Jemena and Origin Energy have inked an agreement to sell and purchase renewable gas produced at the Malabar Biomethane Demonstration Project.
Jemena’s Managing Director Frank Tudor, announced the agreement at this year’s Australian Domestic Gas Outlook Conference, saying it will allow biomethane to be blended into Jemena’s gas distribution network, which serves over 1.5 million gas users across Sydney and parts of regional NSW.
“We’ve received broad interest from a number of retailers when we initially approached the market with an offer to purchase biomethane, and we are thrilled to have agreed to sell the renewable gas to Origin,” Tudor said.
According to Tudor, the announcement demonstrates that renewable gases, such as biomethane, are commercially viable and that the market has a strong appetite for them as part of the future energy mix.
“Biomethane is a here and now technology which can help lower carbon emissions by displacing other gases. It is also compatible with existing gas appliances and infrastructure. Biomethane can also help establish a circular economy which repurposes human, agricultural, and other waste,” Tudor stated.
As the AEMO emphasises in its most recent Gas Statement of Opportunities, Tudor added that Jemena believes biomethane and other renewable gases will play an increasingly significant role in the energy transition, contributing to system diversity and optionality as traditional sources of gas supply decline.
Tudor said Jemena’s Malabar Biomethane Demonstration Project, a $16 million collaboration between the Australian Renewable Energy Agency (ARENA), Sydney Water, and Jemena, will supply renewable gas to Origin. Jemena and ARENA have both contributed to the project’s funding.
The project is set to start soon and is estimated to produce roughly 95 terajoules of gas per year. This volume is equal to the gas consumption of nearly 6,300 houses. Jemena expects that over the four-year trial duration of the demonstration project, production may be scaled up to create over 200 TJs of biomethane per year, equivalent to the usage of around 13,300 homes if used in the residential network.
The gas produced at the Malabar Biomethane Demonstration Project is expected to be the first renewable gas recognised as part of a renewable gas certification pilot created by GreenPower, a group accredited by the NSW Government.
According to ARENA’s bioenergy strategy, by 2030, the bioenergy sector may generate an additional $10 billion in GDP per year, create around 26,000 new employment, divert approximately 6% of waste from landfill, and cut emissions by approximately 9%.
Australia’s Bioenergy roadmap has identified approximately 2,600PJs of biomethane that might be used across Australia’s gas networks. Separately, Jemena has located roughly 30PJs of potential biomethane near its NSW gas distribution network, which, if developed, would be enough biomethane to supply Jemena’s 1.5 million residential customers’ gas demands.
