B.C. Government Takes Steps to Grow LNG, RNG Market

The government of British Columbia (B.C.) is taking action under the Climate Leadership Plan to support investments by natural gas utilities that will increase the use of liquefied natural gas (LNG) and renewable natural gas (RNG) in the transportation, marine and other sectors and reduce greenhouse-gas (GHG) emissions.

“We’re working with utilities to stimulate the use of LNG as a marine fuel in large, ocean-going ships and to increase the supply and use of renewable natural gas,” says Energy and Mines Minister Bill Bennett. “Building the market for B.C.’s abundant supplies of natural gas offers the opportunity to achieve significant GHG emissions reductions and supports jobs and economic opportunities in British Columbia’s natural gas sector.”

According to the government release, amendments to the Greenhouse Gas Reduction Regulation (GGRR) under the Clean Energy Act will enable utilities to increase incentives provided to shipping companies for the conversion of vessels to run on LNG, invest in LNG bunkering (marine fueling) infrastructure, and increase the supply and use of RNG.

Programs under the GGRR are funded by the utility, not the province, and thus, the amendments simply set the parameters for potential utility programs and investments that will reduce GHG emissions.

“We are creating market opportunities for British Columbia’s natural gas sector, offering utilities flexibility to create new incentive programs so we can continue to build a strong economy and a cleaner future,” says Deputy Premier and Minister of Natural Gas Development Rich Coleman.

As reported, converting just one ocean-going tanker, cruise ship or container ship to run on LNG instead of heavy fuel oil will reduce GHG emissions by about 93,500 tons per year, equivalent to taking over 19,800 vehicles off the road.

What’s more, increased use of RNG could result in up to 450,000 tons of GHG reductions per year in B.C.

Amendments to the GGRR will allow utilities to double the incentives available to convert vehicles and marine vessels to natural gas when the new incentives go toward vehicles using 100% RNG and enable utilities to recover the costs of acquiring and distributing RNG in rates.

“The provincial government’s leadership allows FortisBC to build upon existing programs supporting the natural gas for transportation and renewable natural gas sectors,” says Michael Mulcahy, president and CEO of FortisBC. “LNG for marine vessels ensures the international marine shipping industry has a cost-effective, clean-burning fuel with which to meet international emissions standards. Encouraging the development of renewable natural gas provides additional business opportunities for local waste producers, such as farms, landfills and wastewater treatment plants. These initiatives not only benefit our customers by optimizing our natural gas system year-round – they benefit all British Columbians by lowering operating costs for businesses and by reducing carbon emissions in our air.”

The GGRR was introduced in 2012 and already allows utilities to provide incentives for compressed natural gas and LNG in the transportation and marine sectors to reduce GHG emissions. The amendments increase the allowed expenditure limits and expand coverage of the regulation to include investments related to RNG.

To date, incentive programs under the GGRR have resulted in commitments for more than 600 natural gas vehicles and vessels.

“Natural gas is a clean and affordable source of energy, and the use of RNG in British Columbia is a win for the local economy and the environment,” says Pacific Northern Gas (PNG) president Leigh Ann Shoji-Lee. “PNG is proud to be working with the province, Skeena Sawmills, G4 Insights and the community to advance the supply and use of RNG. We are committed to advancing natural gas in the communities we serve and will continue to be an active partner with the B.C. government to achieve B.C.’s GHG reduction targets.”

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