The unique advantages of e-methane

E-methane, a synthetic gas that holds immense potential for the future of energy, is quickly gaining global attention

Although the commercial production of e-methane has yet to begin, the momentum behind this innovative technology is growing rapidly.

E-methane is produced through a process that combines low-emission hydrogen with a carbon source, such as captured CO2 or biomass. This process results in a synthetic gas that closely mimics the physical and chemical properties of conventional natural gas.

The growing interest in e-methane is driven by its potential to play a critical role in the energy transition. As the world seeks to reduce its reliance on fossil fuels and lower greenhouse gas emissions, the need for low-emission alternatives to natural gas is becoming increasingly urgent. E-methane offers a unique advantage in this regard. It can be used within the existing methane network, providing a way to decarbonise natural gas without the immediate need for new infrastructure investments.

Furthermore, e-methane could serve as a bridge between today’s methane networks and the hydrogen networks of the future. Hydrogen is often touted as a key component of the future energy system, but its widespread adoption is hindered by challenges related to storage, transportation, and infrastructure compatibility. E-methane, which behaves almost identically to natural gas, could ease the transition to a hydrogen-based energy system by allowing for a gradual integration of hydrogen into existing gas grids.

Unlike hydrogen, which requires advanced and costly storage solutions, e-methane can be stored on a large scale in existing infrastructure, such as depleted natural gas fields and underground aquifers. This ability to store e-methane in significant quantities makes it an ideal solution for addressing seasonal energy demand variations. During periods of high demand, stored e-methane can be released into the grid, ensuring a reliable supply of energy even when renewable sources like wind and solar are not producing at full capacity.

The economic challenge

Despite its many advantages, e-methane faces a significant hurdle: cost. The current levelised cost of e-methane is estimated to range between US$50 and US$200 per million British thermal units (MMBtu), which is substantially higher than traditional natural gas prices or landed LNG prices. For e-methane to become a viable alternative to natural gas, substantial reductions in production costs are necessary.

This cost challenge is not insurmountable, but it will require significant advancements in technology and economies of scale. By 2040 or 2050, it is anticipated that the cost of e-methane could be reduced to a level that makes it competitive with traditional natural gas, particularly as carbon pricing and other regulatory measures increasingly penalise the use of fossil fuels.

In the meantime, the first e-methane projects are beginning to take shape. Japan has emerged as a leading proponent of e-methane, viewing it as a critical component of its energy strategy. The country has set an ambitious target: by 2050, 90% of city gas demand is expected to be met by e-methane. This commitment is driven by Japan’s need to secure a stable and low-carbon energy supply, as the country seeks to reduce its dependence on imported fossil fuels and meet its climate goals.

E-methane looks to become a key player in the global energy transition. Its compatibility with existing gas infrastructure, ability to serve as a bridge to a hydrogen-based energy system, and potential for large-scale storage make it an attractive option for decarbonising the natural gas sector.

This article is authored by Synergy Consulting IFA