T&E: Carbon footprint of European gas imports underestimated by almost 30%

Despite the efforts to promote liquefied natural gas (LNG) as the go-to clean alternative, new evidence on upstream emission suggests that Europe’s gas mix is much dirtier than the European Union’s (EU) officials had initially thought, Transport and Environment (T&E) shared.

According to a study titled “How much does LNG emit before it burns on a ship?”, done by Energy and Environmental Research Associates on behalf of T&E, Europe’s LNG imports are 30% higher in pollution concentration than was previously assumed by the EU in its green shipping law.

As explained, LNG has often been presented as a ‘reliable and clean’ option by oil and gas companies, and, certainly, much more sustainable than heavy fuel oil, which is one of the most polluting fuels on earth.

According to the organization, there are almost 1,200 LNG-powered vessels globally at this time, with close to 1,000 on shipping companies’ order books. Moreover, T&E has previously projected that a quarter of EU shipping could run on LNG in 2030.

However, while LNG combustion is believed to produce fewer local air pollutants and less carbon dioxide (CO2) than traditional marine fuels, unburned methane that slithers out from LNG engines—commonly used in passenger and cruise ships—undermines its potential climate benefits.

While the issue of uncombusted methane is increasingly acknowledged as a concern by policymakers, T&E’s study has spotlighted that the upstream greenhouse gas (GHG) emissions generated during the extraction, processing, liquefaction, and transportation of LNG largely remain overlooked.

Namely, because of the energy policy changes sparked by the Ukraine war, the EU increasingly relied on EU imports to meet its natural gas demands. As disclosed, the US, Qatar, Russia, Algeria, Nigeria, Norway, Trinidad and Tobago as well as the UK together comprise 90% of the EU’s LNG imports, each with varying upstream emission profiles.

That said, the organization’s new analysis found that LNG imported from countries like the US, Qatar, Russia, and Algeria was “nearly as bad as the fuel it replaces”. Moreover, even when the LNG came from less polluting upstream countries like Norway and the UK, emissions reductions are believed to have been limited.

Upstream emissions from the extraction, production, and transport of LNG can vary depending on the origin of the fuel and the way it was manufactured, the T&E further highlighted.

Within this context, Europe’s green shipping law FuelEU Maritime—which calculates fuel emissions on a life-cycle basis, taking into account both upstream and onboard emissions—fails to account for the differences, T&E argued. Instead, it uses a ‘standardized’ calculation of 18.5gCO₂e/MJ.

Though this is ‘tempting’ for shipping companies to meet their sustainability goals, T&E’s analysis suggested that LNG emissions from the fuel’s import to Europe were, in fact, as high as 24.4gCO₂e/MJ. What this means is that a single large container ship running on LNG would emit an extra 2,731 tonnes of carbon dioxide equivalent every year, the organization emphasized.

It is this discrepancy that the report said has made ‘clear’ the 30% unaccounted upstream CO₂e emissions from LNG, considered to be equivalent to 223 container ship voyages between the US and the Netherlands.

“Fossil gas will never be sustainable and is even dirtier than previously thought. Extracting, transporting and burning methane is a leaky business. This costly pursuit is leading major shipping companies to waste billions on a solution that won’t bring them any closer to their zero-emission goals,” Inesa Ulichina, shipping officer at T&E, accentuated.

Instead, they should focus on investing in green e-fuels production. The EU and the IMO can stop incentivizing fossil gas by fully taking into account its full lifecycle emissions – from the ground to the sea,” she added.

On a wider scale, beyond the European continent, the International Maritime Organization (IMO) has been developing emission factors for shipping fuels, such as the revised 2023 GHG strategy, adopted in June of that year at the Marine Environment Protection Committee (MEPC 80) climate summit in London.

The strategy called for the uptake of zero or near-zero GHG emission technologies, fuels, or energy sources to represent at least 5% (striving for 10%) of the energy used by global shipping by 2023. By extension, the IMO urged the maritime industry to reach net-zero GHG emissions by or around 2050.

That said, Transport & Environment has called for ‘country-specific’ and ‘up-to-date’ emissions reporting, starting with fuels such as LNG, citing this as “essential in avoiding misleading standards that obscure LNG’s true climate impact”.

As understood, to ‘effectively’ address emissions from LNG and ensure shipping’s alignment with
decarbonization goals, T&E has proposed the following policy actions:

• Revise EU emission standards to ‘accurately’ reflect upstream methane emissions. Given the fact that the new EU Methane Regulation requires ‘detailed’ reporting of fossil gas’ carbon footprint, the well-to-tank methane emission factor in the FuelEU Maritime is, thus, cited as being ‘in need of proper adjustment’;
• Establish ‘realistic’ upstream LNG emissions values at the IMO, by basing them on ‘trustworthy and recent’ scientific data;
• Standardize fuels’ emissions reporting at the IMO, with obligatory regular and granular reporting for each stage of the fuels’ value chain;
• Assure that the IMO Global Fuel Standard (GFS) takes into account shipping emissions on a well-to-wake basis.

Should the above be followed through, T&E’s report suggests that the maritime industry can ‘readjust’ its course toward its net zero by 2050 goals.