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Consumers Energy will target methane leaks in its system and buy renewable natural gas to offset what it can’t plug.
Michigan’s largest utility says it will eliminate methane emissions from its natural gas delivery system over the next decade.
Consumers Energy CEO Patti Poppe announced the company’s pledge in an Oct. 24 earnings call. The company plans to achieve net-zero methane emissions from its gas transmission, distribution and storage operations by 2030.
“To achieve our goal, we’ll continue to accelerate the replacement programs we already have in place, protect our assets with increased damage prevention and apply new technologies to identify and eliminate fugitive methane emissions,” Poppe said during the call.
Consumers’ plan calls for an 80% reduction in methane leaks from its gas delivery system from 2011 levels by 2030. The remaining 20% will be offset by purchasing renewable natural gas, which is captured from farms, landfills and wastewater treatment facilities.
Gas distribution and storage make up less than one-fifth of the oil and gas supply chain’s methane emissions — most come from “upstream” sources like well production sites. Still, experts say Consumers’ plan is a substantial climate commitment.
“Emissions abatement anywhere is a helpful thing for the climate,” said Daniel Raimi, senior research associate at Resources for the Future and author of “The Fracking Debate.” “If Consumers is able to substantially reduce its own methane emissions in a cost-effective way, that’s certainly a win for climate change even if they account for a relatively small amount of the problem.”
Consumers’ methane plan comes as natural gas increasingly draws the ire of environmental groups due in part to the sector’s methane emissions.
Methane is a powerful greenhouse gas that fades faster from the atmosphere but is also more effective at trapping heat compared to carbon dioxide. Carbon dioxide is also emitted when the fuel is burned in power plants or furnaces, though less than what is released from burning other fossil fuels.
At a meeting in Orlando, Florida, this past week, executives at U.S. investor-owned utilities also pledged to measure and disclose methane emissions from their natural gas suppliers, reportedly as a plan to justify and maintain natural gas operations amid the clean energy transition.
Consumers is also joining that initiative, which is being led by the Edison Electric Institute and American Gas Association. Consumers doesn’t own natural gas production or gathering operations, but it can work with suppliers who make emission-reduction commitments.
“We have purchasing power, and we can choose to purchase from suppliers that are being environmentally responsible,” said Linda Hilbert, Consumers’ executive director of environmental services.
How it will happen
Consumers has reduced methane emissions from its natural gas delivery system 10% since 2011 by replacing distribution pipelines and retiring “unnecessary infrastructure,” which emit the majority of methane on the company’s system.
That year, Consumers began its Enhanced Infrastructure Replacement Program to replace pipelines connecting the transmission system to service lines. In 2017, Consumers started replacing vintage service lines that deliver natural gas to customers. The utility plans to ask regulators’ permission to accelerate those programs as part of a 10-year, $25 billion capital expenditure plan.
Also in 2017, Consumers started a program to rehabilitate natural gas storage wells and protect wellheads from third-party damage. Reducing venting — which releases natural gas to lower pressure in gas pipelines — through temporary compressor technology has also been a part of Consumers’ methane-reduction plans.
Despite those efforts, “We must do more to reach a net zero methane emissions goal,” the company’s plan says. Last year, the company formed a task force to explore ways of reducing methane emissions, which will include reducing damage from third parties and bolstering leak-detection programs.
These steps are also recommendations made in a 2018 study published in the journal Science.
“Substantial emission reductions are feasible through rapid detection of the root causes of high emissions and deployment of less failure-prone systems,” the study says.
Raimi said the 2018 report is the “best available evidence to date” on the quantity and sources of methane emissions in the oil and natural gas supply chain.
The study found that the sector’s methane emissions are about 60% higher than previously estimated by the U.S. Environmental Protection Agency.
The Trump administration has attempted to roll back several Obama-era climate regulations, including those meant to curb methane emissions like monitoring and repairing leaks.
However, the industry is increasingly making voluntary commitments to curb methane emissions.
The Oil and Gas Climate Initiative — whose members include major companies like BP, Chevron, Shell and ExxonMobil — was formed in 2014 and plans to cut its members’ methane emissions by more than one-third by 2025.
E&E News reported this week that investor-owned utilities are looking to cut methane emissions by having their natural gas suppliers measure and disclose emissions through a Natural Gas Sustainability Initiative. The initiative, now in a draft phase, is reportedly a joint venture between the American Gas Association and the Edison Electric Institute.
DTE Energy, Michigan’s other large utility, plans to participate in the initiative to “make it clear we are on the climate change train,” DTE’s president and CEO reportedly said.
In the earnings call, Poppe said “pressure from the environmental community in general on natural gas” is part of the “spirit” of the company’s methane reduction plan.
“We can see the use of [renewable natural gas] in the natural gas system to minimize the kind of emissions and help to mitigate the environmental pressures,” Poppe said.
Catherine Hausman, a professor at the University of Michigan’s Gerald R. Ford School of Public Policy, said voluntary methane commitments from companies involved in the natural gas supply chain are increasingly common.
But Hausman said voluntary goals are “clearly not enough at … any part of the supply chain” to cause widespread emission reductions.
“The simple fact is, not all companies are engaging in them — and there are a lot of upstream and distribution companies,” Hausman said.
Companies make these pledges often to save their product from leaking out of the system. But the economic and climate impacts of those emissions are far greater than the loss of product for companies, Hausman noted.
Pledges like Consumers’ can “move the needle forward in the aggregate,” but federal regulation is needed for widespread emission reductions, she said.
“I applaud voluntary initiatives, but I don’t think they let regulators off the hook,” she said.
Raimi agreed: “Any large-scale methane solution will need to be driven by public policy rather than voluntary industry commitments.”