Utilities are increasingly embracing carbon offset programs. These programs allow customers to pay extra to substitute a lower-carbon energy source, such as renewable natural gas (RNG), for regular natural gas.
Piedmont’s GreenEdge Voluntary Carbon-Reduction Program
Piedmont Natural Gas (Piedmont), a subsidiary of Duke Energy, is offering its residential and commercial customers in North Carolina the ability to reduce the impact of their own natural gas usage by participating in GreenEdge. GreenEdge is a voluntary program allowing customers to purchase green “blocks” from Piedmont and then claim the associated environmental benefits. “Our customers have shown a real interest in having access to tools and programs they can use to pursue their own carbon-reducing goals,” said Sasha Weintraub, president of Piedmont Natural Gas. “We’ve designed the GreenEdge program based on this feedback, and we consider it an important part of our own clean energy transformation.”
Each US$3 block represents the environmental attributes of RNG and carbon offsets and is equivalent to 12.5 therms of natural gas usage. Just one block is equal to 25% of the average household’s monthly natural gas usage, meaning customers who purchase four blocks could claim associated environmental benefits for approximately 100% of their monthly household natural gas usage.
Piedmont defines a carbon offset as “a reduction in greenhouse gas emissions created when one metric ton of carbon dioxide emissions, or other greenhouse gas equivalent, is captured, avoided, or destroyed to compensate for an equivalent emission made elsewhere.” It defines an environmental attribute as “an aspect, claim, characteristic, or benefit associated with the generation of a quantity of natural gas by a renewable source that is capable of being measured, verified, or calculated.”
When a customer purchases a block, Piedmont will add the associated charges to that customer’s bill. Piedmont said there is no limit on how many blocks a customer can purchase. Participating customers will receive an annual report highlighting their contributions and their overall effect on GreenEdge, which is a self-funding program. Piedmont received approval for GreenEdge from the North Carolina Utilities Commission in March 2022.
Black Hills’ Carbon Offset Program
Black Hills Corporation (Black Hills) announced that its Colorado natural gas utility subsidiary, Black Hills Energy, submitted a proposal to the Colorado Public Utilities Commission seeking approval to offer a voluntary RNG and carbon offset program for residential and business customers. The program would allow participants to offset 100% or more of the emissions associated with their own natural gas usage.
“We believe natural gas will continue to play a critical role in a clean energy future,” said Linn Evans, president and CEO of Black Hills Corp. “While thousands of customers and communities rely on natural gas each day for highly efficient home and space heating, water heating, and cooking, our customers are increasingly looking to us for sustainable and cost-effective options to help them reduce the carbon footprint associated with their natural gas usage.”
“Our Colorado natural gas customers have told us they are interested in sustainable energy and we’re listening,” said Evans. “We’ve designed this voluntary RNG and carbon offset program with their direct feedback in mind, cultivated over the past two years through customer surveys which indicated that more than half would be ‘somewhat’ or ‘very’ interested in a program of this nature.”
As proposed, participants in the voluntary program would be able to purchase fixed price blocks for US$5 each. Although Black Hills’ blocks are more than Piedmont’s, Black Hills said that one block would be the equivalent of 20.5 therms of natural gas, which amounts to approximately 25% of the average Colorado residential customer’s monthly usage. Therefore, Black Hills and Piedmont’s therms per block so to speak are practically the same.
Black Hills said that customers could purchase enough blocks to offset more than 100% of the emissions associated with their natural gas usage. The offset would be achieved through a combination of carbon offset credits and renewable natural gas attributes. The company designed its voluntary RNG and carbon offset program as a comprehensive four-year pilot program starting in 2023 and running through 2026, pending Colorado PUC approval.
“Over the course of the pilot program, we will closely monitor a variety of performance factors to better understand how we can shape the program to meet the expectations of our customers,” continued Evans. “As customer interest and enrollments grow, we will study the potential for growth in the carbon offset market and in renewable natural gas development across the communities we serve.”
The company will submit the voluntary RNG and carbon offset program to state regulators in Kansas and Nebraska later this summer with filings in Arkansas, Iowa, and Wyoming expected by 2023.