The potential for low-carbon renewable methane in heating, power, and transport in the Netherlands

This study presents the production potential for renewable methane in the Netherlands in 2050. The Netherlands is in the process of developing the domestic energy and gas infrastructure policies necessary to comply with both the recast Renewable Energy Directive (RED II) and the country’s Paris Agreement commitments. This study provides an independent estimate of the renewable methane production potential in the country and the cost of greenhouse gas (GHG) reductions through increased renewable methane deployment through 2050.

We find that the total renewable methane production potential in the Netherlands is relatively limited and would meet less than 5% of the Netherlands’ projected 2050 natural gas demand. At maximum production potential, renewable methane could displace existing fossil fuel consumption and generate between 10 and 15 million metric tonnes of CO2e reduction, depending on end-use. The analysis demonstrates that it is much more cost-effective to use the majority of renewable methane production potential for on-site electricity generation rather than injecting it into the natural gas grid. Because more than 80% of the Netherlands’ sustainably available renewable methane feedstocks come from livestock manure, the added cost of grid interconnections for distant farms would make grid injection cost-prohibitive without extremely high policy incentives.

Overall, renewable methane can only make a modest contribution to the Netherlands’ overall Paris Agreement ambitions and long-term plan to reduce reliance on natural gas.  Although incentives should be made available to renewable methane producers utilizing sustainably available feedstocks with good GHG performance, the Netherlands will largely have to wean itself off its reliance on gas in order to completely phase out natural gas consumption by 2050.