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TPG Rise Climate joins RNG joint venture with investment

In the United States (US), TPG Rise Climate, the dedicated climate investing strategy of TPG's global impact investing platform TPG Rise has announced that it is investing in a renewable natural gas (RNG) joint venture to further develop, implement, and expand next-generation RNG technologies to curb methane emissions.

TPG Rise Climate is investing in Monarch BioEnergy LLC, a renewable natural gas (RNG) joint venture between Roeslein Alternative Energy LLC (RAE), and a subsidiary of Smithfield Foods, Inc. to further develop, implement, and expand next-generation RNG technologies to curb methane emissions (photo courtesy RAE).

Accelerating the transition to renewable energy, greening the industrial sector, and scaling greenhouse gas (GHG) abating technologies are core pillars in TPG Rise Climate’s multi-sector investing strategy.

TPG Rise Climate is investing an undisclosed amount in Monarch BioEnergy LLC (Monarch), a joint venture between Roeslein Alternative Energy LLC (RAE), and a subsidiary of Smithfield Foods, Inc.

Kirkland & Ellis is serving as legal advisor to TPG Rise Climate. Hunton Andrews Kurth is serving as legal advisor to Smithfield.

An equal partner in Monarch

Launched in 2018, Monarch leverages RAE’s state-of-the-art technology and Smithfield’s innovative sustainable farming practices to capture methane emissions and convert them into carbon-negative renewable natural gas (RNG) to power homes, vehicles and businesses. Chris Roach, President of RAE, will serve as Monarch’s CEO, a newly created role.

As an equal partner in the JV, TPG Rise Climate will work with RAE and Smithfield to advance agricultural innovation, enhance existing projects in Missouri (MO), and develop new ones in select states across the United States.

For years, Rudi Roeslein and his eponymous company RAE have been developing proven, market-based solutions to demands for both sustainable agriculture and renewable energy. Applying RAE’s anaerobic digester technology, as well as additional circular technologies and environmental protections, to Smithfield’s hog farms is a significant and meaningful step towards addressing methane emissions at their source. Advancing and scaling proven GHG abating technologies like those used by Monarch is central to our mission at TPG Rise Climate, and we look forward to working with RAE and Smithfield to advance and drive operational best practices for these emerging technologies, said Marc Mezvinsky, Business Unit Partner in TPG Rise.

Monarch’s technology and proprietary process are key to creating closed-loop, zero-waste systems on large farms. Its anaerobic digester (AD) infrastructure captures methane emissions from manure and converts those emissions into pipeline-quality RNG, which is distributed to RNG markets across the country.

The type of biogas created by Monarch’s process has consistently received the lowest Low Carbon Fuel Standard (LCFS) carbon intensity (CI) scores, reducing GHG emissions and providing air quality health benefits by reducing surface ozone.

Additionally, the byproducts of Monarch’s anaerobic digestion are feedstock for other important farm-related circular uses including fertilizer, irrigation, and soil regeneration.

Monarch is taking an innovative approach to tackling methane emissions – one of the most complex challenges we face in the fight against climate change. With additional capital and expertise from TPG Rise Climate, Monarch will continue to advance RAE’s technology and commercialize its adoption to large and small agricultural operations across the country, said Chris Roach, newly appointed CEO of Monarch.

Seeking partnerships

The JV is also actively seeking partnerships that would leverage emerging technological solutions to turn effluent waste from the digester process into organic fertilizer, clean water, and compostable fiber. In connection with its mission, Monarch will also explore becoming a Certified B Corporation.

As part of Smithfield’s commitment to becoming carbon negative across its US company-owned operations by 2030, the company established Smithfield Renewables in 2017 to unify its GHG-reduction efforts with a focus on emissions reduction and efficiency efforts on farms, processing facilities, and across its transportation and logistics network.

We are excited to integrate TPG Rise Climate’s rigorous impact and operational capabilities into Monarch. TPG Rise Climate’s mission to scale emerging climate solutions that result in quantifiable greenhouse gas avoidance is consistent with our commitment to lead in agricultural innovation and sustainability, said Kraig Westerbeek, VP of Smithfield Renewables.

Land restoration

As part of RAE’s goal to restore 30 million acres of land to native prairie plants strategically located around waterways, streams, rivers, and highly erodible lands, Monarch and RAE have already planted several thousand acres of prairie grass, providing ecological services and wildlife habitat for monarch butterflies across Missouri (MO).

The partnership is actively exploring ways to expand this initiative to other Monarch projects.

We continue to see Monarch as a blueprint for how to address environmental challenges with fully integrated, closed-loop innovations. With investments in technology and innovation, farming, both large and small, can be a keystone in the circular economy. Not only do Smithfield’s operations create a natural feedstock for low carbon or carbon-negative natural gas, but it also gives us an opportunity to begin to sustainably replant and harvest prairie grasses that naturally sequester carbon, store and filter water, and create biomass for the production of additional RNG, said RAE Chairman and CEO Rudi Roeslein.

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