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BIOGAS/RNG
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Market momentum, potential and policy were some of the main discussion topics at the virtual Biogas Americas conference. BY ANNA SIMET
The American Biogas Council’s interactive mapping tool tracks U.S. biogas and RNG projects, allowing users to filter by technology type, feedstock, operational status and state.
SOURCE: AMERICAN BIOGAS COUNCIL
With 2,200-plus operating systems in all 50 states, the U.S. biogas market seems sizeable. According to the American Biogas Council’s tally, it currently consists of roughly 273 on-farm systems, 1,269 wastewater systems, 66 food scrap systems and 645 landfill systems. ABC Executive Director Patrick Serfass provided a snapshot of the industry during the Biogas Americas conference introduction, emphasizing the industry’s vast potential, which is not only based on the estimate that there is potential for more than 15,000 more systems among all categories, but renewable natural gas (RNG) upgrading possibilities of existing electricity facilities as well. “178 of the operating projects are RNG,” he said. “It’s interesting to look at how many [RNG] projects we have this year—the number is changing by the day and increasing very quickly. There are electricity-generating projects across the country and many are being upgraded, but there are a lot of new projects as well.”
Serfass’s industry overview was a fitting segue into a conversation with Brightmark CEO Bob Powell, a former director of ABC, who discussed the company’s tremendous momentum in the bio-
Serfass
Powell gas space, as well as insights on project development, partnerships and how the industry should, in a united fashion, move forward. “Ultimately, our mission is to reimagine waste,” Powell said. “We’re trying to find solutions to our most fundamental environmental issues caused by waste.” Powell discussed Brightmark’s current work in plastic recycling, which is centered on a technology that he said was invented and patented nearly 20 years ago. From numbers 1 to 7 plastics to Styrofoam containers, Powell said the pyrolysis-based platform can convert materials back into useable products, including transportation fuels, motor oils, paraffin waxes and more. Currently, Brightmark has a 100,000-ton-per-year (TYP) facility in Ashley, Indiana, and plans to build more in the future, Powell said. This includes a 400,000 TPY plant under development in Macon, Georgia, in partnership with the state, as well as projects in Europe in partnership with BP, with which the company recently signed an MOU. Moving on to the topic of RNG, Powell said the company has projects under construction from coast to coast of the U.S., a combination of new builds and upgrades of existing power projects. Operating projects, aside from a poultry litter-to-combined-heat-
US Biogas Market
Current
2,200+ Operational biogas systems 15,000+ Potential new biogas systems
and-power project in Sumter, South Carolina, are all dairy manure, Powell said, which are on-farm or in farming communities. “We recently announcing the closing of our third set of projects in a joint venture with Chevron,” Powell said. “Beginning last year, with Chevron, we agreed to jointly construct, develop, own and then sell RNG projects across the U.S. Last November, we closed our first tranche, earlier this year we closed our second, and very recently, we announced the closing of our third.”
Brightmark and Chevron are in the process of completing construction of the three different groups of projects, Powell added, which total 28.
When asked what has had the most significant impact on growth, Powell was quick to answer. “The people and the team,” he said. “When we started from ground zero five years ago, we had two to three people, and now we have over 100 strong. “What I wanted at founding was to create a mission-oriented company that was looking to solve a problem that didn’t yet have a solution … Without the mission, [Brightmark employees] wouldn’t have joined the team. We’re talking experts in every area ... engineers who had not worked on digester projects before but are really good at it, a financing team that is very passionate but could have done a lot of other things and been compensated very differently as we started the company ... we assembled a team that has done things like this in other areas and is excited to achieve the mission.”
Outside of Brightmark, Powell said, the industry needs to focus on growing its collective team, meaning attracting people who are not already in the space. “We need a ton of new people to get this done,” he said, in regard to market growth and the substantial increase of RNG use. “Most [people] we need to get from outside, and we need to figure out how to train and educate them, and create processes for them to be successful. As we look at gaining workforce, I am very cognizant that if I were to get someone from another company simi-
lar to us, I’m pulling from the same smaller, finite resource.”
The challenge in this, Powell reiterated, is having training framework in place for new people. He pointed to the American Biogas Council’s educational programs, which he said “are really awesome, in fact, a lot of our folks attended the operator trainings early on, and they were very valuable.”
Finally, when asked about partnering with larger players like Brightmark has, Powell emphasized how critical it is to have a long-term—and backup—plan. “When you’re participating with larger players, in my history in the renewable sector, there may be big surprises if you haven’t played the chess pieces,” he said. “You need a plan to exit in some cases, and to know what your long-term economic sustainability is ... having a strategy where you simply undercut your competitors, without thinking about the chess moves, can really poison the well for us, and limit all of our abilities to successfully solve the GHG, land management and the water quality issues we have. You really need to have an end game and be thoughtful, but don’t be fearful of partnering with others.”
RNG on the Horizon
The RNG market forecast panel was also led by Serfass, who initiated the conversation by asking participants which segment of the RNG industry they would choose if they had to put all their investment dollars for the next two years into one basket.
Lauran Turner, vice president of renewable partnerships at Archaea Energy, pointed to partnering with downstream users of RNG—corporations, universities and utilities, to sell to under longterm, fixed-price agreements. “I’m really excited about the growth of the voluntary market,” she said, adding that she believes this will lead to growth of the compliance market as well. “Net zero and emissions reduction targets, large corporations and utilities, they are finally jumping in and learning about RNG, and how it can be used to decarbonize so many applications within their organizations.”
As for Sean Wine, vice president of renewable operations at Clean Energy Renewable Fuels, he said he couldn’t pick one particular industry facet, but rather, “Anything that is low carbon intensity (CI) … I think the transportation space commands the highest value today. It will continue to drive a lot of this and a lot of the feedstock development … the low CI markets are going to influence carbon reduction goals in various state programs currently being developed.”
John Dannan, managing director of Generate Capital, said his choice would be projects that obtain ultra-low CI scores. “I think that’s a really big differentiator in projects and their access to markets … profitability is driven by the scores they get. Poultry and swine have the chance of getting amazing scores.”
Dannan emphasized the potential of food waste projects at landfills. “CARB (California Air Resources Board) is trying to incentivize food waste at landfills and give them ultra-low CI scores, which normal food waste standalones don’t get,” he said, adding that two projects under construction in California both received scores between minus 150 and 200. “Regular ones usually get 0 to 50, or minus 20 to 40,” he said “Basically, CARB gave them credit for no extra trucking, because the trucks are already going there.”
Paul Niznik, Argus senior biofuels consultant, said in the interest of diversifying the conversation, another appealing option might be some low CI projects that don’t necessarily go into the transportation fuel
Top: Patrick Serfass, John Dannan, Lauran Turner; bottom: Paul Niznik, Sean Wine
PHOTO: RNG
market. “I might be interested in the development of swine effluent, low-capex biogas capture,” he said. “If there was a site with an open pond or lagoon, we might look at some retro-style electricity production that can also enter into some of these low CI markets … they get a lot of upcharge, extra credit generation through specifics of the rules. I would like to have that optionality if I had all my chips in one basket—not only to have the option of cleaning up the gas and getting it into the pipeline if convenient, but also go back to power generation.” Low- and ultra-low CI projects continued to be a topic of conversation. Turner discussed the potential of landfills and the fact that there are still many without gas collection systems, adding that her company is a proponent of sliding-scale CI scores. “We’re looking at all strategies to reduce CI, whether that’s incorporating onsite solar for electricity needs, or incorporating carbon capture and sequestration,” she said. “We have a team of geologists and we’re working with the EPA to permit projects that make sense to capture CO2 from the landfills and put it back in the ground. So that’s going to lower the CI.”
As for other types of untapped or underutilized resources, Dannan said poultry litter is a more difficult feedstock to gather, manage and digest from a physical perspective, but it’s also tougher to acquire from a business model perspective. “That’s why it hasn’t taken off so much.”
Wine agreed, adding that swine projects also pose challenges. “What’s nice for dairy is that it’s a pretty steady cycle—they eat feed, manure is produced and then it goes into the capturing system ... it’s more of a seamless process and easier to manage than poultry and hog facilities. Hogs don’t produce as much—there is a lot more hog, but a lot less gas production. A cow does about 120, 150 gallons of RNG a year, and a hog is significantly lower than that, with generally lower volatile solids.”
One of the final questions panelists were asked is about the possibility of a standard way of measuring CI outside of California’s Low Carbon Fuel Standard considering other states are working to develop programs, whether it will be a gener-
ic measurement, and how it could impact the voluntary market. “Unfortunately, it is [currently] a very diversified market in terms of modeling,” said Niznik. He pointed to Canada’s CI programming model, and how it elected to implement a different accounting system than that of states like California or Oregon, and even different than British Columbia’s. “It does seem to be one of the problems, but it can be overcome …it is hard to get people to agree.”
Turner agreed that it would be a good thing to adopt an industry standard, but reiterated how difficult it could be. “We have to remember the Greek calculator is a well-to-wheel analysis for transportation fuels, so when it goes into other uses like RNG for heat or as feedstock for other types of products, that calculation changes,” she said. “But can we get to something that is covering all those different uses? I think we can, we’ve got lots of smart people in this industry working toward it, and everyone is moving toward carbon accounting. And with that, you need to measure it, have your data and know what it says, how it impacts your emissions and total CI ... there are a lot of different ways to model it.”
Wine had a slightly different view, stating that he believes standardization won’t drive the market at this point. “We need regulatory programs to be adopted in other states,” he said. “The standardization will come, but it’s a long view to get there … In the grand scheme of things, as an industry we need to develop more programs and regulatory framework outside of just California. Washington has got theirs, but we need New York to be successful with getting that adopted for next year, and we need the other states like Minnesota and New Mexico—there are probably eight states currently looking at adopting something in next 24 to 36 months—to do more of that, which will help continue to drive project development.”
Author: Anna Simet Editor, Biomass Magazine 701-738-4961 asimet@bbiinternational.com
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