Aemetis Biogas LLC – a subsidiary of Cupertino, Calif.-based Aemetis Inc., a renewable fuels and biochemicals company – has closed a $30 million equity investment to build, own and operate dairy biomethane digesters, pipelines and gas cleanup/compression facilities primarily under 20-year agreements with dairy farms in California.
The equity funding was provided by Protair-X Americas, an environmental investment unit of Canada-based Protair-X Technologies, which has extensive experience in protecting livestock farming environments. Aemetis’ senior lender, Third Eye Capital, is a major investor in Protair-X Technologies. The funding was closed without any dilutive stock issuances by Aemetis Inc.
With a carbon intensity under the California Low Carbon Fuel Standard of about -300, dairy biomethane is highly valuable, but it needs to be collected at the dairy, pipelined to a central processing facility, and then cleaned and compressed for use as renewable natural gas in converted diesel trucks and other natural gas vehicles, explains Aemetis.
The project will initially connect about a dozen dairies to Aemetis’ ethanol plant in Keyes, Calif., with expansion plans to more than three dozen dairies in the local area. The Aemetis plant supplies Wet Distillers Grain feed to about 100 dairies.
“Dairy biogas is a below-zero-carbon biofuel that is a new source of revenue for dairies, which do not currently have a way to monetize their biomethane as a transportation fuel without the necessary pipeline and gas cleanup/compression infrastructure, as well as a customer that can use biogas to produce low-carbon biofuels,” says Eric McAfee, chairman and CEO of Aemetis. “Our 60-million-gallon ethanol plant is capable of using biogas to replace petroleum natural gas to produce a lower-carbon biofuel and generate additional Low Carbon Fuel Standard credits.
“Since utilities in California have not yet completed the permitting and other requirements for injection of dairy biomethane into natural gas pipelines, collecting and converting biogas for use in ethanol production provides Aemetis a sustainable first-mover advantage in biogas pipeline and dairy digester construction for dairies in the area around our Keyes plant,” McAfee adds.