National Gas set for cash injection to slash methane emissions

National Gas Transmission (NGT) is set to receive an additional £17.35 million to help manage and reduce methane emissions from the National Transmission System (NTS).

The additional funding will support projects designed to capture methane emissions arising from pipeline inspection works and compressor station depressurisations as well as reduce methane emissions from compressor venting.

NGT had requested an additional £29.91 million to fund several small net zero related projects under the RIIO-2 Net Zero Pre-Construction and Small Projects re-opener mechanism.

However, in its minded-to position Ofgem has ruled that the amount of funding that will be made available will be some £12.56 million less than NGT had asked for.

Most of the reduction relates to detection and analytics programmes (monitoring), for which NGT asked for £13.51 million but Ofgem has only granted £1.3 million.

Ofgem said that this was because NGT’s assumption about the number of potential leaks was based on “speculation” and therefore it doesn’t “agree that this investment will bring significant benefits to consumers”.

Ofgem’s minded-to decision adds: “As a financial regulator one of Ofgem’s roles is to ensure that consumers are being charged only for efficient costs and where it has the greatest impact. […] Considering the cost-of-living crisis and specifically the cost of energy, we need to ensure that consumers’ money will be used efficiently and will bring the most environmental benefit.”

Full breakdown of funding:

The projects proposed by NGT have a common overall objective to reduce methane emissions from the NTS.

In 2021, methane accounted for 13% of all UK green house gas emissions. Methane emissions from the NTS was equated to a total of 4.735kt (118.38kt CO2e).

The projects proposed by NGT fall into three themes and aim to reduce up to 15% of methane emissions from operating the NTS in RIIO-2.

The themes are summarised by Ofgem as:

• Mobile Recompression (MR) – Additional mobile pipeline recompression capability and new mobile recompression units to capture methane emissions arising from pipeline inspection works and compressor station depressurisations.
• Compressor Machinery Train (CMT) – Trials of combined gas recompression and zero loss compressor seal technology to reduce methane emissions from compressor venting which is the largest contributor to whole NTS methane emissions.
• Detection and Analytics (D&A) – An expansion of NGT’s periodic fugitive monitoring programme in scope and frequency, and an implementation of new continuous fugitive monitoring systems at selected above ground installations.

The regulator is now consulting on its minded-to position, with relevant parties given until 8 November to respond.