Combined, the three dairies expect to generate about 350,000 MMBTU biogas per year for sale to off-takers or use by the company’s affiliate, Agri-Energy, LLC, at its biofuel production facility in Luverne, Minnesota, according to a statement.
Gevo said its mission is to reduce and eliminate the fossil footprint caused by running the Luverne facility. The biogas contracts, in conjunction with wind power, should enable any biofuel produced at the Luverne facility to have a lower carbon intensity score as well as an increased value.
The company said it has a letter of commitment from a lender for $20 million to finance the renewable natural gas project at one of the three dairies.
In addition, the company also has a verbal commitment from the same lender to finance the renewable natural gas projects at the other two dairies. The financing includes capital for the anaerobic digesters, the biogas collection and upgrading system, as well as the utility interconnection system.
"These three dairy farms represent what I envisioned as Phase 1 of the biogas cluster consisting of 8-10 total farms once the system is fully built out," said CEO Patrick Gruber.
"We aim to change mindsets by demonstrating you can change waste from being a pollution problem to a renewable energy solution in the liquid fuels market."
Gevo, based in Englewood, Colorado, is commercializing the next generation of gasoline, jet fuel and diesel fuel with the potential to achieve zero carbon emissions, addressing the market need to reduce greenhouse gas emissions with sustainable alternatives.
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