5.2 Commercial Combustion - Natural Gas
| Category ID | Description | EIC |
|---|---|---|
| 307_com | Natural Gas | Various |
| 1591 | Natural Gas (area source) - Commercial | 6099501100000 |
Introduction
Categories 307_com and 1591 account for Commercial sector greenhouse gas (GHG) emissions from the combustion of natural gas in commercial equipment, both permitted and non-permitted, respectively. ‘Permitted’ is defined as requiring a permit or registration issued by the Bay Area Air Quality Management District (Air District) to operate a facility and/or equipment in the San Francisco Bay Area (SFBA). However, not all sources are required to obtain a permit or registration, especially in those cases, if the source is below a certain size or emission rate threshold as specified in the Air District regulations. Category 1591 ensures that emissions from these smaller, non-permitted sources are included as area sources in the inventory.
Natural gas, that is used as fuel to power commercial equipment, is composed primarily of methane with small amounts of other hydrocarbons such as ethane, propane, and butane (see Uncertainty section). The GHG emissions reflected herein include combustion by-products carbon dioxide (CO2), methane (CH4), and nitrous oxide (N2O), emitted from the combustion of natural gas in commercial water heaters, boilers, furnaces, ovens, process heaters, and any other device that burns natural gas and is used for commercial purposes. Emissions from combustion of natural gas for fueling similar equipment in the Residential sector are accounted for in Categories 283, 284, 285, and 2540.
Methodology
Permitted Sources (Category 307_com)
Category 307_com is a point source category that includes emissions from natural gas combustion in permitted large commercial equipment with heat input ratings of 2 Million British Thermal Units per hour (MMBTU/hr) or more. These sources are regulated by the Air District and operate under a permit to operate (PTO), which authorizes them to emit air pollutants from a fixed location. This equipment includes commercial boilers, process heaters, and steam generators with a heat input rating greater than 2 MMBtu/hr.
As part of the permitting process, the Air District collects information from the operating facility and/or determines from published literature like United States Environmental Protection Agency’s (USEPA) AP-42 (USEPA, 2016), characteristics of a source including maximum throughput, emission factors for emitted pollutants, and control factors associated with downstream abatement devices. This data is then compared against the Air District’s Regulations to ensure compliance. Facilities that hold a PTO are required to renew their permit periodically (this period varies based on facility and source type). Upon renewal, the facilities are requested to provide any updates to source characteristics as well as the source throughput for the past twelve months. This throughput, in combination with the emission factors and controls factors stored in the Air District’s internal database, are used to programmatically estimate annual emissions at the source level.
The methodology used to calculate emissions for the reported base years for permitted point source category # 307_com is as follows:
Base Year(s) Emissions source,pollutant =
Activity Data source × Emission Factorpollutant × Control Factorpollutant × GWP pollutant
Base Year(s) Emissions county = ∑ Ni=1 Emissionsi
Where:
- Base Year: is a year for which activity / throughput data is available in the internal permit database.
- Activity Data source: is the throughput or activity data for applicable base year(s) at the source/equipment level reported to the Air District during the permitting process (or estimated by Air District staff). This data is usually available from the internal permit records that are provided annually to the Air District at permit renewal by a source / facility operator.
- Emission Factorpollutant: is a factor that allocates an amount of emissions, in mass, of a particular pollutant by unit of activity data. For example, tons of CO2 per gallon of gasoline burned or pounds of N2O per million standard cubic feet (MMSCF) of natural gas combusted. This factor generally comes from a published literature source such as United States Environmental Protection Agency’s (EPA) AP-42 (USEPA, 1998) or CARB’s Mandatory Reporting Requirement (MRR) for Greenhouse Gases (CARB, 2019).
- Control Factorpollutant : is a fractional ratio (between 0 and 1) that captures the estimated reduction in emissions as a result of Air District rules and regulations.
- GWPpollutant is the Global Warming Potential of a particular greenhouse gas (GHG) pollutant. The current version of the GHG emissions inventory incorporates the global warming potential (GWP) reported in the Fifth Assessment report of the Intergovernmental Panel for Climate Change (IPCC, 2014). The GWPs for the three principal GHGs are 1 for carbon dioxide (CO2), 34 for methane (CH4), and 298 for nitrous oxide (N2O), when calculated on a 100-year basis with climate-carbon feedback included.
- N is the number of permitted and similar sources in a county.
If available, a facility can provide emission factors specific to the source that are verified and validated through source tests to estimate GHG emissions. If no specific emission factors are available, general factors developed by Air District staff are used to estimate emissions. These source level emissions are then sorted and aggregated by year, county, and category.
Further speciation and quality assurance of emissions, including those of GHGs, are performed as a part of the inventory refinement process. A systematic crosswalk has been developed between CARB’s California Emissions Projection Analysis Model (CEPAM) source category classification using the primary sector (emission inventory codes (EICs)) and the Air District’s source category classification (category identification number - cat_ids), which ensures consistency when reporting annual emissions under the California Emissions Inventory Data Analysis and Reporting Systems (CEIDARS) to California Air Resources Board (CARB; CARB, 2022a). This emissions data represents the reported base years emissions for a point source category.
Once base year emissions are determined, historical backcasting and forecasting of emissions relative to the base year emissions are estimated using growth profiles as follows:
Current Year Emissionscounty = Base Year(s) Emissioncounty x Growth Factor
Where:
- Growth Factor: is a scaling factor that is used to derive historical emissions estimates for years for which activity data and/or emissions are not available, and to forecast emissions for future years, using surrogates that are assumed to be representative of activity and/or emissions trends.
Category 307_com uses the methodology outlined above with the following reported base years, backcast, and projections:
- Historical backcast from 1990 to 2006 was derived by extrapolating historical throughput trends from ABAG (ABAG, 2024)
- Emissions for permitted commercial boilers for years 2007-2022
- Future projection for 2023 to 2050 is based on California Energy Commission’s (CEC) IERP 2023 Programmatic Scenario 3 with AAFS and AAEE applied (CEC, 2023c). This is further described in the Future Projections under Area Sources (Category 1591) subsection below.
The future projection/growth profile is the same as the one used for category 1591 and described in further detail above in the Area Sources (Category 1591) subsection.
Local Controls
The emission reductions associated with the adoption of Air District Regulation 9, Rule 7: Nitrogen Oxides and Carbon Monoxide from Industrial, Institutional, and Commercial Boilers, Steam Generators, and Process Heaters (BAAQMD, 2011) have been fully realized and incorporated into the allowed permitted emissions for regulated commercial equipment. There is no impact of the above-mentioned criteria air pollutant-specific rules on GHGs emissions from the regulated equipment, that has not already been accounted for in permitted emissions. Hence, no separate controls need to be applied to the derived/reported GHG emissions. For an account of how controls are applied to emissions calculations, refer to Emission Factors and Local Controls under Area Sources (Category 1591) subsection below.
Area Sources (Category 1591)
Category 1591 is classified as an area source category because it includes emissions from small commercial heating sources—those with heat input ratings between 0.75 and 2 MMBTU/hr, that are not subject to annual permitting by the Air District. The data used to estimate emissions for these sources must be extracted from either the California Air Resources Board (CARB) or California Energy Commission (CEC) databases. The methodology used to calculate emissions for the reported base years for this source category is as follows:
Base Year(s) Emissions county,pollutant =
Activity Data × Emission Factorpollutant × Control Factorpollutant × Fractioncounty × Fractionin District× GWP pollutant
Where:
- Base Year: is a year for which activity / throughput data is reported by CEC and/or CARB, and available.
- Activity Data: is the throughput or activity data for applicable reported base years. This data may be determined in one or two ways:
- Apportioning Larger-Scale Data: Throughput data from a larger domain, such as state or national level, is scaled using the proportion of a representative metric in the regional domain relative to the larger domain. For example, the ratio of a county’s population to the state population can be used as a scaling factor to determine the county throughput from state-level throughput.
- Using Local Sources: Alternatively, data from a locally published and verifiable source may be used, such as the county-level natural gas usage data provided by the CEC.
- Emission Factorpollutant: is a factor that allocates an amount of emissions, in mass, of a particular pollutant by unit of activity data. For example, tons of CO2 per gallon of gasoline burned or pounds of N2O per million standard cubic feet (MMSCF) of natural gas combusted. This factor generally comes from a published literature source such as USEPA AP-42 (USEPA, 1998) or CARB’s Mandatory Reporting Requirement (MRR) for Greenhouse Gases (CARB, 2019).
- Control Factorpollutant : is a fractional ratio (between 0 and 1) that captures the estimated reduction in emissions as a result of Air District rules and regulations.
- Fractioncounty : is the fraction of total regional emissions (between 0 and 1) estimated to be allocated to a particular county. It is typically derived from regional socioeconomic metrics and/or actual county-level throughput data.
- Fractionin District : The Air District jurisdiction covers only a portion of Solano and Sonoma County. For this reason, additional allocation must be made for these counties to determine the proportion of the county’s emissions occurring within the Air District’s jurisdiction.
- GWPpollutant is the Global Warming Potential of a particular greenhouse gas (GHG) pollutant. The current version of the GHG emissions inventory incorporates the global warming potential (GWP) reported in the Fifth Assessment report of the Intergovernmental Panel for Climate Change (IPCC, 2014). The GWPs for the three principal GHGs are 1 for carbon dioxide (CO2), 34 for methane (CH4), and 298 for nitrous oxide (N2O), when calculated on a 100-year basis with climate-carbon feedback included.
Once base year emissions are determined, historical backcasting and forecasting of emissions relative to the base year emissions are estimated using growth profiles as follows:
Current Year Emissionscounty = Base Year(s) Emissioncounty x Growth Factor
Where:
- Growth Factor: is a scaling factor that is used to derive historical emissions estimates for years for which activity data and/or emissions are not available, and to forecast emissions for future years, using surrogates that are assumed to be representative of activity and/or emissions trends.
More details on the inputs and variables used above are provided in the following subsections:
Activity Data
The reported base years for source category 1591 are the years 2011 – 2019. The datasets used to determine throughputs for the reported base years for the Commercial sector are listed below:
- CEC Natural Gas Usage in Therms by County and by Residential and Non-Residential sectors, years 1990 – 2022 (CEC, 2023a),
- CEC Natural Gas Usage in Therms by County and by Economic sector, years 1990 – 2022 (CEC, 2023b), and,
- Reported natural gas throughputs by permitted industrial and commercial facilities to the Air District for years 2011-2019.
For this category, facilities subject to the registration requirements in Regulation 9, Rule 7 (BAAQMD, 2011) reported their annual throughput to the Air District from 2011 to 2019. In 2011, the Air District’s registration program for small commercial boilers and process heaters came into full effect, but prior to 2011 the throughput for these devices was not reported to the Air District. Therefore, the year 2011 is considered to be a representative year for historical backcasting, as it is the first year where throughput from these registered boiler/heaters were recorded.
In a similar manner, the year 2019 is chosen to be a representative year for estimating future trends as it is the last year where natural gas throughput data was collected from these registered sources.
Prior to collecting direct natural gas usage from registered facilities (in the 1990s and 2000s), the CEC Natural Gas Usage by Residential and Non-Residential sectors was used to estimate emissions. To remain consistent with historical calculations, the same data set is used but the Air District now uses a refined approach for proportioning natural gas usage to the non-permitted area source in the Industrial and Commercial sectors using an additional CEC Natural Gas Usage by Economic sector data set. After determining the amount of natural gas used for the Commercial sector for the SFBA using the two datasets, the natural gas usage of commercial point sources, based on the Air District’s registered dataset (category 307_com), are subtracted from CEC’s natural gas usage for the Commercial sector to avoid double counting. Not all of the natural gas that is delivered across the region is combusted, some is lost due to post-meter leakage. Therefore, an additional natural gas loss based on the leakage rate of 0.28% for commercial appliances (CEC, 2020a) is applied.
To summarize the calculation explained above, below is a simplified example calculation of throughput for a county for a single year:
Commercial Natural Gas Usage for Category 1591 =
(CEC Natural Gas Usage × % Commercial Usage – Commercial Natural Gas Usage for Permitted Sources) × (1-Post-Meter Leakage Rate)
The NG-throughput for the commercial sector derived above can be further sub-divided (if called for) into various end-use sub-sectors. This sector-wise split is based on emissions information from a Pacific Gas & Electricity (PG&E) service area report on commercial end-use (PG&E, 2003).
Water Heating | Cooking | Other/Miscellaneous | |
31% | 38% | 22% | 9% |
County Distribution / Fractions
In this case, no additional county distribution needs to be applied as all throughput data is already available at the county level from CEC and CARB.
| ID | Description | ALA | CC | MAR | NAP | SF | SM | SNC | SOL | SON |
|---|---|---|---|---|---|---|---|---|---|---|
| 1591 | Natural Gas (area source) - Commercial | 0.22 | 0.07 | 0.04 | 0.03 | 0.10 | 0.18 | 0.26 | 0.03 | 0.06 |
| 307_com | Natural Gas | 0.21 | 0.08 | 0.00 | 0.02 | 0.37 | 0.14 | 0.16 | 0.01 | 0.01 |
BAAQMD Jurisdiction Fraction
The BAAQMD jurisdiction only accounts for a part of Solano and Sonoma counties. The remaining area is covered by other Air Districts. For category 1591, the percentage of Solano and Sonoma County populations within the Air District boundary (or jurisdiction) are estimated using the Association of Bay Area Government’s (ABAG) Plan Bay Area 2050 dataset (ABAG, 2021). The dataset summarizes population by Travel Analysis Zones (TAZs). The population for each TAZ within Air District’s jurisdictional boundaries is summed and divided by the total county-wide population to estimate the percentage of population within the SFBA for Solano and Sonoma counties. These proportions are shown below:
County | % of Population within the District’s jurisdiction |
Solano | 0.70 |
Sonoma | 0.86 |
Emission Factors and Local Controls
As mentioned above, the emission factors for this category are dependent on the control factors. The combination of these two factors produces the Effective Emission Factor used in the emissions calculations. The Effective Emission Factor represents average emissions emitted from a natural gas combustion boiler/heater with add-on pollutant controls included. These controls may come in the form of a physical control device or as an emissions limit stipulated by Air District regulation or permit conditions. For example, the Effective Emission Factor in 1990 for N2O was 2.2 lb/MMSCF, however, this same factor in 2022 is around 1.22 lb/MMSCF due to requirements in Regulation 9-6 (BAAQMD, 2023) that progressively lower the nitrogen oxides allowed to be emitted from small-to-medium natural gas commercial water heaters sold in the Bay Area.
To compile the effective emission factor for each year, either the emission factor or control factor is adjusted to account for fleet turnover and/or compliance with the Air District regulation. In this case, the emission factor determined to be applicable in the year 1990 is held constant from 1990 onwards, and the evolving control factor is used to adjust the Effective Emission Factor. It should be noted that a portion of Category 1591 throughput (and by that extension, emissions) are not subject to Regulation 9-6 (e.g. commercial cooking and commercial space heating emissions). Hence a value of 0.38 (see table above; PG&E, 2003) is incorporated as Rule Penetration (RP) factor in the calculation of an effective Control Factor curve for determining the impact of Regulation 9-6.
The 1990 emission factors used for these calculations are presented in the table below:
Emission Factor (lb/MMSCF) | Reference | |
CH4 | 2.26 | EPA 40 CFR Part 98 Subpart C, 2016 |
N2O | 2.2 | EPA AP-42, Chapter 1.4, 1998 (N2O Uncontrolled) |
CO2 | 120,019 | EPA 40 CFR Part 98 Subpart C, 2016 |
Starting in the year 2008, District Regulation 9, Rule 6 started to require small natural gas commercial process heaters and boilers (75,000 Btu/hr and 2,000,000 Btu/hr) to be replaced, upon equipment failure, with low-NOx boilers. In 2031, the same District regulation requires replacement of failed equipment with zero NOx boilers. The implementation of low-NOx boilers is only estimated to have a direct effect on N2O emissions, whereas the requirement of zero NOx boilers affects all GHG pollutants: CO2, CH4, and N2O. The average lifespan of this equipment is estimated to be around 25 years (BAAQMD, 2007). Taking this lifespan as a fleet turnover rate and coupling it with the emission factors for low-NOx boilers in the late 1990s (USEPA, 1998) and early 2000s (USEPA, 2016), allows for the determination of a control factor for all years between 1990 and 2050.
Historical Backcast
For historical backcast of natural gas throughput, the CEC natural gas usage by county for the Commercial sector from 1990 to 2011 is used to produce a backcast profile. This profile is normalized to the year 2011 and applied to the year 2011 throughput obtained from the latest CEC publication (CEC, 2023a; CEC, 2023b) to determine throughput for years 1990-2011. As explained above, an effective emission factor was then applied from 1990-2011 to estimate emissions for N2O, CO2, and CH4.
Future Projections
The CEC publishes an Integrated Energy Policy Report (IERP) every 2 years in which they forecast natural gas usage by an energy provider that accounts for achievable fuel substitution (AAFS) and achievable energy efficiency (AAEE). For all forecasting, a scenario based on a combination of AAFS and AAEE factors that best represents business-as-usual scenario is chosen. Business-as-usual is defined as existing conditions that include impacts from state and federal regulation adopted as of year 2022. To portray business-as-usual forecasting of emissions, the CEC recommends the use of Scenario 3 Programmatic AAFS and AAEE for the Pacific Gas & Electricity (PG&E) regional service area (CEC, 2023c). This forecast does not include the impacts of the following zero-emission appliance standards (ZEAS):
- CARB’s Zero-Emission Appliance Standard: as of this publication of the inventory, this standard has not been finalized
- Air District Regulation 9, Rule 6 (BAAQMD, 2023a), whose future impact is already included in the applicable control curve.
Reductions under Air District Regulation 9, Rule 6 are accounted for only once as a part of the control factor thereby eliminating any double counting errors in the forecast by relying on CEC data which does not include Air District rules in its projections. The use of this projection curve also avoids the inclusion of non-enforceable goals set by CARB.
Sample Calculations
An example calculation is provided below to estimate N2O emissions in San Francisco County for year 2022 for the area source category 1591:
Step 1 | Convert 2019 natural gas usage for Non-Residential sector, obtained from the CEC for San Francisco County, from MMTherms (million therms) to MMSCF (million standard cubic feet) | 96.48 MMTherms × 100,000 MMBtu/MMTherms ÷ 0.001026 MMBtu/scf × 1E-06 MMSCF/scf = 9,404 MMSCF |
Step 2 | Estimate the amount of non-residential natural gas used in the Commercial sector for San Francisco using commercial usage percentage | 9,404 MMSCF × 0.9678 = 9,101 MMSCF |
Step 3 | Gather 2019 natural gas usage data from permitted/registered sources located in San Francisco County in the Commercial sector in MMSCF (category 307_com) | 5,056 MMSCF |
Step 4 | Derive 2019 natural gas usage for area sources in the Commercial sector by subtracting 2019 natural gas usage activity data for category 307_com | 9,101 – 5,056 = 4,045 MMSCF |
Step 5 | Account for loss of natural gas through leakage | 4,045 MMSCF × (1-0.0028) = 4,034 MMSCF |
Step 6 | Grow the natural gas emissions from 2019 to 2022 using growth projections from ABAG Plan Bay Area 2050 datasets | 4,034 MMSCF × 0.888 = 3,582 MMSCF |
Step 7 | Convert the natural gas emissions from MMSCF to lbs and apply 1990 effective emission factor to account for the reduction in emissions for 2022 of 15% based on Regulation 9-6 control curve | 3,582 MMSCF × 2.2 lb/MMSCF × (1-0.15) = 6,698 lbs |
Step 8 | Convert emissions to million metric tons of CO2 equivalents (MMTCO2eq/year) by applying the GWP of 298 for N2O | 6,698 lbs × 1 ton/2000 lbs × 0.907185 tonne/ton × 298 ÷ 1E06 tonne/MMT = 9.06 X 10-4 MMTCO2eq |
Assessment of Methodology
The general methodology for determining emissions in category 1591 has not changed. However, the determination of natural gas throughput allocated to the category has been significantly improved upon by the inclusion of post-meter leakage and a refined sector split of commercial area and point source contributions that greatly improves the accuracy of the resulting emissions.
Base Year | Revision | Reference |
2022 |
|
|
2015 |
|
|
Emissions
The table below summarizes greenhouse gas emissions for the base year 2022 in metric tons of CO2 equivalents (MTCO2eq).
| ID | Description | CH4 | CO2 | N2O | Total |
|---|---|---|---|---|---|
| 1591 | Natural Gas (area source) - Commercial | 1218.5 | 1903332.1 | 5788.1 | 1910338.7 |
| 307_com | Natural Gas | 616.9 | 1091254.6 | 2445.2 | 1094316.7 |
Summary of Base Year 2022 Emissions
Combined, category 1591 and 307_com make up ~25% of the Commercial and Residential sector GHG emissions, and almost 5% of the regional GHG emissions inventory for the year 2022, as shown below. It is outranked as the top contributor to the sector based solely on the emissions from Residential Natural Gas combustion. The main GHG pollutant of concern for these categories is CO2 with N2O and CH4 contributing negligible amounts of MTCO2eq in comparison. GHG emissions from category 1591, and those from Residential Natural Gas Combustion, are expected to decline as a co-benefit from CAP reduction measures in Air District’s Regulation 9, Rules 4 and 6.
Contribution of Commercial Combustion - Natural Gas Emissions by Sector| Subsector | Sector | Subsector GHG Emissions (MMTCO2eq) | Sector GHG Emissions (MMTCO2eq) | % of Sector |
|---|---|---|---|---|
| Commercial Combustion - Natural Gas | Commercial + Residential | 3.00 | 12.85 | 23.39% |
Contribution of Commercial Combustion - Natural Gas Emissions to Regional Total
| Subsector | Subsector GHG Emissions (MMTCO2eq) | Regional Total GHG Emissions (MMTCO2eq) | % of Regional Total |
|---|---|---|---|
| Commercial Combustion - Natural Gas | 3.00 | 65.68 | 4.57% |
Trends
The time series chart below shows the emission trends for categories 1591 and 307_com.
Summary of Trends
Although these categories are evenly distributed in the base years noted above, both the historical emissions and projected growth of each category differ. From 1990 to 2022, emissions associated with area sources under category 1591 declined compared to increased emissions in the point sources under category 307_com. Overall, category 307_com shows increased natural gas usage from permitted industrial and commercial facilities since 2014 due to implementation of the Air District’s registration program for small commercial boilers (Regulation 9-7). Since 2011, all facilities operating a boiler, steam generator or process heater with rated heat input greater than 2 and less than 10 million BTU/hr are required to be registered by the Air District. As more facilities comply with the regulation and report their throughput information, a greater percentage of the commercial boiler population in the Bay Area will be captured by the Air District’s registration program decreasing the overall inventory for the area source category proportional to the increased number of registered sources.
Emissions from both categories remain steady until 2030. The year 2030 marks the first compliance year of Regulation 9, Rule 6, which requires newly installed boilers below 2 MMBtu/hr to be zero-NOx boilers. Currently, the only boilers that comply with this requirement are electric boilers which do not result in any direct emissions of greenhouse gases.
Uncertainties
As the definition of the term ‘Commercial’ may vary slightly depending on the base data set used to derive emissions, there is the possibility that emissions accounted for in these categories and those estimated as a part of natural gas combustion in the Industrial sector have a slight overlap. This overlap is not estimated to be significant but can be refined in the future by obtaining the exact method by which the CEC has distributed emissions into the various economic sectors and by comparing this how the Air District distributes emissions. In addition, the natural gas usage for those boilers registered with the Air District is not reported by the facility operator annually and therefore, may be outdated or not representative of actual usage rates. This may result in emissions from category 307_com being over- or under-estimated. Also, the Commercial sector end-use breakdown is based on an outdated report (PG&E, 2003) and needs to be updated using recent, region-specific measurements and/or surveys.
A final source of uncertainty lies in the treatment of ethane traces found in natural gas. Based on regional natural gas composition data (CEC, 2020b), the minor proportion of ethane (<5%) found in natural gas is assumed to have similar hydrocarbon and volatility characteristics as the methane present in natural gas (~93.5% or higher), and treated as methane for emissions estimation purposes. This may lead to a methane emissions estimate which is conservative but well within the uncertainty of the estimation method and the natural variation in natural gas composition found in collected samples.
Contact
Author: Ariana Husain
Reviewer: Abhinav Guha
Last Update: 07/16/2025
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