The Rise of ‘NextGen’ Natural Gas

Chattanooga Gas announces 100% of its fuel supply for residential and small business customers now comes from Next Generation Natural Gas through an agreement with Williams Sequent Energy.

Lying along the Tennessee River, nestled among the pristine Blue Ridge Mountains is Chattanooga. Home to over 180,000 residents, the city has received national recognition for its fast growth and quality of life. As a hub of industry and transportation in both Hamilton and nearby Bradley County, the region requires a fuel supply that is clean, safe, reliable and affordable.

That’s where Southern Company Gas subsidiary Chattanooga Gas comes in. In business for more than 150 years, Chattanooga Gas delivers natural gas to about 70,500 customers in southeast Tennessee.

Chattanooga Gas announced today that 100% of the natural gas it delivers to residential and small business customers is procured, transported or delivered by companies that are reducing their methane emissions. Through a new agreement with Williams’ Sequent Energy Management, customer supply is being sourced with “Next Generation Natural Gas,” also known as certified, low-emission natural gas.

“Our NextGenGas supply is certified to be produced with lower GHG emissions than traditional natural gas supply. Our customers can feel good knowing we have strong relationships with environmentally conscious suppliers focused on reducing methane emissions efficiently and effectively during the production cycle,” said Pedro Cherry, president and CEO of Chattanooga Gas.

The company says that it will be able to support an estimated minimum annual emissions reduction savings of approximately 646 tonnes of methane, or 16,152 tonnes of carbon dioxide – equivalent to removing the emissions of more than 3,500 gasoline powered vehicles from the road for a year.

This transaction of NextGenGas in the Chattanooga Gas service territory underpins a larger economy-wide decarbonization effort across the natural gas supply chain according to Joanne Mello, vice president of Corporate Sustainability for Southern Company Gas.

“Upstream, midstream or downstream, the natural gas industry is working to reduce GHG emissions across our value chain through forward-thinking partnerships like this,” said Mello, adding, “Today’s announcement is complementary to other sustainability efforts underway at Chattanooga Gas, including its goal to achieve net zero GHG emissions from its operations by 2050.”

Chattanooga Gas’ milestone is one of several similar efforts underway at utilities across the country owned by Southern Company Gas. Southern Company Gas subsidiary and Chattanooga Gas sister company Virginia Natural Gas first procured Next Generation Natural Gas for its customers in 2019, and today up to one-half of its customers’ energy demands are being supplied with this lower-emissions product. Southern Company Gas’ Illinois-based utility, Nicor Gas, has also sourced fuel from environmentally conscious suppliers.

This system-wide initiative at Southern Company Gas is complementary to the business’s sustainability efforts, including its long-term effort to reach net zero GHG gas emissions from its operations by 2050.

The procurement is also a result of the Tennessee Natural Gas Innovation Act, Senate Bill 1959, signed into law in 2022. The state legislation enables natural gas utilities to build and procure innovative natural gas resources including, but not limited to, farm gas, biogas, renewable natural gas and attributes, hydrogen, carbon capture, qualified offsets, Next Generation Natural Gas and energy efficiency resources.

The legislation also allows the Tennessee Public Utility Commission the authority to authorize a mechanism to recover costs related to incremental innovative natural gas costs to procure resources from third parties, while the total incremental costs cannot exceed 3% total annual cost of gas.

For more information on Southern Company Gas’ sustainability journey, read more here.