Decarbonisation of Methane Use in Europe: A Crucial Step Toward Climate Neutrality
As Europe accelerates its ambitious transition toward climate neutrality, the role of methane in its energy landscape is undergoing a profound transformation. Methane, the core component of natural gas, has historically formed a critical part of the continent’s energy mix, providing around one-fifth of the European Union’s total energy supply. However, its inherently fossil-based nature and high global warming potential—28 times more potent than CO2 over a 100-year timeframe—position it as a significant emitter that must be addressed if the EU is to meet its decarbonisation goals.
With the EU targeting a reduction of greenhouse gas emissions by 55% by 2030 and achieving net-zero emissions by 2050, the decarbonisation of methane use represents both a challenge and an opportunity. The groundwork for this transition involves a combination of reducing reliance on fossil-based methane, developing green alternatives such as biomethane and synthetic methane, and managing infrastructural realignments. These efforts are underpinned by evolving policy frameworks, including the EU Methane Strategy and the revisions of the Gas Directive and Gas Regulation, as well as innovations in green energy technologies.
The Current Landscape of Methane Use in Europe
Methane’s pervasive role in Europe’s energy system is deeply entrenched across multiple sectors. It is a critical input in industry, particularly in generating process heat and serving as a feedstock for various chemical processes. In the power sector, methane has been instrumental in providing baseload and backup flexibility for intermittent renewable energy sources. Additionally, it is widely used in space heating for residential and commercial establishments and plays a minor but growing role in transportation, particularly in LNG-fueled ships and trucks.
Despite its versatility, nearly 80% of the EU’s natural gas supply is imported, predominantly from Russia, Norway, and Algeria. Domestic production has dwindled due to geological challenges, policy restrictions on fracking, and declining reserves. In 2019, natural gas accounted for approximately 4,800 TWh of input into the EU energy system, which reflects its criticality. However, this reliance on fossil methane presents a significant carbon footprint, both through combustion-related CO2 emissions and fugitive methane emissions during extraction, processing, and transportation.
The EU has already made strides in reducing its dependence on natural gas through the deployment of renewable technologies and the diversification of its energy mix. However, achieving climate neutrality by 2050 necessitates a complete phase-out of fossil methane. This calls for a nuanced strategy involving the substitution of natural gas with green gases like biomethane and synthetic methane, alongside electricity and hydrogen in various demand sectors.
Green Alternatives: Biomethane and Synthetic Methane
Decarbonising methane use hinges on the development and scaling of green gas technologies. Biomethane, a renewable form of methane produced through anaerobic digestion of organic waste or gasification of biomass, offers an immediate and scalable alternative. With a methane content exceeding 90%, biomethane can seamlessly integrate into existing natural gas infrastructure, making it a viable replacement without extensive modifications.
Europe is already the largest producer of biogas globally, generating around 160 TWh in 2019, with Germany leading production. However, biomethane currently constitutes only about 3% of the EU’s gas supply. Scaling this up will require significant investment and diversification of feedstocks, including agricultural residues, municipal solid waste, and wastewater. Though production costs, averaging €55/MWh, remain higher than those of natural gas, declining costs through technological advancements and economies of scale are expected to make biomethane more competitive.
Synthetic methane, or power-to-gas methane, represents another promising pathway. Produced by combining hydrogen from renewable electrolysis with captured CO2, synthetic methane is entirely carbon-neutral when renewable electricity powers its production. However, its higher production costs and energy-intensive process currently limit its large-scale deployment. According to estimates, synthetic methane production costs range between 5.9 and 37 €ct/kWh, depending on production technologies and plant sizes.
Role of Infrastructure and Policy in the Transition
The natural gas sector in Europe relies on an intricate and asset-specific infrastructure, including pipelines, underground storage facilities, and 27 regasification terminals for liquefied natural gas (LNG). This infrastructure, while extensive, presents a double-edged sword in the decarbonisation journey. On the one hand, existing pipelines and storage facilities can be repurposed for green methane, minimizing asset stranding. On the other hand, significant overcapacity in certain regions and underutilization of cross-border points—averaging 30% utilization rates—highlight inefficiencies that must be addressed.
Policy will play a pivotal role in ensuring an orderly transition. The EU’s “Hydrogen and Gas Markets Decarbonisation Package” aims to revise existing regulatory frameworks to accommodate the shift from fossil methane to green gases and hydrogen. Additionally, the EU Methane Strategy seeks to mitigate fugitive methane emissions from imports, requiring certified reporting and the potential pricing of methane content through border taxes. These measures will not only reduce emissions but also incentivize investments in low-leakage and renewable gas production.
Beyond Fossil Methane: Electrification and Hydrogen
While green methane offers a direct substitution for natural gas, electrification and hydrogen are emerging as the cornerstones of Europe’s long-term decarbonisation strategy. Electrification, powered by renewable energy, is particularly well-suited for applications like space heating and low-temperature industrial processes. Heat pumps, electric boilers, and advanced furnaces are already replacing fossil gas systems in various sectors, demonstrating efficiencies and cost-effectiveness.
Hydrogen, especially green hydrogen produced through renewable electrolysis, offers a versatile and scalable alternative for high-temperature industrial processes and energy storage. Unlike methane, hydrogen can provide a zero-carbon energy source without requiring CO2 capture. The EU aims to deploy 40 GW of hydrogen electrolyzers by 2030 under its Hydrogen Strategy, making it a critical component of the decarbonisation puzzle.
Challenges and Opportunities
While the roadmap for methane decarbonisation is clear, significant challenges remain. Scaling up biomethane and synthetic methane production requires substantial investment and policy support to offset higher costs. Public acceptance of technologies like carbon capture and storage (CCS), essential for synthetic methane production, also poses hurdles.
However, the economic and environmental benefits of transitioning away from fossil methane are immense. The EU’s decarbonisation efforts are expected to create 600,000 new jobs by 2030, particularly in renewable energy, infrastructure development, and the green economy. Reducing methane-related emissions will also yield public health benefits by improving air quality and mitigating climate impacts.
Conclusion: A Balanced and Inclusive Transition
The decarbonisation of methane use in Europe is not merely a technical necessity; it is a moral and economic imperative in the fight against climate change. By leveraging a mix of green gases, electrification, and hydrogen, Europe can achieve its ambitious climate targets while fostering innovation and economic resilience.
Policy frameworks, such as the EU Methane Strategy and the Hydrogen and Gas Markets Decarbonisation Package, provide the necessary scaffolding for this transition. However, the path forward will require unprecedented collaboration between governments, industries, and consumers, as well as sustained investment in research, infrastructure, and workforce development.
In the coming decades, Europe has the opportunity to lead the global energy transition by demonstrating that decarbonisation is not only achievable but also serves as a catalyst for economic growth and environmental stewardship. Methane, once a symbol of fossil dependence, can become a vital component of a carbon-neutral future, with the right mix of innovation, policy, and ambition.
