Wyomissing, Pa.-based UGI Corporation announced Wednesday that its joint partnership, MBL Bioenergy, would be investing approximately $150 million in dairy manure waste to renewable natural gas (RNG) projects in South Dakota.
UGI Energy Services, LLC will provide the funds for projects. (UGIES), a subsidiary of UGI. MBL Bioenergy is a partnership between UGIES, Sevana Bioenergy, and a subsidiary of California Bioenergy (CalBio) with the sole purpose of developing RNG projects in South Dakota.
The money will fund two new dairy cluster RNG projects expected to generate approximately 525 million cubic feet of RNG annually once they are completed in 2024.
“This project sets a new standard for UGI in terms of scope and size and represents a key milestone in UGI’s investments in RNG projects,” said Robert F. Beard, Chief Operations Officer, 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. In May of 2022, UGI committed over $70 million of investment to fund the Moody cluster of three dairies. The Moody cluster is now well into construction and anticipated to be online in late 2023. 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 second cluster project, Brookings, will be built near Esteline, S. D., and is expected to generate approximately 300 million cubic feet of RNG annually. Dairy waste from three nearby farms will be anaerobically digested to produce biogas. This will then be piped to a gas upgrading facility before being delivered into the local natural gas distribution system. The third cluster project, Lakeside, will be built near Summit, S.D., and is expected to generate 225 million cubic feet of RNG annually.
“This expansion of our partnership with UGI is another important step forward in expanding our carbon-negative renewable natural gas business,” said N. Ross Buckenham, CEO of CalBio. “Our dairy methane capture and refining projects are delivering significant environmental benefits, improving economics for dairy farm partners, and supplying a clean-burning diesel replacement fuel.”