Billions worldwide being invested in biogas

The renewable gas industry in New Zealand has a few challenges to overcome, however if we were to follow the money, biogas may be a sensible place to start. Oil and gas majors like Shell and BP have invested billions of dollars in biomethane.

Shell recently acquired Nature Energy, Europe's largest biomethane producer, while BP purchased US-based biomethane producer Archaea for $4.1 billion, and as Firstgas Group Future Fuels General Manager James Irvine says “It’s not only because they are over an oil barrel on renewables, there is growing demand for biogas”.

“Shell and BP both have significant trading and supply businesses, supplying renewable gas products to a vast number of customers – primarily industrial and commercial businesses including many multi-nationals.

“Right now they’re meeting demand by buying renewable gas from smaller producers of such gas. This is expensive, offers limited supply, and leaves them exposed as demand increases. They expect demand to keep growing, driven by their customers’ own decarbonisation agendas, so investing in an in-house biogas supply puts them in a stronger long-term position.

“They are looking ahead, and their forecasts are telling them that biogas will become a significant business for them.”

Similarly, Firstgas is themselves looking closely at the biomethane potential in New Zealand. Including upgrading existing sources of biogas and landfill gas so it can be injected into the pipeline network, supporting the development of new anaerobic digestion, and exploring the potential for other methods of biogas production such as from wood waste.

While there is a lot of work to be done before New Zealand reaches the scale of renewable gas projects that are emerging elsewhere in the world, James says we have great potential, especially due to the country’s abundant supply of organic feedstock.

Read the Firstgas blog to find out more from James on the latest global investments and what we can expect in New Zealand.