Techno-economic assessment of synthetic natural gas production from green hydrogen and carbon dioxide in the Australian context

This paper presents a cost analysis of Synthetic Natural Gas (SNG) produced by methanation of green hydrogen and carbon dioxide (CO 2 ) in the Australian context. A range of CO 2 sources, including biogas, direct air capture (DAC), and industry point sources, is considered. With zero-cost electricity, SNG can be produced for 21–32 AUD/GJ, at a premium of 7–22 AUD/GJ over hydrogen. The important role of technology learning and scale is also highlighted, particularly when biogas is used as a CO 2 source. A key contributor to the cost premium of SNG over hydrogen is the need to produce approximately 28% more hydrogen, whose heating value is converted to heat during methanation. The cost premium of SNG may be justified by its advantages, including compatibility with existing natural gas infrastructure, ease of storage and transport, and the potential for faster market integration.