Trial to explore “green methane” as replacement for mains gas

The federal government will fund a trial of renewable methane production in Queensland, that could provide a pathway for a clean, like-for-like replacement to natural gas with alternatives derived from wind and solar.

Australian gas producer APA Group will develop a $2.2 million renewable methane demonstration project at the company’s Wallumbilla Gas hub near Roma in Queensland, that if successful, could provide a crucial new option for decarbonising the mains gas supply, as well as gas destined for export.

The Australian Renewable Energy Agency (ARENA) will chip in $1.1 million in funding to the APA Group led study, covering half of the total cost. APA Group will partner with Southern Green Gas to provide working demonstration of the renewable methane process.

The hub will produce up to 620 kg of hydrogen annually, which will be converted into the equivalent of 74 gigajoules of methane for injection into the East Coast Gas Grid. If successful, the demonstration project could be the first step towards a larger, commercial scale, plant.

The demonstration project is relatively unique in proposing to manufacture methane as the end product. Methane is a main component of natural gas, and will allow for a more direct substitution in the mains gas supply.

While there are numerous trials of the direct blending of renewable hydrogen in the mains gas supply, there are limits to the amount of hydrogen that can be mixed before the performance of gas appliances, like stoves and hot water systems, are impacted due to the different burn characteristics of hydrogen.

These limits can be as low as 5 to 10 per cent direct hydrogen mixing, and producing a supply of renewable methane would help to mitigate the performance issues.

The project proposes to use renewable electricity produced from solar PV to convert water into hydrogen using an anion exchange membrane (AEM) electrolyser. The hydrogen would then be converted into methane through a process that combines the hydrogen with carbon dioxide drawn from the atmosphere.

The methane output would have similar characteristics to that of conventional natural gas.

“Renewable methane is in effect indistinguishable from the methane that currently fills our natural gas pipelines. The gas network is expected to play a key role in supporting the decarbonisation of Australia’s energy system,” ARENA CEO Darren Miller said.

“This project will demonstrate the viability of producing renewable methane from solar power. Through a new and innovative approach, the project will capture moisture in the air to produce renewable hydrogen as a precursor to renewable methane.”

At scale, renewable methane has the potential to be a significant source of Australia’s future natural gas requirements all through the deployment of solar energy and capturing the water from the atmosphere. Renewable methane is compatible with Australia’s developing hydrogen sector in that known technologies can convert methane to hydrogen and vice versa,” Miller added.

APA Group sees the demonstration as providing an opportunity to boost the industry’s understanding of the role renewable gas could play in serving the mains gas supply, as well as the cost and technological challenges facing hydrogen production.

The project will also allow for an comparison of the benefits of producing renewable methane, as compared to the direct use of renewable hydrogen.

“ARENA’s support means we can work to understand the costs and benefits of generating renewable methane for use in the existing East Coast Gas Grid. This is a great example of government support for innovation in the Australian energy industry. APA is excited about its part in this process,” APA Group CEO Rob Wheals said.

“We know the science of producing methane. This unique project is the first step in testing whether it is possible on an industrial scale to create methane, using solar-generated electricity, water and CO2 from the atmosphere.”

“With this project we’re aiming to determine whether this carbon neutral process might be part of the green energy solution of the future, and if our pipelines can be used to transport pure renewable energy domestically or to be exported,” Wheals added.

Federal energy minister Angus Taylor said that the project would be a key step in growing Australia’s hydrogen supplies and improving the security of the energy system.

“It is great to see industry working on new methods to blend hydrogen into existing gas infrastructure by creating renewable methane. This type of innovative work is exactly what we need to see to grow our domestic hydrogen industry,” Taylor said.

“Integrating renewable energy sources into Australia’s gas distribution system is a crucial step in delivering long-term secure and reliable energy, and reducing emissions.”

The project is one of two hydrogen projects that have secured funding from ARENA on Friday, with a renewable hydrogen and ammonia project in Geraldton also receiving $1.71 million in grant funding.

ARENA has established a $70 million funding round, which will target the deployment of large-scale hydrogen electrolysers to build Australia’s hydrogen capacity.

ARENA is approaching the end of its funding allocations and Angus Taylor has flagged that a future decision about any further extension of ARENA funding would “be addressed in the most appropriate budget context.”

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