Biomethane Purchase Agreements
Biomethane, a renewable natural gas produced from organic materials, offers numerous advantages for corporations aiming to reduce their emissions. In Europe, this market is experiencing significant growth driven by favourable policies, environmental benefits, and the rising demand for renewable energy.
By opting for biomethane, companies not only align with global decarbonisation goals but also gain a competitive edge through enhanced sustainability and economic benefits. As such, implementing biomethane purchase agreements (BPAs) — also known as gas purchase agreements (GPAs) — enables businesses to significantly reduce their carbon footprints and associated scope 1 emissions by substituting fossil fuel-based natural gas.
Watch our video, part 1, to learn about the key benefits of BPAs and whether they are a suitable choice for accelerating your organisation’s sustainability efforts.
Prefer this content as an article? Read on below.
Biomethane, also known as upgraded biogas, is a renewable solution for scope 1, hard to abate greenhouse gas emissions, particularly in temperature processes and manufacturing.
In Europe, many large users of natural gas, such as food and beverage, agricultural, and chemical companies, are embracing biomethane as a sustainable alternative solution to electrification, seamlessly integrating it into their production equipment lifecycle strategies.
Why is biomethane getting more traction?
Organic waste from manure to agricultural residues and food scraps are feedstocks that hold the key to unlocking biomethane’s potential. For companies equipped with biological waste streams, biomethane production becomes not just an option, but a strategic advantage.
Similar to an organisation using power purchase agreements, PPAs, to procure large amounts of renewable electricity, more companies are signing biomethane purchase agreements (BPAs), also referred to as gas purchase agreements (GPAs).
A BPA is a long-term contract between a producer of this energy source, known as a seller, and the corporate offtaker, known as a buyer, to secure a supply of biomethane.
Let’s look at some of the benefits. BPAs allow for:
- The selection of specific biomethane production facilities aligned with sustainability goals
- Reduction of emissions and growth of new clean energy projects
- Fixed price contract structures, which can help mitigate volatility, in natural gas and biomethane certificate prices
So, whether you are a corporate giant or an emerging innovator, biomethane holds the key to a sustainable future, capturing the attention of forward-thinking companies across the EU.
In our next episode, we will delve deeper into understanding the European green gas market. Stay tuned.
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