Decarbonization of the building sector by strengthening the role of natural gas

Between the production of the necessary materials, construction, operation, and end-of-life management of a building, the sector’s share of the national Carbon Footprint was estimated in 2019 at approximately 25%, 67% of which was attributable to the operation phase (ADEME BâtiZoom 2019 figures).

While the climate emergency demands that we accelerate the Energy Transition, the massive shift toward electric solutions or district heating networks sometimes seems like the logical path to reducing the building sector’s carbon impact. However, reality calls for a more nuanced approach in which natural gas has a vital role to play, to avoid technical, economic, and social pitfalls that could jeopardize the achievement of these goals.

Surprising? Paradoxical? Not at all.

Because gas is no longer just a fossil fuel. Because it is becoming green, renewable, and low-carbon. Because it remains efficient and compatible with all current uses.

The Origins of Gas Use

In the 19th century, Natural Gas was not yet being extracted, and what was then called “town gas” had to be manufactured. Produced from wood and coal coke, it was initially used for street lighting before finding its way into homes around the turn of the 20th century. Cooking, hot water, and heating—its uses diversified at a time when heating needs still depended mainly on solid fuels (coal and wood).

The spread of gas into homes gained momentum during the first half of the 20th century, driven by a desire for progress, falling costs, and a network that could now supply gas to customers farther from production sites.

By 1930, 130,000 kilometers of gas pipes were already delivering town gas to more than 5 million subscribers (source: Coénove – Decarbonization of Buildings, the Key Role of Green Gases).

The discovery of the first Natural Gas fields in France (1939 and 1960) and the Netherlands (1967), combined with the development of import and transportation infrastructure, marked the end of town gas but solidified gas’s role in the building sector, including in district heating systems. 

Less restrictive and costly than coal and heating oil, it offered instant power and comfort to a population seeking modernity.

Beyond Home Heating

Today, natural gas is integrated into the operation of a wide diversity of buildings due to its calorific properties and cost-effectiveness.

In addition to supplying individual and multi-family homes with heating, hot water, and cooking, it is used in the commercial sector—particularly in offices, schools, and hospitals—as well as in sports facilities and public and cultural buildings. Not only does gas help maintain comfortable and easily adjustable conditions in these settings, but it can also regulate the temperature of a swimming pool or contribute to the preservation of works of art.

Hotels, restaurants, and certain food establishments also choose it for the precision it brings to professional cooking.

Gas-connected buildings

The Gas Distribution Network currently serves 9,600 municipalities in metropolitan France. By covering primarily densely populated areas, this network enables approximately 77% of the population to use gas as one of their energy sources for heating, cooking, or producing domestic hot water.

Decentralized Sectors

Not all buildings supplied with gas are necessarily located in urban or suburban areas. Some are scattered across vast areas and have been connected to the Gas Distribution Network as opportunities arose and based on their region’s gas needs.

Conversely, more than 24,500 municipalities are not connected to the Gas Distribution Network. These are spread across rural areas, mountainous regions, and more isolated areas, where difficulties in access and/or low building density did not justify extending the distribution network.

Although residents in these areas cannot use natural gas from the grid, they still rely on storable fossil fuels such as heating oil, butane, or propane to meet their heating needs.

The Energy Mix for Building Heating

A multitude of factors can therefore influence the choice of a heating solution in a building. Thus, beyond the availability of energy sources, economic constraints, performance requirements, and changes in regulatory frameworks have shaped a varied and diverse landscape over the years.

The path set by public authorities

Compliance with the European roadmap “ Fit for 55 ” (see box) and the national commitment to Carbon Neutrality by 2050 require France to raise its ambitions for the building sector: reducing energy consumption, High-performance Energy Renovation, phasing out fossil fuels, and greening energy sources—the measures primarily concern building operations.

The draft documents for the future National Low-Carbon Strategy (SNBC3) and the new Multiyear Energy Plan (PPE3) explicitly raises the targets for 2030, prioritizing large-scale electrification and unconditional support for district heating networks.

Overview of the main regulations in effect

The transformation of the building stock is based on a series of national and European regulations that govern New Construction, renovation, and energy consumption planning.

The baseline scenario considered by the French Electricity Transmission Network (RTE)

Each year, RTE publishes its Forecast Report, which public authorities consider the benchmark study for supporting the national Decarbonization trajectory through the electrification of end-use sectors.

In the Buildings section of the 2023 edition, the selected scenario gives pride of place to electric Heat Pumps, with a target of 8 million units installed in residential buildings by 2030 and 11.5 million by 2035, while also anticipating a 45% reduction in the number of gas boilers (6.1 million in 2035 vs. 10.8 million today).

Given that the number of homes primarily heated by electric HPs was 3.2 million in 2024, with growth limited to +440,000 between 2023 and 2024 (source: CEREN), the target is ambitious. Especially since, to support the feasibility of its scenario and overcome the limitations of the electric grid—such as Peak Demand (see box)— RTE is counting on an acceleration of Energy Renovations, the development of Demand response measures, the construction of new capacity for Peak Demand, and the reinforcement of the power grids. 

Furthermore, for reasons of cost and realism, these assumptions may be deemed difficult or even impossible to achieve from a social and industrial perspective.

The Renovation Roadmap

Actual statistics on large-scale renovations remain well below the targets set by European and French policies, whether for insulation work or for replacing equipment to phase out heating oil and coal, for example.

On the one hand, while the associated costs play a role, the instability of financial assistance programs—including reforms to MaPrimeRénov', changes to the Energy Efficiency Certificate (CEE), and eligibility requirements—makes the programs difficult to understand and slows down the start of renovation projects. Not to mention the rise in fraud in this area...

On the other hand, caught between installation targets set by policymakers and a market that is struggling to find the necessary momentum, HVAC manufacturers face a complex equation that complicates their own commitment and the mobilization of their production lines.

Adapting the Electrical System

As we have already seen, the role of natural gas in buildings for heat production is far from insignificant. Beyond the exorbitant costs associated with converting equipment in buildings, the widespread electrification of heating can only be achieved at the cost of colossal investments in existing electricity generation, transmission, and distribution infrastructure.

• Changes in electricity demand: the aging of the nuclear fleet and the forced shutdown of half of the reactors in 2022 have highlighted the weaknesses of the current system. According to RTE projections, a massive shift toward electric heating—even if accompanied by appropriate renovations and supported by high-performance equipment—could require an increase of at least 3 GW in peak thermal capacity by 2030. To date, the flexibility resources that can be relied upon to handle these peaks consist of thermal power plants primarily fueled by… gas.
• Cost of upgrading the electric system : By 2035, investments in generation and flexibility capacity are expected to triple to €25 to 35 billion per year, assuming that gross production costs remain unchanged. The grids deployed by RTE and Enedis must also be upscaled to supply the power required by all this new electrical equipment. The estimate put forward by the Distribution System Operators is around 200 billion euros to be financed by the French public by 2040, divided equally between the transmission grid and the distribution grid.

The Benefits of Green Gas

Produced through the recovery of organic waste from local communities, Biomethane is currently the most widely used green gas in France. By converting Livestock Effluents, agricultural residues, energy-from-agricultural-crops (CIVE), agrifood byproducts, household biowastes, and sewage sludge, Anaerobic Digestion is playing an increasingly important role in the energy landscape while helping to achieve Decarbonization of gas consumption.

To learn everything there is to know about Green Gas, visit our in-depth feature.

With an emission factor of 41.6 gCO2eq/kWh, Biomethane’s carbon footprint is nearly six times lower than that of Natural Gas. The gradual transition from fossil fuels to Renewable Gases should thus help reduce CO2 emissions associated with gas use by more than 80%. (source: ADEME Carbon Footprint Database)

With the growing use of other Renewable Gases and low-carbon gases, the Green Gas Value Chain estimates that Green Gases will be able to cover 20% of all French consumption by 2030, more than 40% by 2035, and 100% by 2050, with a long-term production potential estimated at 320 TWh per year. 

These projections are based on a downward trend in consumption and a demand of 321 TWh in 2030, 282 TWh in 2035, and 235 TWh in 2050 (compared to 350 TWh in 2025). (Sources: NaTran’s 2024 Gas Outlook and 2025 Gas Report)

An Essential Ally in Coping with Peak Demand

In France, the Gas Network helps support the electric grid when temperatures drop and electricity demand skyrockets. The widespread use of gas systems in buildings, combined with the generation capacity of gas-fired power plants, ensures that these occasional spikes can be handled with ease.

During these periods, the HHP can temporarily “engage demand response” on the power grid and switch entirely to the High Energy Performance Boiler until conditions return to normal.

By way of comparison, the electric grid has a mobilizable peak capacity of approximately 100 GW, whereas the gas network offers 160 GW. On February 8, 2012, a cold snap set a record of 102 GW in electricity demand and 158 GW in gas demand, preventing a “blackout.”

To learn more about gas during periods of extreme cold, click here.

Cost Savings for Renovation

Not only do gas solutions avoid adding to the costs of adapting the electric grid, but the transformation of gas networks to collect and distribute Green Gas has a much smaller impact than the transformation required for electric grids. In 2023, the Energy Regulatory Commission (CRE) estimated the budget needed to accommodate Green Gas between 6 and 9.7 billion euros by 2050. In total, the planned investments in gas networks are about seven times lower than those planned for the electric grids.

To take the decarbonization of buildings even further, billions of euros could thus be redirected toward energy-efficient, equitable, and sustainable renovations of energy-inefficient buildings for the community.

Let’s also not forget that, on a smaller scale, gas-based solutions such as HHPs offer savings on equipment and maintenance, freeing up additional financial resources for building improvements.

Why Keep Natural Gas in the Building Sector?

With more than 50% of the building stock unable to be electrified, the building sector needs to rely on a diversified energy mix that incorporates all solutions that work and deliver concrete, immediate benefits. This helps meet climate goals, ensure a secure energy supply, and protect the purchasing power of households and communities.

Reducing the building sector’s Energy Transition to electrification alone ignores the constraints inherent in the diversity of buildings, Winter Peak, the seasonality of demand, and regional specificities. Choosing to preserve a true Energy Mix means choosing not to put all your eggs in one basket; the complementary nature of gas and electricity ensures resilience and minimizes the costs of upgrading grids.

Common-sense alternative scenarios

Building on this pragmatic approach, Coénove conducted a study with the consulting firm Artelys and proposes alternatives to RTE’s baseline scenario. The main finding is that by relying more heavily on gas-based solutions and incorporating domestic hot water use into the calculations, it is not only possible to achieve the same level of Decarbonization as by relying solely on electric HP’s, but at a lower cost.

If, by 2030, 700,000 electric air-to-water HPs are replaced with HHPs in RTE’s baseline electrification scenario, the benefits are clear:

A scenario incorporating more High Energy Performance Boilers increases the savings even more significantly (€1.1 billion saved per year) without significantly worsening the environmental impact.

And with the share of Green Gas exceeding 20% instead of 10%, decarbonization is significantly greater than in RTE’s baseline scenario—which has been adjusted to account for the technical constraints of Heat Pump installation—at a virtually identical cost.

Recognizing the crucial role of hybridization and Green Gas

Promoting HHPs is essential, particularly when electric HP units face technical or economic installation constraints. Public incentive programs must take into account the realities on the ground.

Furthermore, the 20% share of Green Gas expected by 2030 represents a pragmatic, easy-to-implement solution that is industrially mature and consistent with the sector’s trajectories.

Stakeholders in the building sector, utility networks, and local governments are calling for a scaling up of Green Gas production and for these gases to be incorporated into French and European regulatory frameworks. The goal: to accelerate a just, technically realistic, and socially acceptable transition. 

Traceability through Certificates of Origin (CoO) must therefore be integrated into the Energy Performance Certificate (DPE), the RE2020, and the transposition of the European Energy Performance of Buildings Directive (DPEB), in order to truly reflect the reduction in the Carbon Footprint of buildings powered by Biomethane.