Environmental advocates are hailing Massachusetts regulators’ decision to reject a proposal for utility sales of renewable natural gas, though they caution that the reasoning behind the decision leaves room for future attempts to promote the fuel.
The state Department of Public Utilities last month denied a request by gas company Liberty Utilities to sell renewable natural gas — a fuel widely opposed by climate advocates — to customers in two southeastern Massachusetts cities. The decision, however, focused on issues of reliability and cost rather than environmental implications, leaving those arguments to play out in future proceedings and creating an opportunity for utilities to test out new proposals.
“I think the door is still pretty much open,” said Priya Gandbhir, a staff attorney with the Conservation Law Foundation, which intervened in the case, arguing against the utility’s plan.
Renewable natural gas is generated by the decomposition of organic materials such as garbage in landfills, animal manure, and wastewater sludge. The captured gas is upgraded to increase the percentage of methane it contains, creating a fuel that is chemically identical to conventional natural gas.
Supporters argue that renewable natural gas production reduces the amount of methane — a potent greenhouse gas — that reaches the atmosphere and is thus a clean, climate-friendly choice. Opponents note that renewable gas is expensive to create, still generates emissions when burned, and still leaks out of aging pipes, just like the fossil fuel version.
“It’s not cost-effective and it doesn’t have any climate benefits,” Gandbhir said.
The ruling
As Massachusetts tries to reach its goal of net-zero emissions by 2050, the future of its natural gas system has been a major conversation among climate and energy advocates, officials, and businesses. In 2020, the state opened an investigation into the role of natural gas utilities in reaching this goal. The process has been spearheaded by the state’s five major natural gas distribution companies, which have pushed for renewable natural gas to play a significant role in decarbonizing the energy system.
Liberty Utilities’ proposal, filed in March 2022, was the first to test the potential of the idea. The utility laid out a plan to enter into a 20-year contract to buy renewable natural gas from a company called Fortistar, which would generate its supply by recapturing and processing gas released from a landfill in the city of Fall River.
Liberty would then create a program offering customers in Fall River and the neighboring town of North Attleborough the chance to buy renewable natural gas representing all, half, or one-quarter of their total natural gas usage. Liberty argued that this plan would help the state meet its climate goals and make its supply of gas more stable and cost-effective, particularly at times of peak demand.
In December, regulators rejected the plan. The state noted that the proposed contract was not structured to ensure there would be more gas available at times of peak demand, undermining the utility’s claim that the arrangement would improve its reliability. Because the state intended to reject the proposal on those grounds, there was no need to assess Liberty’s environmental claims, the ruling concluded.
Liberty Utilities expressed disappointment in the decision but reiterated its view that renewable natural gas can improve reliability and contribute to decarbonization.
“This is the right thing to do as we continue to provide safe and reliable natural gas service to our customers,” the company said in a statement. “It is also a key component of our plan to help the Commonwealth achieve its climate goals.”
Environmental impacts
Environmental advocates disagree.
Liberty’s specific plan sparked skepticism because the utility intended to let Fortistar retain any renewable energy credits earned by the facility and sell them to other entities that want to offset their own emissions. Therefore, advocates said, marketing the gas to Massachusetts buyers as an environmentally friendly product is disingenuous at best and perhaps even a breach of consumer protection laws.
“Customers who would be paying a premium thinking they were purchasing renewable natural gas, were really buying [conventional] natural gas,” said Sarah Krame, an attorney with the Sierra Club, another organization that argued against Liberty’s proposal. “That was incredibly misleading to customers.”
Others contend that building a renewable natural gas production facility would make the landfill even less climate-friendly than it is currently. Today, the landfill uses the gas it emits to power a 3.4-megawatt onsite power plant. The proposed facility, however, would use roughly 1 megawatt of electricity. This disparity makes it even less likely the new system would contribute to reduced emissions, said Michael J. Walsh, an independent decarbonization consultant who testified in the case on behalf of the Conservation Law Foundation.
Fortistar argues that its current equipment is reaching the end of its useful life, and replacing it would not be financially feasible. The company says it will simply burn off the gas the site produces — a process known as flaring — if it cannot build the gas production facility. Walsh, however, argues that would put it out of step with other landfills in the region, most of which generate electricity with the gas they recapture.
Beyond the specifics of the Liberty proposal, advocates argue that injecting renewable natural gas into the existing gas distribution system simply can’t advance decarbonization given the state of the natural gas infrastructure in the state, some parts of which are more than 150 years old. Supporters of renewable natural gas argue that it can be considered a net-zero source of emissions, as the gas produced is offset by the methane kept out of the atmosphere by the process. Climate advocates, however, point out that the very leak-prone natural gas infrastructure will allow methane into the air, regardless of its original source.
“The leaks from distribution are just so high that it eviscerates the environmental benefits of renewable natural gas,” Krame said.
Advocates also contend that utilities are pushing for renewable natural gas as a way to prolong the profitable life of the infrastructure they already own.
“At the end of the day, they’re interested in perpetuating the gas business,” said Itai Vardi, a researcher with watchdog group the Energy and Policy Institute.
The advocates are not completely opposed to all use of renewable natural gas. They generally agree that there is a use for the fuel in certain hard-to-decarbonize applications, such as on-site industrial uses. They are, however, encouraged to see state regulators taking a serious, critical look at proposals to use the fuel in the natural gas distribution system.
“I don’t think the war is over,” Gandbhir said. “But it’s definitely a good sign.”