Natural gas utilities are playing a critical role in the journey toward decarbonizing the U.S. economy by 2050. And, as highlighted in Net-Zero Emissions Opportunities for Gas Utilities—a 2022 study conducted by consulting firm ICF for the American Gas Association—they are discovering that there are many ways to get there.
Much more work has been undertaken since that initial report came out. Utilities that have long been on the path to net zero and carbon neutrality are more dedicated than ever to reaching ambitious emissions-reduction goals by or before 2050, taking unique approaches as they continue to learn invaluable lessons on this journey.
When Southern California Gas Company announced its goal to be net zero across all Scope 1, 2 and 3 emissions by 2045—the year California has set for reaching net zero statewide—the utility saw an opportunity to “lean in and show that a gas utility can help the state move forward,” said Jawaad Malik, SoCalGas chief strategy and sustainability officer.
That “leaning in” led the utility to consider studies and analysis that not only explored the ways SoCalGas could reach net zero but also underscored the role natural gas utilities in general could play in helping the entire state attain net zero in a more affordable, more efficient and more resilient manner.
“Our first step was to make sure that we had quantitative analysis of the current situation,” Malik said. “We looked at pathway studies from the California Energy Commission and California Air Resources Board. We also commissioned our own study, to better understand the potential role of a gas infrastructure in the decarbonization process.” Once SoCalGas conducted an in-depth review of its emissions, that initial analysis helped to shape the utility’s plans going forward.
In the Midwest, a comprehensive emissions assessment was also Spire’s first step. When senior leadership at Spire committed to its becoming a carbon-neutral company by 2050, they tasked Nick Popielski, now vice president of sustainability, to develop the long-term road map to get the company there.
“We focused on measuring Scope 1 and 2 emissions across all of our facilities to determine our existing carbon footprint,” Popielski said. “Of course, we’ve been measuring and reporting emissions to the U.S. Environmental Protection Agency for many years as part of doing business in the natural gas industry. But we hadn’t taken a comprehensive look at all the emissions across everything we do.”
For a natural gas utility, the bulk of its emissions are related to its pipeline system, added Popielski. “That’s where we’ll need to put a lot of the effort,” he said. “But when you start digging into all the components—facility, fleet, storage, transportation—you start uncovering other things as well. And you start asking questions, like, ‘Do we need to idle our vehicles as much as we do? Are there better ways to manage that?’ Digging into those kinds of questions and [how to best manage] the opportunities they present is what we’ve been working on over the last couple of years.”
These questions and the opportunities they present have been driving some of the initial steps at Duke Energy as well.
In 2020, Duke Energy announced its natural gas business unit’s goal to achieve net-zero Scope 1 emissions by 2030. In 2022, that goal was expanded to include net-zero Scope 3 upstream emissions from purchased natural gas and downstream emissions from customers’ consumption of natural gas sold by 2050. Once the company knew it needed to move beyond what Senior Vice President and President of Duke Energy Natural Gas Business Sasha Weintraub calls a “desktop calculation” of its emissions—a number based on miles of pipe, number of meters, etc.—it began working toward real-time emissions monitoring. As it gained a deeper understanding of its system, the utility couldn’t help but wonder: Are there some emissions situations we can solve simply by working smarter?
“For example, we asked if we could stop flaring or emitting methane when we do maintenance work,” Weintraub said. “The answer is yes. Now, whenever we have to empty out a pipe for maintenance, instead of either flaring or venting the natural gas, we use cross compression to put it back into the pipeline system.”
The questioning also led to a reassessment of Duke Energy’s approach to emissions detection. “We were walking our distribution system, per regulation, every five years to try to find any leaks,” he said. “We asked, ‘Why not do that more frequently?’ So, we started walking our system every three years. And that, ultimately, led us into our advanced methane leak detection work,” which is based on innovative technologies.
While evaluating newer technologies to detect methane emissions along its distribution system, Duke Energy learned that satellites could be used to pinpoint emissions that might otherwise go unnoticed.
At first, there was skepticism. “Our technicians on the ground couldn’t believe that a satellite would be capable of detecting such small, nonhazardous leaks—really tiny, pinhole leaks,” Weintraub recalled. “That led us to develop a white paper, with Colorado State University, that shares some of the double-blind studies we conducted to show that the satellite does work and that it is, in fact, a better technology for detecting leaks than current methodologies.” A series of successful pilot programs focused on limited service areas sealed the deal.
“With the satellite technology, we don’t need to spend so much time finding the leak; we can shift our resources to fixing the leak,” Weintraub said. He notes that Duke Energy has reduced its leak inventory by approximately 85% since January 2022.
The utility is also testing the use of permanent, fixed sensors at its compressor stations and liquefied natural gas facilities. “[These] should give us the ability to detect leaks all the time, anytime,” Weintraub explains. “We expect them, along with regular satellite monitoring, to become part of our ongoing maintenance. We believe that this will do everything currently possible to detect methane leaks and allow us—in a very timely fashion—to fix them, so that we’re maintaining net zero all the time.”
Where Duke saw an opportunity, it then gathered detailed knowledge and put a financially responsible plan in place. Likewise, for other utilities, defining key areas, then evaluating and prioritizing what can be done in these key areas, are important next steps, Popielski said. For example, he describes a series of practical emissions-reduction strategies currently underway at Spire.
“We found that about 70% to 75% of our total emissions come from leaks in our local distribution companies’ system. So, we’re looking at what we can do to improve that,” he said. “We’ve done tests with cross compression. We are in the process of pipeline replacement, which is accelerating our reductions very well. We’re in the process of upgrading our meters in many jurisdictions. And we’re starting to look into components of advanced leak detection, which would allow us to look proactively at what emissions are coming off of our systems that we may not hear about from our customers.”
Like other utilities across the country, Spire’s emissions reduction strategy includes a role for renewable natural gas as well.
“We are fortunate to have helped pass some legislation in Missouri that allows us to include capital deployed for renewables within a rate base,” Popielski explained. “It directs our regulators in the state to establish rulemaking and tariffs that will allow us to sell RNG to our firm customers. It’s a great situation because it allows us to explore renewables in the broad sense of the term within our regulated utilities. A couple of other states have this, but I think our approach in Missouri is unique.”
He pointed out that much of the RNG produced in the United States comes along with carbon credits. “The biggest market for most of that ends up being California, but we serve Missouri, Alabama, Mississippi,” he said. “We want to enable Missourians to purchase Missouri RNG at Missouri prices. We want to find a way to make this make sense for people in Missouri through this legislation.”
At SoCalGas, the utility is focusing on several elements in its path to net zero. “We’ve already made progress in reducing methane emissions on our own system. … [We’re] doing more leak surveys, monitoring our pipelines using technology like drones and helicopters, and making sure that we’re not doing any blow downs while we’re doing line maintenance,” said Malik. “For our Scope 2 emissions, which is the energy we use in our facilities, we’re at 100% green energy, from the electric perspective, on all our facilities that are connected to the grid. This has been super helpful for our carbon dioxide emissions.”
As a result, the utility is already exceeding its goals. “The state of California gave us a goal to reduce our methane emissions by 25% by 2025 and 40% by 2030, versus a 2016 baseline,” said Malik. “As of 2022, we’re 37% below our baseline, so we’re almost at that 2030 goal in 2023.”
The utility also met its 2022 goal of 5% RNG integration in its system and is on track to hit its goal of 20% RNG in the system by 2030. RNG is also aiding SoCalGas in reaching its 2035 goal for a zero-emissions fleet: “Thirty-six percent of our over-the-road fleet has been converted to alternative fuels, including our RNG vehicles,” said Malik.
Utilities with robust emissions-reduction strategies in place are already gaining further insights as they explore new solutions and address the inevitable challenges.
“There’s a truism that, with projects like this, it’s going to take twice as long and cost twice as much as you expect,” Spire’s Popielski acknowledged. “I would say that’s pretty accurate. So, the first advice I’d offer is that everybody has to be very aware of the cost-benefit components. If you want to prudently manage costs for your ratepayers, within your regulatory environments, you really need to try to work collaboratively with those regulators to establish what you should do in your geography, based on solid cost-benefit analyses of all the components you propose.”
He offered a word of caution: “Gathering accurate, consistent data is going to be the hardest thing to accomplish when looking at emissions. Data integrity is critical, and there are a lot of points in the process when errors can creep in.”
As far as what Duke Energy has learned in the process so far, Weintraub said, “[We’ve learned that] technology can be a powerful tool. It continues to evolve, and it’s only going to get better from here.”
The other lesson is the value of partnerships. “We received a grant from the U.S. Department of Energy to expand our methane monitoring satellite work,” said Weintraub. “We have also worked with Accenture and Microsoft in this endeavor, because this system involves managing a lot of data. They, along with Satelytics, a satellite data analytics company, have been key partners.”
In addition, Duke is working with Williams to explore methane-emission detection at a compression station on Williams’ Transco pipeline, which supplies natural gas to Duke Energy. “We’re also going to be going downstream, and the DOE grant will allow us to evaluate the technology and leaks on some of our industrial customers’ sites,” added Weintraub. “Addressing methane leaks both upstream and downstream has become an essential step toward our 2050 net-zero goal.”
But partnerships alone don’t guarantee success. “It’s important that any partners you work with are willing to explore, through trial and error, the best way to go about solving the problem,” said Weintraub. “With partners like that, you can try, discover what does and doesn’t work, then get better.”
For SoCalGas’ Malik, an important part of the success of net-zero programs is being transparent and reporting progress to the public. “We’ve been open about our goals for 2025, 2030, 2035, and we actively report on those goals, whether we make them or we feel like we’re going to miss them,” he said. “Even if you have ambitious goals, you need to make sure your stakeholders are with you throughout the process.”
Finally, Malik suggested, there is real value in sharing your progress and strategies with other utilities on the same emissionsreduction journey. “SoCalGas is very open to sharing what we’re learning with all of our developer partners and other AGA members,” he said. “We all have our own service territory, so we’re not in direct competition. The more we can collaborate and learn from each other, the faster we can get this transition moving.”