Meeting the challenge of meeting Australia’s commitment to Net Zero, the Australian energy sector will be required to accelerate its transformation to fully decarbonise by 2050.

A large percentage of the Australian commercial and industrial sector heavily rely on natural gas or LPG for thermal energy, as well as onsite power for many of Optimal’s microturbine customers.

Recognising the need to provide Australian energy users with a net zero solution that allows them to transition their behind the meter thermal and electrical energy to renewables, Optimal Group have established a new company focused on delivering this alternative, Optimal Renewable Gas.

Natural gas and LPG used for high quality, low emission heat for industry, is challenging to replace

The challenge for industry

For many C&I energy consumers, thermal energy (e.g., steam and hot water) can account for up to 70% of their total energy needs, making fossil fuel gas very challenging to substitute.

Electrification of heat (i.e., generating heat from electricity), is constrained in many areas due to insufficient network capacity required to deliver the additional power needed. Other solutions such as biomass boilers are highly dependent on the availability of affordable feedstock and an individual facilities ability to manage the storage and processing of the biomass, among other factors.  

New technologies such as green hydrogen (using renewable electricity to produce hydrogen from water), offers a promising pathway for the decarbonisation of heat. Currently, there are several pilot projects underway in Australia to blend renewable hydrogen in the gas network of up to 10%, and aspirations to convert to 100% hydrogen over time.

Biomethane - the other green gas

Natural gas found in the existing gas networks is primarily comprised of methane (CH4). Optimal Renewable Gas will develop 10 grid scale biomethane plants, distributed across the Australian East Coast, to produce renewable bio-methane from organic waste.

While the combustion of bio-methane to make power or heat emits CO2, the organic waste feedstock used to create the gas (from food & agricultural wastes) absorbs CO2 from the atmosphere while growing. As such, it absorbs the same amount of carbon from the atmosphere as released, meaning the fuel created becomes net zero emission in the carbon cycle.

The production of biomethane is a well understood and mature process, where organic waste is broken down by bacteria (methanogens) in the absence of oxygen inside an anaerobic digester. The bacteria convert this waste into both a biogas and fertiliser. The biogas is mainly a mix of methane and carbon dioxide (CO2).

In a bio-methane plant, the biogas then undergoes an upgrade process where the CO2 and other impurities are removed, leaving a high purity biomethane stream. This biomethane will be either compressed and injected into the gas network, or liquified as bio-LNG (Liquified Natural Gas) for local Australian LNG customers. Once injected into the gas network, Optimal Renewable Gas customers can procure their bio-methane through their existing gas network connection. Where the gas is available as LNG, customers will be able to elect to have their LNG supplied as renewable gas.

Australian industries such as beverage manufactures, greenhouses and others also are consumers of industrial CO2, which is usually recovered from fossil fuel sources. Optimal Renewable Gas will make this CO2 available as a net zero alternative, as well as the high-quality fertilisers produced from the renewable gas production facilities.

Optimal has recently announced an MOU with BOC and its subsidiary, Elgas, to investigate and jointly develop Australia’s first bio-LNG facility in Westbury, Tasmania. This facility will produce up to 2.4 terajoules of bio-methane each day to supply the existing BOC/Elgas LNG facility, which delivers gas to Tasmanian industry not connected to the natural gas grid. Comparatively, this facility will produce the equivalent green gas energy as would a 35 MW hydrogen electrolyser per day running on 100% renewable power.

Once completed, this will be Australia’s first bio-LNG facility. 

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