146. Reducing Carbon Intensity with Renewable Propane
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Most propane used in the U.S. today is produced as a byproduct of natural gas processing and crude oil refining, which are not considered “green” technologies. However, renewable propane availability is growing. Renewable propane, like its conventional brother, is commonly made as a byproduct of other fuel production, in its case, often renewable diesel and sustainable aviation fuels (SAFs). Renewable diesel and SAF are primarily produced from plant and vegetable oils, animal fats, and used cooking oil. Renewable propane has the exact same features as conventional propane, which includes excellent reliability, portability, and power, as well as reduced carbon emissions on a per-unit-of-energy basis compared to many other fossil fuels. While the scale of renewable propane production is fairly small at present, most experts agree that it has the potential to ramp up quickly. “Looking at what we’ve done for the past five years is we were shipping about 40 million gallons [of renewable propane]. By the end of this year, we’re going to be close to 100 million gallons, and by the end of 2024, we should be close to 200 million gallons. So, the scalability is coming up—there’s more refineries coming on,” Jim Bunsey, director of commercial business development with the Propane Education & Research Council (PERC), said as a guest on The POWER Podcast. One way to judge the environmental impact of a fuel is through its carbon intensity (CI) score. The concept was brought to many peoples’ attention in 2009, when the California Air Resources Board approved the state’s Low Carbon Fuel Standard (LCFS) regulation. The LCFS set annual CI standards, or benchmarks, which reduce over time, for gasoline, diesel, and the fuels that replace them. CI is expressed in grams of carbon dioxide equivalent per megajoule of energy (gCO2e/MJ) provided by a fuel. CI takes into account the greenhouse gas (GHG) emissions associated with all of the steps of producing, transporting, and consuming a fuel—also known as the “complete lifecycle” of the fuel. According to Bunsey, conventional propane has a CI of about 79, but renewable propane is much lower. “We can have renewable propane having a carbon intensity of seven or up to 20.5,” he said. “There’s a range—it depends on the feedstock that’s available.” Notably, both conventional and renewable propane compare quite favorably to the U.S. power grid’s average CI, which is about 130, according to Bunsey. While California has been a leader nationally in the push for GHG reductions, other jurisdictions are following its example. The Pacific Coast Collaborative, a regional agreement between California, Oregon, Washington, and British Columbia is one example. Over time, collaborative member LCFS programs are expected to build an integrated West Coast market for low‐carbon fuels that will create greater market pull, increased confidence for investors of low-carbon alternative fuels, and synergistic implementation and enforcement programs. Other regions of Canada and Brazil are also using California as a model to develop LCFS‐like performance standards for transportation fuels. Suppliers are also finding interest for renewable propane in the northeastern U.S. The first delivery of renewable propane in Massachusetts was received with a ceremony at the NGL Supply Wholesale Springfield terminal in West Springfield on Sept. 12. “The cost is just very slightly more than traditional propane today, but we anticipate as more of it is produced that that cost is going to come down. And if you think about the added benefit that you get by knowing you’re helping the climate and helping the planet by using renewables, I think a lot of people are willing to spend just a little bit more to get that,” Leslie Anderson, president and CEO of Propane Gas Association of New England, told WWLP-22News, a western Massachusetts multimedia company.