Using RE to Power LNG Plants Could Reduce Emissions by 8% in APAC: WoodMac

Using RE to Power LNG Plants Could Reduce Emissions by 8% in APAC: WoodMac

Using RE to power LNG plants in Asia Pacific (APAC) could reduce emissions by about 8 percent, according to an analysis by Wood Mackenzie.

Using renewable energy (RE) to power liquefied natural gas (LNG) plants in Asia Pacific (APAC) could reduce emissions by about 8 percent, according to an analysis by Wood Mackenzie. Asia Pacific produces over a third of the world’s LNG, but also generates over 50 million tonnes of carbon dioxide equivalent (MtCO2e) of emissions during liquefaction. Australian LNG projects account for over half or 29 MtCO2e of liquefaction emissions from LNG projects in the region.

Many of Asia Pacific’s LNG facilities are located in remote areas, far from the power grid. As a result, feed-gas is used to generate electricity to run the plant and fuel the liquefaction process. Typically, 8 percent to 12 percent of feed-gas is consumed at the plant to run these processes. Older, more inefficient plants, as well as nascent floating LNG (FLNG) vessels operate with far higher losses.

“Three main decarbonisation levers could help reduce emissions at LNG plants, namely operational efficiency, design changes, and the use of renewable energy, which could be sourced from the grid or generated onsite,” said Jamie Taylor, Senior Analyst at Wood Mackenzie.

Feed-gas is used to fuel gas turbines to generate electricity to power the plant. Replacing these gas turbines with electricity could greatly reduce emissions, assuming the grid power is less carbon intensive. The other option is to install on-site renewable power, in particular solar.

“If a solar plant or a hybrid solar plus battery storage plant is installed at the LNG facility, back-up generators could be switched off and renewable electricity could be used to meet the power load. As costs continue to decline and technology improves, renewable plus battery storage could become an alternative in the future, especially for new LNG plants.

“We are already seeing Australian LNG plant operators examining ways to reduce carbon emissions throughout the value chain. Initiatives are underway at the upstream assets supplying the North West Shelf and QCLNG, and Darwin LNG has installed a battery that reduces the need to run one of the gas turbines.

“Our analysis shows that installing renewable energy generation could reduce emissions at Asia Pacific’s LNG plants by 8 percent in 2020 alone,” said Taylor.

The biggest driver for decarbonisation is the potential for a carbon tax or tighter regulations in both exporting and importing countries. This would significantly impact the already strained project economics post-oil price crash.

Taylor adds that “a carbon tax is likely to be the biggest driver for LNG projects to switch to renewable energy at the plant or deploy carbon capture and storage to reduce emissions from upstream gas or both.

“Using less feed-gas as a fuel would result in more gas being available to supply either the domestic market or be converted into LNG for exports. Rather than increasing annual LNG output, which would only be possible by debottlenecking the plant, this ‘saved’ gas would be used to extend the plateau LNG production level by a few years. Revenues associated with the resulting extended plateau could reach into several billion dollars longer-term.

“In APLNG for example, installing 60 megawatts of solar in 2020 at a cost of USD 60 million increases the remaining value of the project by USD 62 million. “This is due to the additional revenues generated from selling the ‘saved’ feed-gas. The relative benefits of installing solar are increased further when a carbon tax is considered.”

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Ayush Verma

Ayush is a staff writer at and writes on renewable energy with a special focus on solar and wind. Prior to this, as an engineering graduate trying to find his niche in the energy journalism segment, he worked as a correspondent for