Denver, Pa.-based UGI Utilities received approval from the Pennsylvania Public Utility Commission to purchase renewable natural gas (RNG) as part of a five-year pilot program.
The pilot program seeks to explore how UGI Utilities, a subsidiary of UGI Corp., can integrate renewable natural gas (RNG) into its supply portfolio to produce economic and environmental benefits for its Purchased Gas Cost (PGC) customers.
This initiative, the first of its kind in the state, allows UGI Utilities to test adding RNG to its supply portfolio while leveraging certain economic incentives for renewables to reduce the cost impact of purchasing RNG for customers
The commission approved it unanimously.
“The approval of this pilot program is a significant step forward as we continue to develop sustainable, environmentally responsible energy solutions for our customers,” Robert Beard, executive vice president of natural gas, global engineering & construction and procurement, said. “UGI remains committed to developing renewable energy sources for the communities we serve.”
RNG is a low or negative carbon energy solution made from organic waste including farm, municipal, landfill and industrial waste. It is a sustainable energy source that is compatible with existing infrastructure when blended with natural gas. It can also be used for residential, commercial, industrial and transportation.
Commissioners Ralph Yanora and John Coleman, Jr. commended UGI Utilities for the pilot program, stating that it “represents an innovative economic model that balances environmental, customer, and gas supply requirements consistent with the Commonwealth’s least-cost gas supply requirements.”
Earlier this year, UGI Utilities signed an agreement with Archaea Energy to accept delivery of RNG into its high-pressure natural gas pipeline that serves its distribution system. The system will be designed to take up to 16,000 mcf (thousand cubic feet) per day of RNG supply.
The natural gas and electric utility serves more than 740,000 customers in Pennsylvania and Maryland.