Natural gas distributed energy is recognized as a pivotal means to enhance energy efficiency and mitigate carbon dioxide emissions through localized energy cascading. Positioned as a key option for advancing the Sustainable Development Goals, this system optimizes energy utilization near end-users. While maximizing energy efficiency, it is imperative to address potential environmental challenges. A thorough, comprehensive environmental assessment, facilitated by the life cycle assessment method, proves instrumental in meeting this standard. Employing this method enables an intuitive grasp of the environmental strengths and weaknesses inherent in natural gas distributed energy within the power structure. This insight serves as a foundation for informed project decision-making, fostering the growth of the industry. We selected six environmental impact assessment categories based on the CML 2001 method, and conducted the life cycle analysis across four stages. China's inaugural natural gas distributed energy demonstration project was chosen as a model case, and an environmental impact assessment inventory was established, utilizing survey data and literature for comprehensive data collection and analysis. Results from case testing yield environmental impact assessment outcomes, with a specific sensitivity analysis for stages with notable environmental impact factors. The study underscores that the operation phase has the highest environmental impact, comprising 78.37% of the total combined environmental impact, followed by the fuel production phase. Comparative analyses with coal-fired and conventional natural gas power generation, based on dimensionless literature data, reveal that abiotic resources depletion potential is the primary contributor to the environmental impact of 1 kWh of electricity product, constituting 52.76% of the total impact value, followed by global warming potential. Concrete strategies have been outlined for decision-making in both the operational and planning phases of natural gas distributed energy projects. The strengthening of policies is pinpointed towards grid connection and scale expansion.
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