British Gas Giant Centrica Buys Stake in Green Gas Company

Utilities firm Centrica has announced the acquisition of a 50% stake in Barrow Green Gas (BGG), the UK’s leading biomethane—or “green gas”—supplier.

The move from the nation’s largest domestic gas supplier signals a new industry commitment to sustainability and to meeting growing customer demand for renewable energy.

Barrow Green Gas is reportedly the only firm in the UK that focuses exclusively on green gas. Founded in 2012, BGG facilitates the supply of biomethane to gas buyers and provides energy suppliers with Green Gas Certificates (GGCs). According to Centrica, BGG ships almost half the green gas used domestically and commercially in the UK.

Centrica trades and is most recognisable as British Gas and Scottish Gas. This deal gives the gas giant access to BGG’s expertise in the biomethane market, connects BGG to Centrica’s reach in international markets, and will ultimately give environmentally-conscious consumers more access to sustainable gas tariffs.

“We expect the biomethane market to continue to grow across the UK and Europe, underpinned by supportive regulation and growing customer demand for renewable energy,” said Cassim Mangerah, Centrica’s Co-Managing Director for Energy Marketing and Trading.

“We believe this partnership creates a unique platform for us to help grow the green gas market internationally and meet the changing needs of our customers as they transition to renewable energy sources,” he continued.

Energy tariffs have long given consumers access to electricity from sustainable sources but choices for renewable gas options have lagged. Biomethane, known as green gas, is seen as the best alternative to natural gas. It’s a naturally-occurring gas produced by the anaerobic digestion of organic material, including agricultural, domestic, food industry, and industrial waste. It’s a renewable, low-carbon substitute that avoids the heavy carbon footprint and energy- and resource-intensive and controversial drilling processes, including fracking, of natural gas.

Renewable energy suppliers have been expanding their green gas offerings. Good Energy offers a carbon-neutral green gas tariff, with 6% coming from biomethane produced in the UK from manure and sewage, while Ecotricity now supplies gas that is 12% green and plans to open more anaerobic digesters, or ‘gas mills,’ within the next few years, hoping to attain a 100% green gas supply within the next few years. Meanwhile, the government is working with Ofgem to create an official accreditation scheme for green gas suppliers.

Centrica’s investment in Barrow Green Gas and its biomethane infrastructure and expertise signals that green gas isn’t just for the renewable suppliers.

“[BGG] will continue to focus on the needs of the green gas market while being able to offer our customers a wider range of services through Centrica’s position in the wider energy market,” said Tim Davis, Managing Director of Barrow Green Gas.