Written evidence submitted by Cadent (CGE0015)
Cadent welcomed the publication of the Government’s Clean Growth Strategy last year and remains committed to the development and delivery of fuels and technologies that support the strategy’s key commitments.
Cadent owns and operates four gas distribution networks in the UK, providing a safe, reliable and efficient network that transports gas to homes, schools, businesses from the Lake District to North London and from the Welsh Borders to the East of England. We serve 11m customers across this footprint and are the largest gas distribution company in the country.

Our size and scale ensures that we are a unique position to work collaboratively with the Government to develop and deliver a long-term Clean Growth Strategy which will reflect the critical importance of gas and the gas networks as the most cost-effective and efficient pathway for the country’s transition to a low-carbon energy system.
Cadent fully support the role that innovation can play in meeting the targets, as is emphasised in the strategy and welcomes the committee’s inquiry into the technologies that can help to deliver emissions reduction.
Our submission to this Committee inquiry is based on the foundation of three key principles that Cadent actively promotes:
1. The gas network is critical part of a low carbon whole energy system.
2. To best utilise this valuable asset, long term support for green gas production is required.
3. Support for CCUS at scale, as soon as possible, will help to capitalise on existing and drive further UK based innovation.
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Cadent response to the Science and Technology Committee’s questions:-
The relative importance of the four main areas identified in the Strategy, and whether the Strategy places the right weight on each of those sectors to deliver emissions reductions;
- ‘Improving Our Homes’;
- ‘Accelerating the Shift to Low Carbon Transport’;
- ‘Delivering Clean, Smart, Flexible Power’; and
- ‘Enhancing the Benefits and Value of Our Natural Resources’.
UK emissions by sector[1]

Table 1: Greenhouse gas emissions by sector, 1990-2015[2]

- Based on the emissions produced by sector (2015 data) reported in the CGS and the relative reductions that are reported to have been achieved between 1990 and 2015. It is clear that there is much to do in the areas of transport and home heating. Based on these figures, Cadent supports additional weight being given to the areas of ‘Improving Our Homes’ and ‘Accelerating the Shift to Low Carbon Transport’.
- It is noteworthy that despite its exclusion from the scope of the Committee’s inquiry, the first area identified in the CGS where government plans on delivering emissions reductions is ‘Improving Business and Industry Efficiency and Supporting Clean Growth’[3]. This area represented 25% of the UK’s emissions in 2015 and could be unlocked through securing business and industry buy-in to innovative solutions to emissions reduction. Potential in this area is demonstrated in Cadent’s HyNet concept project (see 4d.)
Progress on meeting carbon budget targets to date and areas where more progress is needed going forward;
- Carbon Capture Utilisation and Storage (CCUS) is a cross-sector solution that can underpin decarbonisation of 4 out of the 5 key sectors (business and industry efficiency, homes, transports, and power) identified in the Clean Growth Strategy:
- CCUS is the only large-scale solution available today for abating emission from energy-intensive industries which produce CO2 as part of their manufacturing process (i.e. cement, steel and chemicals).
- CCUS can contribute to cost-effective decarbonisation of industry, heating and heavy transport through production of large volumes of low-carbon hydrogen.
- CCUS is a key component in the least-cost pathway to decarbonise industrial and domestic heat[4].
- In transport, hydrogen with CCUS could be an enabler for decarbonising the transport fleet, including trucks, trains and shipping. Longer-term, it may also offer the potential for the UK to lead the “green” transformation of the shipping industry.
- CCUS can provide unique value to the power system by providing flexible and dispatchable low-carbon power to balance high penetration of intermittent renewable energy.
- The roll out of CCUS at scale would support the development of hydrogen production, which would stimulate a wider hydrogen economy, which in turn would drive innovation to find new more efficient techniques to produce hydrogen. These new approaches may not require CCUS. The urgent need to reduce carbon emissions does necessitate utilising technologies available today, but doesn’t mean better alternatives will not be developed in future years.
The extent to which current and future technologies can help to meet the carbon budgets; the uncertainty in future technologies’ contribution to emissions reductions, and how that uncertainty can best be incorporated into the Government’s carbon budgets;
- Cadent welcome the Government’s investment in innovation. Cadent is supporting the development and delivery of innovation around decarbonising heat, transport and waste (including agricultural waste) via renewable gas including:
- CNG Refuelling station in Leyland: We have supported the UK’s first commercial high-pressure CNG (Compressed Natural Gas) refuelling station, in partnership with CNG Fuels, which has been operating since March 2016 in Leyland, Lancashire. Connecting directly to the high pressure pipeline is advantageous as it means less energy is needed to compress the gas; significantly reducing running costs and associated emissions. The John Lewis Partnership currently uses the station to fuel its fleet of CNG HGVs. Use of CNG has resulted in cleaner emissions, producing much lower levels of carbon, nitrogen oxides and particulates than diesel. Results from the first 12 months of operation also show that greenhouse gas emissions from the HGVs using the Leyland station were cut by 84% when using biomethane. More information can be found here.
- Biomethane plants across our network: There are currently 31 biomethane sites producing renewable gas connected to our network, drawing from a variety of feedstocks including food waste, sewage and energy crops. We want to increase the amount of renewable gas in our network and by doing so help the government meet their challenging 2050 targets for reducing greenhouse gas emissions, reducing landfill waste and meeting energy demand using sustainable resources. Green gases such as biomethane offer significant decarbonisation opportunities without any consumers having to make any changes to their appliances.
- HyDeploy at Keele University: Working with Northern Gas Networks, this project aims to test the viability and amount of hydrogen which can be injected into the current gas network (up to 20%), without any changes for consumers. Keele University is being used as the site for this project as it has a closed gas network and is a perfect demonstrator with the campus being very similar to a small town. This hopes to demonstrate the potential for a lower cost route to decarbonising the gas network through decarbonising a percentage of the gas without customers having to change their appliances.
- HyNet in the North West: In collaboration with Progressive Energy we have produced an initial conceptual project to deliver a practical and economic framework to introduce hydrogen into the gas network in the Liverpool- Manchester area. This would deliver emissions savings to local industry, homes and transport. The project proposes converting natural gas into clean-burning hydrogen using a combination of steam methane reformation and Carbon Capture Utilisation and Storage (CCUS) technology in depleted offshore gas reserves. Hydrogen would be available for local transport needs, and to blend into the public gas network (subject to the successful completion of the Hydeploy project)
- Cadent also is interested in the ongoing development of Bio Synthetic Natural Gas (Bio SNG) plants. This is where a plasma gasification process could turn black bag waste, and other dry feedstocks unsuitable for biomethane production, into a gas which can be injected into the network. It also produces as a by-product hard core material which can be used in construction. This is one potential way in which we could turn waste into useful products, free up land which is currently used for landfill sites and contribute to waste decarbonisation. If proven, we believe BioSNG with biomethane could produce over 170TWhs of gas, which could decarbonise a large percentage of the domestic heat requirement. This would require policy to encourage the limited feedstocks to be directed towards gas production, rather than less efficient electricity generation/heat[5].
- Investment to support a step change in green gas production requires policy certainty. Currently an unhelpful obstacle to this clarity is the debate about whether green gas is best used in road, transport, heat, power generation or aviation. There is a clear consensus that much higher levels of production are beneficial, so we would urge a decoupling of policy from end use, and the creation of an incentive to build and inject the gas to the gas grid. Once injected, the gas can be used flexibly, its use can change over time, and it can also be stored.
- We welcome continued support for projects that can help companies like Cadent to get the evidence base that enables Government to confidently make positive and ambitious future policy decisions that in turn will deliver the best results for customers at the same time as meeting out emissions targets. There is excellent work coming from other organisations such as Innovate UK, which is supported through the ICSF, BEIS hydrogen supply and CCUS innovation funding, which we further welcome the continuation of. Greater transparency of the gas networks role in supporting Government policy development would of course always be welcomed.
How the development and deployment of technology can best be supported; and the extent to which the Government should support specific technologies or pursue a ‘technology neutral’ approach;
- Development and deployment of technology is best supported by, wherever possible, clear and long term commitments from Government that provide security for businesses operating in this space. Investment in the large scale projects that are required to deliver the level of emissions reduction that the Government needs is extremely difficult to deliver in a climate of uncertainty.
- CCUS is not one technology, however support for it unlocks a range of technologies that are being developed to provide solutions in multiple sectors where emissions are greatest and most damaging including Industry, Power, Heat and Transport & Storage (T&S). Whilst these different sectors each have different needs, Government support for the foundation technology CCUS, will ensure that innovation and R&D into sector specific solutions will continue.
The relative priority that should be attached to developing new technologies compared to deploying existing technologies, including consideration of the costs and pollution involved in the decommissioning of technologies or infrastructure;
- We believe that gas, and the existing gas networks, have a critical role to play in reducing carbon emissions and improving air quality. There is an increasingly strong evidence base that shows that that re-purposing the gas network to deliver sustainable, renewable, low carbon gas represents the best value for consumers and tax payers. This is supported by the KPMG report[6], ‘2050 Energy Scenarios’, the Policy Exchange ‘Too Hot to Handle’ report[7], the Policy Connect ‘Next Steps for the Gas Grid’ report [8]and the Energy Research Partnership ‘The Transition to Low-Carbon Heat’ report[9].
- In comparison, the power grids do not have enough capacity to deliver a costly, electric only future. These economic studies suggest that the cost of electrification of heat could be billions of pounds more expensive than a pathway which seeks to “green” the existing gas network. Using the gas network would be over £10,000 cheaper per customer between now and 2050. The construction of extensive, and in many cases highly visible electricity infrastructure may also be resisted by the general public, when a much lower impact alternative exists which utilises existing highly reliable and far less obtrusive infrastructure.
- The use of gas, with addition of increasing renewables such as biomethane, Bio-SNG and hydrogen, can support the phasing out of coal and oil, decarbonise heat, transport and waste and provide the least cost, least disruptive pathway to a zero carbon economy and clean air environment. What is more, the infrastructure and capacity to deliver clean fuels at scale across the UK is in place today through the existing gas networks, and we are ready to take up the clean growth challenge.
- The reuse of existing oil and gas assets offer a low cost, practical opportunity for the UK’s first CCUS infrastructure, and avoids or postpones decommissioning costs as demonstrated through Cadent’s HyNet project. The decommissioning costs are estimated to be in the region of £0.5bn to be paid jointly by government and industry. Early technical collaboration on these sites can maximise the value from re-use of different areas to include additional components such as the pipeline and rigs.
Examples of specific technologies whose development and deployment have been effectively supported so far, as well as those that show particular promise for meeting the Government’s carbon emissions targets or supporting the UK’s economy, or which would benefit from specific Government action, in the future;
- Energy produced from offshore wind has been extremely successful to date, therefore there is a model by which a delivery pathway could be established for CCUS. The hydrogen economy and CCUS could create jobs and a new skills market across the whole of the UK with the CCSA & TUC reporting that the UK’s GVA in the CCUS sector could increase to between £5 billion and £9 billion per year by 2030.[10]
- We would note however that the increasing levels of intermittent renewable generation must have secure controllable reliable sources of back up e.g. when it is dark and the wind isn’t blowing. Batteries can play a small part in short term support, but to deliver a viable secure electricity grid, gas fired generation is currently the only credible option. This is backed up by the increasing levels of small scale gas generation we are seeing connect to the gas distribution networks. This is both for energy security, but is also installed where electricity grid constraints exist and the end user needs reliable power in shorter timescales than those for the gird reinforcement works. Economic growth requires new energy capacity at scale and at pace. The increasing intensity of the use of the electricity grid will make new capacity much harder to access, with gas generation providing the alternative solution to support the growth that is critical to the UK economy.
The role of the Industrial Strategy ‘Clean Growth Grand Challenge’, and what the Government should do to ensure it contributes effectively to meeting emissions targets.
- As Cadent operates four different networks across the UK, we are actively engaging at a regional level with Metro Mayors, the combined authorities that they represent and the LEP’s that operate in their regions, as they develop their own individual responses to the Industrial Strategy. We believe that this approach will cultivate the most effective clean local energy solutions for customers that build upon the existing energy infrastructure within a region. Ensuring flexible funding is in place so that regulated networks can support these regional plans we believe must be a cornerstone of the evolving regulatory framework.
- The Industrial Strategy’s five foundations of productivity is a useful lens through which to view innovation and technologies and both consider and measure their value and potential for success.
- Ideas: Creation of new low-carbon products such as low/zero carbon steel, cement, hydrogen, contributing to an innovative economy. Carbon Capture and Utilisation (CCU) can contribute to improving material efficiency by reusing CO₂ in innovative processes.
- People: Creation and retention of highly skilled jobs in leading UK sectors which are at risk due to the necessity to decarbonise the economy.
- Infrastructure: Development of low-carbon industrial clusters would be a major upgrade to UK infrastructure for a decarbonised economy, supporting regional growth.
- Business environment: The climate and sustainability agenda is becoming increasingly important to private sector companies and shareholders and will shape future business decisions. Providing decarbonisation infrastructure will attract businesses wishing to compete in a low-carbon economy and contribute to clean growth.
- Places: Areas of concentrated industrial activity tend to be outside the southeast and have lower economic growth; in this way creating low-carbon industrial clusters can help to rebalance productivity across UK regions by enabling retention and growth of the skilled industries on which these local economies rely.
The development of CCUS clusters in key UK industrial regions can transform these regions into low-carbon industrial zones.
October 2018