The Biomethane Certification Scheme (BMCS) is an independent certification scheme (“ICS”) run by Green Gas Trading Limited (GGT) , a private limited company. Green Gas Trading was set up to provide both a credible process for certifying biomethane and a trading platform to facilitate the trading of certificates.
The biomethane certificates issued under the scheme can be traded separately from the physical commodity gas. This allows the certificate owner to transact the physical commodity at the market price for that product whilst seeking the highest economic value for the Biomethane Certificate (“BMC”). Trading the gas and the certificates separately makes it possible to maximise the value of this exceedingly low carbon, green gas at a market determined price.
The BMCS provides the biomethane industry with a means of certifying and trading the “green” or “bio” value of biomethane. The commodity gas (methane) is relatively easy to price as there is a deep and liquid market price for the commodity. However biomethane has additional value by virtue of being produced from energy sources that do not involve the release of fossil carbon into the atmosphere. The fact that biomethane is produced from environmentally occurring carbon i.e. carbon already in the environment, means that it is an intrinsically ultra low carbon fuel – very little “new” (i.e. fossil) carbon is released in its production process. This is important, as much of the economic value of Biomethane Certificates (BMCs) is as a direct result of the carbon saving that is achieved by using biomethane rather than fossil gas.
Uniquely, BMCs can be traded separately from the physical commodity gas. This allows the certificate owner to transact the physical commodity at the market price for that product whilst seeking the highest economic value for their BMCs.
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