. Department of Agriculture (USDA), the United States has over 2,000 RNG sites, with a potential to deploy an additional 9,000 in the future.14 This scenario could displace 56 percent of natural gas consumption in the transportation sector, but estimates vary from 5–100 percent displacement.15 16 Electricity generation is also a beneficiary of growth in RNG.17

CNG, Liquified Natural Gas (LNG), and RNG can all be distributed in existing natural gas distribution infrastructure, yet natural gas infrastructure is not yet universally available.

Key Sustainability Opportunities and Impacts

Opportunitity: Climate Change

Switching from diesel to natural gas has the potential to reduce GHG emissions by 10-33 percent.1819 Emissions are significantly reduced compared to diesel when using RNG, which offers life‐cycle GHG emission reductions of 85‐90 percent compared to diesel, and upwards of 115 percent when using certain food and green wastes.20 Methane leakage throughout the natural gas lifecycle introduces uncertainty into these figures, and is addressed in more detail in the “Uncertainties and Unresolved Issues” section.


Opportunity: Air Pollutants

During combustion, natural gas produces lower emissions that contribute to air pollution compared to diesel. Specifically, natural gas produces a fraction of particulate matter, reduced NOx emissions of 24-45 percent, and lower carbon monoxide and volatile organic compound (VOC) emissions.21 22 However, recent U.S. emissions-control regulations on all tailpipes have reduced the air pollution reduction benefit provided by natural gas relative to diesel.23


Impact: Water Availability

In North America, water use for natural gas production from fracking typically runs from 2.3 to 5.6 million gallons of freshwater per well (based on one-time use), with more water needed for “refracturing” or for drilling and stimulating larger wells.24 Additionally, improper well construction can lead to leaching of the chemicals used in fracking and methane into groundwater.25 26 27

Key Uncertainties and Unresolved Issues

Uncertainty: Methane Leakage

Research suggests that switching to natural gas vehicles from diesel may not reduce GHG emissions as much as originally estimated. Methane that escapes during production, refining, distribution, and use is known as “leakage.”28 Current research suggests that keeping methane leakage from natural gas below 1.0 percent would ensure that GHG impacts from the natural gas system are less than diesel or coal.29 Studies are mixed, and show ranges below and above the 1.0 percent rate where emissions across the natural gas lifecycle tip from lower to higher GHG emissions than diesel.30 31

Uncertainty: Induced Seismicity

Increased earthquakes, referred to as induced seismicity, have been documented in a handful of cases related to hydraulic fracturing. Recorded earthquakes are of a relatively low magnitude; however, significant damage has occurred in some instances. Additional research is needed to fully understand earthquake frequency and impacts resulting from hydraulic fracturing. Specifically, more information is needed to identify fault lines prone to reactivate and factors that affect the size of felt earthquakes.32

Undertainty: Health Risks

The actual health risks of fracking remain poorly understood, and the chemicals and processes used in North America are not yet regulated comprehensively. One study found higher rates of respiratory illness and skin problems in people living close to natural gas wells in Pennsylvania, but there is a big gap in peer-reviewed research on health impacts.33 The U.S. Environmental Protection Agency is undertaking a comprehensive study that is expected to shed light on the health impacts of fracking.34

 

Sustainability Potential

Best Case

Natural gas from fossil sources can achieve 33 percent reductions in GHG emissions compared to diesel on a life-cycle basis when methane leakage is avoided. RNG from certain food and green waste can reduce GHG emissions by 115 percent compared to diesel. Zero-emissions controls can eliminate other air pollution during vehicle operation. Applying best practices for well construction and operation drastically reduces potential water and health impacts from fracking.

Best Practices

Prioritize Renewable Natural Gas (RNG)

Purchasing from suppliers that provide RNG can have substantial benefits, supporting an efficient fuel with low environmental impacts and requiring low upfront investment for fleets that use natural gas.35 Capture at landfills, agricultural operations, and other waste production and disposal facilities allow for the beneficial utilization of methane that would otherwise escape into the atmosphere as potent GHG emissions.36 These sources are renewable and, in the case of agricultural and industrial operations, have significant environmental benefits by redirecting waste that might otherwise contaminate soils and waterways.37


Invest in Methane Leakage Detection and Capture

While actual leakage rates are uncertain, any leakage that occurs increases the climate impacts from natural gas. There are, however, economically feasible technologies that can help significantly reduce upstream emissions.38 Companies should invest in methane detection and capture technologies, and encourage production and distribution practices that reduce methane leaks from natural gas.


Recycle Water and Use Efficient Production Practices

To mitigate the water requirements of hydraulic fracturing, companies should prioritize the use of recycled water for extraction and avoid using freshwater resources, a solution that has greatly increased in the industry.39 Companies ensure efficient production practices through proper well construction and continuously monitoring and maintenance of wells after drilling is completed.


Implement Practices that Reduce Risk of Induced Seismicity

There are five recommended steps to reduce induced seismicity: “(a) avoid injection into active faults or faults in brittle rock, (b) limit injection rates and formation types to minimize increases in pore pressure, (c) install local seismic monitoring arrays when there is seismicity potential, (d) establish protocols in advance to modify operations if seismicity is triggered, and (e) reduce injection rates or abandon wells if seismicity is triggered.”40

 

Join Us

This Fuel Sustainability Brief was researched and written by BSR’s Future of Fuels Collaborative Initiative.


Footnotes
  1. California Energy Commission (2014). “2014-2015 Investment Plan Update for the Alternative and Renewable Fuel and Vehicle Technology Program.”
  2. California Energy Commission (2014). “2014-2015 Investment Plan Update for the Alternative and Renewable Fuel and Vehicle Technology Program.”
  3. America’s Natural Gas Alliance (2013). “US and Canadian Natural Gas Vehicle Market Analysis: Heavy-Duty Vehicle Ownership and Production.” Final Report.
  4. California Energy Commission (2014). “2014-2015 Investment Plan Update for the Alternative and Renewable Fuel and Vehicle Technology Program.”
  5. Based on BSR analysis of US DOE Clean Cities Alternative Fuel Price reports. Data available at: www.afdc.energy.gov
  6. Based on BSR analysis of US DOE Clean Cities Alternative Fuel Price reports. Data available at: www.afdc.energy.gov
  7. America’s Natural Gas Alliance (2013). “US and Canadian Natural Gas Vehicle Market Analysis: Heavy-Duty Vehicle Ownership and Production.” Final Report.
  8. America’s Natural Gas Alliance (2013). “US and Canadian Natural Gas Vehicle Market Analysis: Heavy-Duty Vehicle Ownership and Production.” Final Report.
  9. U.S. Department of Energy (2014). “Natural Gas Fuel Basics”. Alternative Fuels Data Center. Available at: www.afdc.energy.gov
  10. U.S. Department of Energy (2014). “Natural Gas Fuel Basics”. Alternative Fuels Data Center. Available at: www.afdc.energy.gov
  11. U.S. Energy Information Administration (2014). “Market Trends: Natural Gas.” Annual Energy Outlook 2014. Available at: www.eia.gov
  12. U.S. Department of Energy. “Renewable Natural Gas (Biomethane).” Alternative Fuels Data Center. Available at: www.afdc.energy.gov
  13. California Bioenergy Interagency Working Group (2012). “2012 Bioenergy Action Plan.” Available at: www.resources.ca.gov
  14. U.S. Department of Agriculture, U.S. Environmental Protection Agency, U.S. Department of Energy (2014). “Biogas Opportunities Roadmap.” Available at: www.epa.gov
  15. National Renewable Energy Laboratory, (2013) “Energy Analysis: Biogas Potential in the United States,” available at www.nrel.gov
  16. Dodge, Edward (2014). “How Much Renewable Natural Gas Can Be Produced?” Available at: theenergycollective.com
  17. U.S. Department of Agriculture, U.S. Environmental Protection Agency, U.S. Department of Energy, (2014). “Biogas Opportunities Roadmap.” Available at: www.epa.gov
  18. California Energy Commission (2014). “2014-2015 Investment Plan Update for the Alternative and Renewable Fuel and Vehicle Technology Program.”
  19. U.S. Department of Energy (2014). “Natural Gas Fuel Basics”. Alternative Fuels Data Center. Available at: www.afdc.energy.gov
  20. California Energy Commission (2014). “2014-2015 Investment Plan Update for the Alternative and Renewable Fuel and Vehicle Technology Program.”
  21. Lyford-Pike, E.J. (2009). “An Emission and Performance Comparison of the Natural Gas C-Gas Plus Engine in Heavy-Duty Trucks.” Available at: www.afdc.energy.gov
  22. U.S. Environmental Protection Agency (1995). “Emissions Factors & AP 42, Compilation of Air Pollutant Emission Factors.” Available at: www.epa.gov
  23. U.S. Energy Information Administration (2014). “Market Trends: Natural Gas.” Annual Energy Outlook 2014. Available at: www.eia.gov
  24. Jackson, R.B., et al. (2014). “The Environmental Costs and Benefits of Fracking: Annual Review of Environment and Resources.”
  25. NPR (2014). “Tap Water Torches: How Faulty Gas Drilling Can Lead To Methane Migration.” State Impact: A reporting project of NPR member stations (Pennsylvania). Available at: stateimpact.npr.org
  26. Jackson, R.B., et al. (2014). “The Environmental Costs and Benefits of Fracking: Annual Review of Environment and Resources.”
  27. Schornagel, et al. (2012). “Water Accounting for (Agro)industrial Operations and Its Application to Energy Pathways” Resources, Conservation and Recycling. 61 (2012) 1-15.
  28. Brandt, A.R., et al., Science Magazine (2014), “Methane Leaks from North American Natural Gas Systems.”; Miller, S., et al. Proceedings of the National Academy of Sciences (2013), “Anthropogenic emissions of methane in the United States.”
  29. Bradbury, J., and Obeiter, M. (2013). “Clearing the Air: Reducing Upstream Greenhouse Gas Emissions from U.S. Natural Gas Systems.” World Resources Institute.
  30. Brandt, A.R., et al., Science Magazine (2014), “Methane Leaks from North American Natural Gas Systems.”; Miller, S., et al. Proceedings of the National Academy of Sciences (2013), “Anthropogenic emissions of methane in the United States.”
  31. Brandt, A.R., et al., Science Magazine (2014), “Methane Leaks from North American Natural Gas Systems.”; Miller, S., et al. Proceedings of the National Academy of Sciences (2013), “Anthropogenic emissions of methane in the United States.”
  32. Jackson, R.B., et al. (2014). “The Environmental Costs and Benefits of Fracking: Annual Review of Environment and Resources.”
  33. Rabinowitz, P. M., et al. (2014). “Proximity to Natural Gas Wells and Reported Health Status: Results of a Household Survey in Washington County, Pennsylvania.” Environmental Health Perspectives. DOI:10.1289.
  34. Description and latest results of the study to be posted at: www2.epa.gov
  35. U.S. Department of Agriculture, U.S. Environmental Protection Agency, U.S. Department of Energy, (2014). “Biogas Opportunities Roadmap.” Available at: www.epa.gov
  36. BU.S. Department of Agriculture, U.S. Environmental Protection Agency, U.S. Department of Energy, (2014). “Biogas Opportunities Roadmap.” Available at: www.epa.gov
  37. U.S. Department of Agriculture, U.S. Environmental Protection Agency, U.S. Department of Energy, (2014). “Biogas Opportunities Roadmap.” Available at: www.epa.gov
  38. Brandt, A.R., et al. (2014). “Methane Leaks from North American Natural Gas Systems.” Science. Vol. 343: 733-735
  39. Jackson, R.B., et al. (2014). “The Environmental Costs and Benefits of Fracking: Annual Review of Environment and Resources.”
  40. Zoback MD. (2012). “Managing the seismic risk posed by wastewater disposal.” Earth 57: 38-43.

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