Life cycle-based multi-objective model for optimal gaseous fuel generation and portfolio allocation in gas grids: A strategic decarbonization

Abstract

Biomethane and hydrogen are acknowledged as transformative opportunities for decarbonizing the conventional gas grid. Essential to this transformation is the modeling of the gaseous fuel supply chain, particularly with hydrogen and biomethane, offering crucial insights for decision-makers. This study introduces a life cycle thinking-based multi-objective optimization model for the integrated design of biomethane and hydrogen gaseous fuel supply chain networks. The model determines optimal resource allocation for the production of the two fuels, integrating them into the conventional gas network. Moreover, it allocates conventional natural gas, biomethane, and hydrogen optimally across building, industry, and transport sectors, considering the life cycle environmental and economic performance of fuel integration paths. Objective functions include minimization of life cycle emissions and levelized cost of energy while maximizing revenue from fuel sales. Integrating life cycle assessment and cost analysis tools, the optimization model quantifies emissions and life cycle costs for biomethane and hydrogen paths. Results identify Pareto-optimal fuel production paths and portfolios, revealing that integrating the alternative fuels into the current gas grid can significantly reduce emissions (up to 250 tonCO2eq/year) and generate substantial carbon tax savings (up to $16,250/year). This model is useful for gaseous fuel industry stakeholders, offering a comprehensive view of supply chain costs and detailed insights into emission benefits when integrating alternative fuels into existing gas networks.