In the context of the Fit for 55 and the upcoming Green Gas Package, COGEN Europe joins industry stakeholders in calling for for a European Union (EU) policy framework that promotes the production, market uptake and system integration of renewable and decarbonised gases. The upcoming Green Gas Package will play a key role in aligning gas market regulation with the delivery of the European Green Deal to speed up the decarbonisation of all sectors, including buildings, at the lowest cost for EU consumers.
Fostering efficient system integration
The decarbonisation challenge is a systemic issue, which requires a systems’ approach. Planning for a net-zero emissions future should integrate energy systems across electricity, heat and gas networks. This is why putting energy efficiency first must go beyond the single appliance approach and favour system efficiency to ensure lowest cost for consumers and society alike.
From this perspective, a power-to-gas project combined with cogeneration will deliver significant system efficiency benefits by providing seasonal storage, energy savings, renewable energy integration and security of supply. Defining and implementing system efficiency will help identify synergies and highlight positive externalities of clean energy solutions, accounting for local circumstances, combining green gases, efficient CHP, district heating, electrification, variable renewables and considering the value of existing infrastructure.
In addition to system efficiency, the Fit for 55 packages must prioritize the efficient use of all gases. Gas-based cogeneration solutions are “no regrets”. They can be compatible with different types of gases and will accept varying blends of hydrogen. Once renewable and decarbonised gases become available, using them with high-efficiency cogeneration ensures that these valuable resources are not wasted. Therefore, high-efficiency cogeneration must be consistently promoted across EU legislation, including in the Green Gas Package but also via the Energy Efficiency Directive, the Renewable Energy Directive, Energy Labelling and Energy Performance of Buildings Directive.
Accelerating the abundant and affordable uptake of green gases
Today gas is affordable, reliable and adaptable to diverse customer needs. Moreover, it can be combined with efficient and hybrid solutions to deliver immediate emission cuts (such as solar, hybrid heat pumps and cogeneration). The existing gas grids can integrate and store large quantities of renewable energy cost-effectively and for a long term, reducing the need for costly power grids reinforcements and battery storage deployment. In the medium to long term, the affordability of gas will be impacted by carbon pricing policies as well as the price evolution of green gases.
EU and national roadmaps, including targets and support measures, for decarbonising gas are needed to ensure investor certainty across the entire value chain. The gas sector will need to scale up the production and reduce the cost of new gases. On the demand side, gas users also need certainty that green gases will be available and affordable in the future. To stimulate demand, both industrial and residential consumers should be incentivised to switch t cleaner fuels as well as to higher efficiency and future proof equipment. Moreover, solution providers require predictable regulation, robust standards and updated state aid rules to adapt their technologies to new gas quality specifications as well as H2 readiness.
Creating local economy synergies
EU industry is committed to reaching carbon neutrality by 2050, while boosting its competitiveness worldwide and fostering local economy ambition. There is a strong manufacturing base of cogeneration solutions in the EU, with state-of-the-art solutions being produced in Europe by highly skilled workers. Moreover, the cogeneration project developers and operators create local green jobs and empower consumers. Industrial sites use cogeneration in pulp and paper, chemical sector, food & drink, alumina production and others, creating jobs and contributing towards local system integration.
The emergence of green gases offers opportunities in the area of circular economy, including by producing biomethane as a by-product of the local agricultural and waste streams and using it efficiently with cogeneration. Green gases blended into existing gas grids can help decarbonize many cities and buildings more cost-effectively and at a faster pace than by switching to a different energy vector. In addition, off-grid remote and rural areas can benefit from fuel cell micro-CHP running on bio-LPG.
An ambitious move towards green gases, used efficiently, is key for the decarbonisation of the entire economy, contributing towards a diversified, economically, and environmentally sustainable energy mix that guarantees security of supply. The Green Gas Package should therefore provide an enabling framework for industry to deliver on the Fit for 55 higher ambition.