Presentation to the Joint Committee on Communications, Climate Action

and Environment

February 2018

Gas Networks IrelandMeeting Ireland’s targets under the 2020

Climate & Energy Package

Natural Gas and Ireland’s Economy

• Natural Gas plays a critical role in Ireland’s economy.

• Delivering 30% of Ireland’s primary energy demand and

16% of total final energy consumption.

• 52% of Ireland’s Electricity is generated from Natural Gas.

• Ireland’s Natural Gas Network supplies energy to more than

688,000 homes and businesses.

• 60% of Ireland’s Natural Gas supply is currently indigenous

from the Corrib gas field.

• There is significant potential for further diversity of supply

through the development of Renewable Gas and LNG.

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The Gas Network is Essential to Meet Climate Targets

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10

20

30

40

50

60

70

2016 2050 target [80%] 2050 target [95%]

Ireland has committed to reducing CO2 emissions

MT CO2 Agri Energy

By further

utilising the

current gas

network –

Ireland could

remove over

17.5 MT of

CO2 from its

emissions by

2050

At lowest cost to consumers

& exchequer

With the least disruption to

the end-users, while utilising

existing assets

While enhancing Ireland’s

security of supply

While providing significant

jobs to rural Ireland

All this can be achieved

using the gas network:

Gas Fired Power Generation is Key for Ireland

• Dependency on Natural Gas for electricity generation decreased from 2012 to 2015 as more Renewables were brought on.

• Dependency increased again in 2016 as wind output dropped and the East West Interconnector (EWIC) was on a

prolonged outage.

• It is clear that natural gas fired power generation is key to the Irish electricity system.

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51% 46% 45% 43%52%

15%17% 18% 24%

22%

19%16% 15%

18%17%

9%9% 10%

9%9%8% 8%

2012 2013 2014 2015 2016

Gas Wind Coal Peat Other Interconnectors

Natural Gas Supports Renewables

• Across the month (March 2016), wind powered generation contributed between 0.6% and 73.6% to the

power generation fuel mix. Gas fired generation contributed between 14.3% and 68.8% over the same

period i.e. gas fired generation provided the flexibility and stability to match the high level of intermittency of

wind.5

Switching to Natural Gas and Renewable Gas• GNI is converting an average of 3,500 domestic oil boilers to Natural Gas Boilers per year, reducing CO2 emissions by an

average of 22%.

• GNI is converting an average of 800GWh per year of industrial heat load from Coal, Oil and Heavy Fuel Oil to Natural Gas

reducing CO2 emissions by an Average of 40% - In 2017 this resulted in a reduction of 65,600t of CO2.

• All customers using Natural Gas will be able to switch to Renewable Gas in the future resulting in additional CO2 reduction.

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50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

2016 2017 2018 2019 2020

To

nn

es

of C

O2

Cumulative reduction in CO2

by Switching to Natural Gas

Domestic Gas Connections

Commercial Gas Connections

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Potential for CNG in Ireland

• Provide an alternative refuelling network across Ireland.

• Ability to refuel the national fleet of HGV’s and Buses with

Natural Gas or Renewable Gas.

• Meet the requirements of Irelands National Framework for

Alternative Fuels Infrastructure

• Deliver initial CO2 reduction of up to 25% in commercial

transport

• Deliver fuel cost reduction of up to 35% over Diesel.

• Facilitate the introduction of 100% carbon neutral Renewable

Gas to transport.

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CNG 10 Year Development

• Deliver a minimum network of 70 CNG stations across Ireland.

• Capacity for up to 5,000 HGV’s

• On Natural Gas this equates to removing 47,000 diesel cars

• On Renewable Gas this equates to removing 273,000 diesel cars

• Phased transition from Natural Gas to Renewable Gas.

• 14 stations by 2020

80

10

20

30

40

50

60

70

80

2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027

CNG Stations

Project “Causeway”

• A co-funded project under the EU Connecting Europe facility.

• Project will run 2016 - 2020

• Aim of the project is to deliver;

‒ Assessment of the impacts of CNG on the Gas Network.

‒ A network of 14 stations along the T-TEN transport routes,

‒ A renewable Gas injection facility

‒ Gas Vehicle Support Scheme

• Vehicles will have a range of up to 600km and will refuel in 4-5 mins.

• First station has been constructed in Dublin Port.

• Second station on M7 Motorway in planning.

• Pipeline of 30 stations.

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• Reduce the carbon footprint of the gas network through the

development of a Renewable Gas industry.

• A 100% carbon neutral transport fuel through CNG refuelling

stations.

• A central element to achieving emission reduction targets in

heat and power.

• A key tool to attract FDI

• Replace 80% Natural Gas on the network.

• Reduce Irelands dependency on import fuel by approximately

€300 million per annum by 2030.

Potential for Renewable Gas

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• A network of centralised Renewable Gas injection facilities

• Minimum capacity of 11TWh (20% of total gas demand)

• Renewable Gas Certification Scheme allowing national and

international trading of Renewable Gas

• A compressed gas transport network to facilitate farm-gate collection

of Renewable Gas

• Partnering with the Agri and Waste Management Sectors to develop

Renewable Gas production facilities.

• Transition CNG network to Renewable Gas

Renewable Gas 10 year Development

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Renewable Gas and CNG Projects

• Co-funded by the Connecting Europe Facility and Gas Networks Ireland.

• Renewable Gas Injection;

‒ Working with biogas producer Green Generation Ltd.

‒ Project will be completed in 2018.

‒ Regulatory & functional design “blueprint” for future projects.

‒ Capacity to inject up to 90GWh/annum

‒ This is equivalent to the energy used by approximately 200 Heavy Goods Vehicles

‒ Saving 25,000 t CO2 emissions

• First Private CNG Station

‒ Clean Ireland Recycling – Shannon

‒ Fleet of 25 trucks transitioning to CNG

‒ First CNG trucks in regular operating in 2017

‒ CO2 savings of 500 Tons per annum on Natural Gas and 2,900 Tons on Renewable Gas

• First Public CNG Station

‒ Constructed in Dublin Port

‒ Dedicated truck/bus refuelling depot

‒ Capacity to refuel up to 70 trucks/buses per day

‒ Commercial operation in March 2018.12

Renewable Gas Certification Scheme

• In development with national and international partners

• The certification scheme will be in compliance with EU

and national regulations

• Internationally recognised by Carbon Disclosure Protocol

/ World Resources Institute International standards.

• Principles and methodology for Greenhouse Gas

accounting

• Independent auditing of individual GHG mitigation values

• A registry system for Renewable Gas Certificates

• Operational in Q4 2018

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Carbon Capture & Storage (CCS) What can it do for Ireland?

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Emission savings from all wind turbines in Ireland

Removing 1.1 million cars from Irish roads

Emissions from 750,000 oil heated homes

Over 100,000 full flights between Dublin & Brussels

Emissions from 925,000 dairy cows

CCS project in Cork

• Essential for Ireland and globally

• Least-cost solution

• EU Funding available

Needs strong Government support

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UCC – Least-Cost Model (2015)

• UCC Least-Cost Model Key Findings - The position in 2050:

• The bulk of energy use (71%) is non-electrical energy used for transport and heat.

• Electricity accounts for 29% of end use. This clearly suggests significant electrification but equally that most of

the energy system is not electrified.

• Natural gas has a significant role. Most of the gas usage is in electricity generation in power plants that have

carbon capture and storage (CCS) technology.

• There are constraints on how much electrical energy can be provided by non-synchronous renewable

electricity. Renewable energy provides 51% of electricity.

• Renewable energy accounts for 55% of energy use, comprising indigenous biogas being used in freight

transport, solid biomass for heating in industry and liquid biofuels for freight transport.

• Renewable energy accounts for 63% of thermal energy, dominated by solid biomass but also with biogas for

residential heating (via the gas network).

• Transport energy, with the 2050 car fleet dominated by electric vehicles and liquid biofuels and biogas

providing the bulk of the remaining energy needs (i.e. for freight, public transport, etc.).