UGI commits funding for renewable natural gas project

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Wyomissing-based UGI Energy Services (UGIES) announced Monday it had entered into an agreement with MBL Bioenergy to fully fund the first set of renewable natural gas projects in South Dakota.

The project, representing more than $70 million in investments by MBL Bioenergy, is a joint venture between UGIES, Sevena Bioenergy, and a subsidiary of California Bioenergy (CalBio) to develop RNG projects in South Dakota. UGIES will provide 100 percent of the funds for MBL Bioenergy.

“This project sets a new standard for UGI in terms of scope and size and represents a huge milestone in UGI’s investments in, and expected earnings contribution from, RNG projects,” said Robert F. Beard, Executive Vice President – Natural Gas, Global Engineering, Construction & Procurement, UGI. “We are pleased to be partnering with industry-leading developers on this project that will substantially reduce greenhouse gas emissions, using dairy RNG as a vehicle fuel. We look forward to making additional investments in our MBL partnership as we advance the use of RNG as an environmentally responsible and clean energy solution.”

The first set of projects, or cluster, will be built at three farms located north of Sioux Falls, S.D., and will generate an estimated 300 million cubic feet of RNG annually starting in 2024. Dairy waste from the farms will be anaerobically digested and then piped into an upgrading facility before being delivered into the interstate natural gas system near Dell Rapids, S.D. UGIES will be the exclusive marketer for MBL Bioenergy through its wholly-owned subsidiary, GHI Energy.