Anaergia's SoCal Biomethane Plant Starts Gas Deliveries Under SB 1440

Anaergia Inc. (TSX: ANRG; OTCQX: ANRGF) started sending renewable natural gas into Southwest Gas Corporation's distribution system this week. The Victorville, California facility is the first in the state to deliver RNG under California's Biomethane Procurement Program, the company said Thursday.

The project got conditional approval from the California Public Utilities Commission on March 19 and began deliveries after meeting the CPUC's conditions. The milestone shows SB 1440 can support commercial-scale RNG projects that pass utility safety and quality checks, CEO Assaf Onn said.

"As the first facility to deliver renewable natural gas under California's Biomethane Procurement Program, the SoCal Biomethane facility proves that organic waste can be transformed into a reliable and renewable fuel source at scale," Onn said. "By integrating with existing wastewater infrastructure, we are delivering immediate value to customers while establishing a replicable blueprint for communities across the state."

The plant sits at the Victor Valley Wastewater Reclamation Authority site. It co-digests municipal wastewater solids and diverted organic waste from across Southern California, upgrading the biogas to pipeline-quality RNG that meets Southwest Gas' California tariff. The facility can process up to 104,000 tons of organic waste a year and could cut greenhouse gas emissions by as much as 31,710 metric tons of CO2-equivalent annually.

"This agreement marks an important step in Southwest Gas' efforts to responsibly integrate RNG into our supply portfolio," said Justin Brown, President and CEO of Southwest Gas. "Projects like this show what's possible, delivering tangible environmental benefits for our communities while supporting the energy needs of our customers."

Anaergia worked with Anew Climate, which markets the RNG from the facility and handles utility offtake, carbon intensity compliance, and physical delivery and scheduling as a Core Transport Agent in California. Anew is majority owned by TPG Rise, TPG's global impact investing platform. TPG Inc. (TPG) carries an Alpha Score of 53/100, rated Mixed.

"We're pleased to support this project as it moves into active delivery under SB 1440," said Andy Brosnan, President of Low Carbon Fuels at Anew Climate. "This work reflects the coordination required across industry and regulators to bring renewable natural gas projects online, and the experience gained here will help inform future development across California and in other regions pursuing methane reduction, grid reliability, and expanded renewable energy supply."

SB 1440 requires investor-owned utilities in California to buy RNG made from organic waste that would otherwise go to landfill. Statewide targets suggest many similar facilities will be needed by 2035. The SoCal Biomethane project's shift to active delivery gives other developers an operational and regulatory template to follow.

Anaergia holds hundreds of patents for converting organic waste into RNG, fertilizer, and water. The company designs, builds, and operates facilities, and runs RNG plants it owns, that third parties own, or that are joint ventures.