Platts launches North America Renewable Natural Gas Premiums May 15

Platts, part of S&P Global Commodity Insights, has launched two daily premiums for North America Renewable Natural Gas (RNG) and a North America RNG Carbon Intensity value-per-point assessment.

The North America Renewable Natural Gas Premiums capture the value of the environmental attributes of RNG above the price of pipeline natural gas. This premium can be used to establish market prices for RNG at natural gas hubs in North America.

With state and federal incentives in place for RNG producers who sell into transportation fuels markets, the value of these incentives can provide a foundation for RNG transactions -- both as a marker of value for use as a transport fuel and as the "price to beat" to divert supply away from transport fuels markets to other uses.

Platts publishes two North America Renewable Natural Gas prices that reflect the premium that pipeline quality RNG receives to pipeline-quality gas delivered on a spot basis in North America.

The North America Renewable Natural Gas Premium (California) price reflects the RNG premium for gas consumed in California with a pathway that has a carbon intensity, or CI, of 45 and includes the additional value from California LCFS credits. The CI of 45 represents the CI of a landfill.

The North America Renewable Natural Gas Premium (excluding California) price reflects the RNG premium for gas consumed outside of California and uses current-year D3 Renewable Identification Numbers as a starting point.

The North America Renewable Natural Gas CI value-per-point price represents the change in value of the North America Renewable Natural Gas Premium based on a one-point decrease in the carbon intensity. The price varies based on the value of the prompt quarter LCFS credit price.

The RNG prices are assessed at a 1:30 pm CT timestamp and are published each business day according to the Platts Houston holiday schedule in US dollars per million Btu (MMBtu).

Platts uses trades, bids, offers and indicative values from market participants to inform the assessment process for the RNG prices. In the absence of spot market information, Platts may refer to associated markets including the per MMBtu value of current-year D3 RINs and prompt-quarter California LCFS credits. The LCFS credit value for RNG is calculated using California Air Resources Board formulas. Platts uses the current compliance year for diesel reference fuel with a Vehicle-Fuel EER of 0.9 in $/MMBtu of gas based on the current LCFS regulation from the Air Resources Board. The North America Renewable Natural Gas Premium, Ex-California price is based only on the cellulosic biofuel D3 RIN price for the current year and does not include LCFS credit values.

The new assessments are available in Gas Daily, as well as in Platts Dimensions Pro and in the Platts Pricing database under the following codes:

Please send any feedback, questions or comments to Platts_Carbon@spglobal.com and pricegroup@spglobal.com.

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