EU proposal threatens renewable LNG supply – Eurogas
European trade association Eurogas has warned that proposed changes to EU renewable fuel sustainability rules risk stifling the supply of bio-LNG and e-LNG to the maritime sector.
IMAGE: Cosco Shipping’s LNG dual-fuel tanker Xing Sheng Yuan bunkering bio-LNG. Cosco Shipping
Eurogas and 44 other organizations – including CMA CGM, SEA LNG, Axpo, Enagas, Shell Energy and more – have claimed in a joint statement that changes under consideration to the European Union’s (EU) sustainability rules will devalue the “liquefaction by equivalence” system used to supply renewable or bio-LNG via Europe’s existing gas infrastructure.
The changes in Commission Implementing Regulation 2022/996 will increase FuelEU Maritime compliance cost and dampen investment in renewable marine fuels like bio-LNG, the coalition led by Eurogas said.
Liquefaction by equivalence allows biomethane and e-methane to be supplied to ships as bio-LNG by leveraging Europe’s existing gas grid. Through a certified accounting system, renewable gas produced inland can be credited to vessels at any European port.
However, the changes considered for the EU’s sustainability certification rules will impact how emissions are allocated within renewable supply chains, allocating fossil-based LNG supply chain emissions to bio-LNG and e-LNG supplied through the mass-balance system, the coalition argued.
“This would make the system unviable, reducing renewable fuels availability for shipping, increasing compliance costs for ship operators and weakening investment in biomethane and e-methane production across Europe,” Eurogas said.
The changes will also discourage shipowners from investing in biomethane and e-methane production, the coalition said, adding it “could disrupt this system by altering emissions allocation, potentially reducing renewable fuel availability for shipping.”
“Overall, this would degrade the EU ambitions when it comes to renewables uptake and close one of the most important levers for the necessary biomethane/e-methane growth in Europe,” according to the joint statement.
By Aparupa Mazumder
Please get in touch with comments or additional info to news@engine.online
