Renewable Natural Gas and the Promise of a Cleaner Future

Title: Renewable Natural Gas and the Promise of a Cleaner Future
Speakers: Russell Kooistra and Daniel Archuleta

Russell Kooistra (00:07):
Hey, Daniel, how’s it going?

Daniel Archuleta (00:08):
Good. How are you, Russell?

Russell Kooistra (00:10):
I’m great. Are you working on anything interesting these days?

Daniel Archuleta (00:12):
So one thing that’s increasing in terms of the day-to-day work I’m doing for utility clients is RNG or renewable natural gas projects.

Russell Kooistra (00:21):
Tell me about RNG.

Daniel Archuleta (00:23):
So maybe we start with a general definition. RNG or renewable natural gas is pipeline quality gas that comes from the decomposition of organic waste, and can be used interchangeably with traditional natural gas. Now, because it comes from organic waste, it can also be referred to as sustainable natural gas or biomethane.

Russell Kooistra (00:46):
You mentioned it comes from organic waste. What does that mean exactly? What are some of the sources of RNG?

Daniel Archuleta (00:51):
Good question. So technically, it could be sourced from anything that decomposes over time in a process known as anaerobic digestion. But the four main sources at this point in time of RNG are landfills, livestock farms, wastewater treatment sites, and food waste.

Russell Kooistra (01:09):
So what are some of the benefits of RNG?

Daniel Archuleta (01:11):
Well, the environmental benefits in particular of RNG are significant. As organic waste decomposes, it will naturally give off various gases, including methane. RNG, however, and RNG projects are able to capture these gases so that they don’t escape out into the atmosphere, thus reducing greenhouse gas emissions. And in the process, they’re able to use what is otherwise interchangeable natural gas and traditional natural gas to meet our current and future energy needs.

Russell Kooistra (01:42):
So why has RNG production grown so much recently?

Daniel Archuleta (01:45):
The underlying technology for RNG has been around for a very long time and has actually been used for several decades. Nevertheless, there are two things that are increasing RNG production and interest in a very significant way. First, various federal tax credits and renewable energy credits are incentivizing these projects from a financial point of view, and the environmental benefits and attributes associated with RNG production are incentivizing these projects from a policy perspective.

Russell Kooistra (02:16):
What does this increase in product development mean for utility companies in particular?

Daniel Archuleta (02:21):
So over time, and in the last couple years in particular, we have seen that our utility clients not only wanna help play a part in developing these RNG projects, but also want to look to incorporate the underlying RNG pipeline facilities into their existing utility systems. Doing so allows them to accomplish both internal goals and policies that they have set out for themselves as well as meet various local and state regulatory requirements in terms of reducing their greenhouse gas emissions.

Russell Kooistra (02:55):
You mentioned regulatory requirements. What are some of the key regulatory considerations that utility companies must keep in mind for an RNG project?

Daniel Archuleta (03:03):
Well, from a regulatory perspective specifically, a couple things that we always want to raise with our clients include the underlying financing, renewable credits, or various tax incentives that the parties are seeking to utilize and therefore finance a project. Depending on what is being utilized and how it’s being utilized, those can have significant regulatory implications. Second, we always wanna make sure our utility clients are aware of the specific gas quality standards that are gonna apply to the resulting RNG. Depending on the size, location and intended end use associated with any RNG project, the gas quality specifications that apply and the underlying analysis will vary greatly. And then third, for all of our utility clients, as they get more and more active in this space and look to incorporate RNG facilities into their existing systems, the jurisdictional analysis and questions that result are equally as important. We wanna make sure that our utility clients are fully aware of any new or expanding regulatory requirements and rules they might face as a result of these RNG projects.

Russell Kooistra (04:16):
Well, natural gas continues to play an important role in the US energy mix. It sounds like RNG can help utilities serve both local demand while meeting environmental goals. I look forward personally to helping clients navigate both the financing and regulatory hurdles involved with an RNG project.

Daniel Archuleta (04:33):
I think we all are. Thank you very much for this conversation today and we look forward to working on future projects, not only in the energy space, but for renewable natural gas in particular.

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