CenterPoint Energy files for RNG program in Minnesota

CenterPoint Energy filed a proposal Aug. 23 with the Minnesota Public Utilities Commission seeking approval to introduce a renewable natural gas green tariff pilot program to its Minnesota customers. If approved, CenterPoint Energy customers would be able to enroll in the program as early as spring 2019. CenterPoint Energy is one of the first natural gas providers in the U.S. to offer renewable natural gas (RNG) to customers.

The proposed program offers CenterPoint Energy customers in Minnesota the option to purchase RNG through their monthly bill. RNG is created by cleaning and refining methane produced from landfills, agriculture and waste water. If approved, the initial pilot program would be in place for five years, after which time CenterPoint Energy could request to continue, modify, or discontinue the program.

RNG is chemically nearly identical to conventional natural gas, but is sourced differently. Conventional natural gas is a fossil fuel obtained by drilling into underground rock formations. RNG is made of biogenic methane produced when organic waste breaks down in the absence of oxygen. Common sources include landfills, wastewater treatment plants and anaerobic digesters on farms or at food processing plants. Once processed, this biofuel can be injected directly into natural gas pipelines and used as a clean and reliable energy source for homes and businesses.

"In many cases, the methane emitted from these waste sources is not put to any useful purpose. The methane is either released directly into the atmosphere or burned in flares and converted to CO₂—in either case increasing greenhouse gas pollutants in the atmosphere. When it is collected, processed and used as a fuel, it can reduce waste and meet customers' energy needs while reducing greenhouse gas emissions," said Nick Mark, manager of conservation and renewable energy policy for CenterPoint Energy.

How it works

The proposed pilot is designed to operate similarly to electric green tariffs, through which customers may choose to spend more to purchase renewable energy. Under the proposal, residential or commercial customers will be able to voluntarily enroll in the RNG program. Customers will decide how much they wish to spend on RNG, with a minimum of $1 per month. As was the case for early electric green tariffs, the initial cost of RNG will be more expensive than non-renewables due to higher production costs and limited supply. While the finalized per-therm cost will be determined after MPUC approval, CenterPoint Energy estimates that RNG will cost approximately $3.89 per therm. In the future, CenterPoint Energy anticipates adjusting the per-therm program price annually based on market supply and customer demand, but these adjustments will not affect the amount charged to customers. Customers who choose to enroll in the RNG program will pay only the amount they designate.

"We've heard from our customers that they want to have options for how they get their energy and that many of them are interested in using more renewable energy," Mark added. "I'm excited to roll out this innovative program for Minnesota customers interested in supporting renewable forms of energy."

Opportunity for public comment

The filing process includes an opportunity for public comment on the program. After reviewing feedback from stakeholders and the public, the Commission will vote on whether the program is approved, denied or needs to be revised. If approved, CenterPoint Energy would start enrolling customers in the late spring of 2019 and have RNG flowing during the 2019-2020 heating season.

Only a handful of energy companies have sought to implement a voluntary renewable natural gas option for customers. The filing responds to customer and local government sustainability goals such as city of Minneapolis' goal to achieve an 80 percent reduction in greenhouse gas emissions by 2050.

"In addition to this being an exciting opportunity for CenterPoint Energy to offer our customers an innovative service, this filing helps advance energy policy and increase the amount of energy we get from renewables. We think it can help Minnesota achieve its energy policy goals as well as achieving environmental benefits," said Mark.

For more information on what CenterPoint Energy is doing to conserve the environment and help the community, see their Corporate Responsibility Report. For more information about CenterPoint Energy's RNG program, visit our website.