Missouri hardly produces natural gas unless you count the pigs.
Methane that comes out of dung tanks on pig farms across the state is increasingly channeled into pipelines and delivered to power plants and homes, where it is burned along with shale gas for heating, hot showers and cooking.
Smithfield Foods Inc., the country’s largest pork producer, expects to sell gas from all of its agricultural operations in Missouri by the summer. Most of its farms already feed methane into the gas network. Since the covers are extended by the 4-acre ponds in the rest and then connected to equipment that removes carbon dioxide and gas impurities, Smithfield hopes to supply enough gas in Missouri to supply nearly 10,000 homes.
“For two decades, we have been studying how to produce energy from manure,” said Kraig Westerbeek, who leads Smithfield’s renewable energy business. “We had some flaws, but these projects show that you can really do that.”
Kraig Westerbeek examines a Smithfield farm in northern Missouri.
The rush of companies to associate with the reduction of greenhouse gases is transforming the use of methane that drains from piles of organic waste into a big business. The so-called renewable natural gas can be produced in commercial quantities at pig and dairy farms, landfills, waste water and spoiled food treatment facilities and slaughterhouse sludge.
Burning it to generate electricity or heat does not produce less carbon dioxide than shale gas. But methane is a more potent greenhouse gas than carbon dioxide. Diverting methane from the atmosphere and into the power grid is treated as an emission reduction and rewarded with valuable low carbon and renewable fuel credits, which can be marketed with or separately from gas.
Gas from landfills, farms, sewage stations, food waste and other anaerobic digestion systems make up less than 1% of the United States’ natural gas supply. The market is flooded with so much shale gas that many oil drillers simply burn their once valuable by-product – what they call “garbage gas” – at the wellhead, instead of spending money sending it to the market. On Monday, natural gas futures contracts fell to $ 2.27 per million British thermal units, an insignificant winter price that falls below breakeven for many producers.
Real garbage gas generally costs much more. It cannot compete with shale gas without subsidies such as fuel credits and its beneficial effect on the mathematics of corporate emissions.
Analysts and utility companies believe that renewable natural gas can reach 10% to 30% of the total natural gas supply by 2040. The lower limit of this range will still require the help of policy makers, deep pockets in the energy sector and companies eager to improve their environmental credentials for funds that move trillions of dollars with environmental and social responsibility in mind.
On a Smithfield farm in northern Missouri, puddles of manure are being covered to capture biogas.
Pipeline and utility companies are essential to a biogas boom. Connecting manure tanks to pipelines is very expensive for most farmers, but connecting remote sources of gas to the market is the day-to-day business of energy companies. Unlike grid operators, pipeline owners do not have wind and solar energy to promote ESG investors or to deflect skepticism about the value of pipelines in a green energy economy.
“Renewable natural gas is something green for them to talk about,” said RBC Capital Markets analyst TJ Schultz. “The benefit for them is that it fits into the existing infrastructure. They don’t need to make changes ”.
The RBC estimates that commercial quantities of gas could be produced at more than 2,500 landfills in the United States, the most prolific sources, and about 8,000 farms, which yield the most valuable credits because they are the most potent polluters.
The American Biogas Council struggled to reach public utilities three years ago, said Patrick Serfass, executive director of the defense group. That was before so many companies had promised carbon neutrality and ESG funds had such dominance.
“Now gas utilities are coming to us asking how they can obtain renewable natural gas and help build more systems to make their gas source greener and make their pipelines greener,” said Serfass.
Dominion Energy Inc.,
a large utility company that seeks carbon neutrality by 2050 and plans to invest $ 2 billion in biogas projects. It has a $ 200 million pact to install them on dairy farms and is looking for another $ 500 million with Smithfield separate from the pig producer’s operations in Missouri.
The pipelines take the raw biogas to a processing center on a Smithfield farm.
The partnership’s first project collects gas in the Escalante desert in Utah from 26 pig farms. The gas flows into a pipeline between the Wyoming and Bakersfield, California gas fields. Pigs are expected to heat about 3,000 houses.
Dominion and Smithfield, the latter aiming to eliminate more emissions by 2030 than those produced on their properties in the United States, have other projects planned or underway in Arizona, California, Virginia and North Carolina, where millions of pigs are fattened each year. “Southeast North Carolina has the potential to be one of the main regions for the production of renewable natural gas,” said Ryan Childress, director of gas business development at Dominion.
Energy Alwaysin
SoCalGas, the country’s largest gas concessionaire, is working with dairy farmers and says 20% of its gas will come from waste by 2030. California regulators recently said the Los Angeles concessionaire could charge more to customers who want biogas .
Duke Energy Corp.
says it has a five-year plan to be a leader in renewable natural gas. Chevron Corp.
committed more than $ 200 million. Williams Cos Chief Executive Alan Armstrong told investors that the company, which transports nearly a third of all US gas in its pipelines, is positioned to switch to fossil fuels to reduce emissions.
King of Prussia, father’s UGI Corp.
sold its stake in a coal-fired power plant across the state. She bought a company that deals in California’s renewable gas credit markets and invested in a dairy gas project in Idaho. UGI executive David Lindenmuth said at an online biogas conference this month that the gas distribution company is following the example of its European businesses.
“The dealerships there have figured out how to stay relevant,” he said. “Keep this infrastructure invested, but also talk about how they can be partners in reducing greenhouse gases and not be separated by environmentalists.”
Pig barns are next to a canvas-covered pond on a Smithfield farm. Pig waste goes to the pond, where it decomposes and produces biogas.
Write to Ryan Dezember at [email protected]
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