Aemetis closes $30M equity investment for biomethane pipelines and dairy digesters to produce below zero carbon renewable natural gas (RNG)
Aemetis subsidiary Aemetis Biogas LLC closed a $30-million equity investment without any dilutive stock issuances by Aemetis, Inc. and funded the first $8.3-million tranche to subsidiary Aemetis Biogas to build, own and operate dairy biomethane digesters, pipelines and gas cleanup/compression facilities primarily under 20-year agreements with dairy farms in California.
Dairies produce about 25% of California’s methane emissions and have become targets of carbon regulations aimed to reduce climate change. With a carbon intensity under the California Low Carbon Fuel Standard of about negative 300, dairy biomethane is highly valuable, but needs to be collected at the dairy, pipelined to a central processing facility, then cleaned and compressed for use as Renewable Natural Gas in converted diesel trucks and other natural gas vehicles.
The project will initially connect about a dozen dairies to Aemetis’ ethanol plant in Keyes, California, 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. 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.—Eric McAfee, Chairman and CEO of Aemetis
The equity funding of Aemetis Biogas was provided by Protair-X Americas, an environmental investment unit of Protair-X Technologies in Canada, which has extensive experience in protecting livestock farming environments. Aemetis’ senior lender, Third Eye Capital, is a major investor in Protair-X Technologies.
Aemetis is an advanced renewable fuels and biochemicals company focused on the acquisition, development and commercialization of innovative technologies that replace traditional petroleum-based products by the conversion of ethanol and biodiesel plants into advanced biorefineries. Founded in 2006, Aemetis owns and operates a 60 million gallon per year ethanol production facility in California’s Central Valley, near Modesto.
Aemetis also owns and operates a 50 million gallon per year renewable chemical and advanced fuel production facility on the East Coast of India producing high quality distilled biodiesel and refined glycerin for customers in India, the US and Europe.
Aemetis operates a research and development laboratory, and holds a portfolio of patents and related technology licenses for the production of renewable fuels and biochemicals.