French multi-energy group TotalEnergies SE has signed an agreement to form a 50/50 joint venture with US renewable natural gas producer Vanguard Renewables and develop, build and operate “farm powered” RNG projects in the United States.
A joint announcement on Wednesday said that the JV will initially focus on ten projects with a total annual RNG capacity of 0.8 TWh, sourcing waste from the food and beverage industries and dairy manure from farms. The first three covered by the agreement are currently under construction in the US states of Wisconsin and Virginia, each capable of delivering close to 75 GWh of RNG per year.
Beyond the initial ten projects, the partners might invest in an additional 60 projects for a total capacity of 5 TWh per year, they said.
Vanguard Renewables, a portfolio company of a fund managed by BlackRock Real Assets since July 2022, produces RNG from agricultural and organic waste utilising the so-called Farm Powered anaerobic co-digestion process. It currently has 17 facilities in operation.
As part of the JV, Vanguard will contribute its ready-to-build projects, manage feedstock supply, assets, operations and RNG sales, leveraging its network of food industry brands and the Farm Powered Strategic Alliance for waste materials.
“This collaboration validates Vanguard’s leadership position in the RNG space in the U.S. and brings together our expertise with TotalEnergies’ extensive experience in large-scale energy development, safety procedures, and global partnerships. These 10 RNG projects, jointly undertaken by TotalEnergies and Vanguard Renewables as co-investment partners, further reinforce our commitment and ability to deliver on our mission of harnessing the power of waste to decarbonize our planet,” said Neil H. Smith, CEO of Vanguard Renewables.
TotalEnergies will also provide technical support on on design, engineering, and plant operations of the RNG facilities.
The partners will jointly market the RNG, selling it through long-term purchase agreements with companies seeking to decarbonise their processes.
“This joint venture is a new step for TotalEnergies in achieving its objective to produce 10 TWh of renewable natural gas by 2030,” commented Olivier Guerrini, Vice President, Biogas at TotalEnergies.
The JV transaction will be finalised once all customary conditions are met. (April 25, 2024)
UNITED STATES - BIOMETHANE - Production