Gevo secures biogas supply and receives commitment letter for financing
In the United States (US), biomass conversion process developers and renewable fuel producers Gevo Inc., has announced that it has contracted with three dairies to provide manure that Gevo will convert into pipeline quality biogas – Renewable Natural Gas (RNG). Combined, these three dairies expect to generate approximately 350 000 MMBTU biogas per year for sale to off-takers or use by Gevo’s affiliate, Agri-Energy, LLC, at its biorefinery located in Luverne, Minnesota (MN).
According to Gevo, the quest of the company is to reduce and eliminate the fossil footprint caused by running the Luverne facility. These biogas contracts, in conjunction with wind power, should enable any biofuel produced at the Luverne facility to have a lower carbon intensity score as well as an increased value.
Currently, the company has a “letter of commitment” from a lender in the amount of US$20 million for financing the Renewable Natural Gas project at one of the three dairies. In addition, Gevo also has a “verbal commitment” from the same lender to finance the Renewable Natural Gas projects at the other two dairies.
The financing includes capital for the anaerobic digesters (AD), the biogas collection and upgrading system, as well as the utility interconnection system.
These three dairy farms represent what I envisioned as Phase 1 of the biogas cluster consisting of 8-10 total farms once the system is fully built out. We aim to change mindsets by demonstrating you can change waste from being a pollution problem to a renewable energy solution in the liquid fuels market, said Dr Patrick R. Gruber, CEO of Gevo.