Pursuant to Article L. 421-7-1 of the Energy Code (Code de l’Énergie), operators of underground natural gas storage facilities must submit annual investment programs to the Energy Regulation Commission (Commission de Régulation de l’Énergie) for approval. This aims to ensure investments are in line with energy security objectives, a proper development of storage facilities, a transparent and non-discriminatory access for all users and the lowest possible costs for users. Investments cover new facilities, regional works, renovation plans, integrity and security improvements as well as methane emissions reduction programs.
Regulated entity Storengy sent its 2022 investment program on October 2021 for approval. This included a program to reduce its methane emissions by 25% by 2025, targeting the operator's main emission sources, reportedly: 45% from operational emissions (35% vented from compressor systems); 35% from maintenance activities; 20% from fugitive emissions (5% from accidental leaks).
The methane emissions reduction program entails the following three elements.
· Detection and reporting: developing a system for measuring emissions, including metering equipment (€1.4 million for 2022-2025, €0.2 million in 2022).
· Reduction of venting: use of mobile flares or gas recovery systems; potential implementation of a double valve system to limit vented volumes from equipment subject to regular maintenance (€7.3 million for 2022-2025, €0.6 million in 2022).
· Reduction of emissions from compressors: replacement of used seals and upgrade of sealing systems (€3.5 million for 2022-2025, €1.2 million in 2022).
The Energy Regulation Commission approved the investment in the methane emissions reduction program submitted by Storengy for a total budget of €2.0 million in 2022. The Commission notes these emissions do not fall within the scope of the EU Emissions Trading Scheme (ETS). Furthermore, in line with previous experience with similar projects presented by RTE and GRTgaz, this assessment is based on the cost of emissions avoided with regard to the shadow value of CO2, estimated at €250/t.