After the uncertain rise and precipitous fall of a number of Canada’s energy-from-waste (EfW) industries, it may have been easy to underestimate the commercial opportunities for renewable natural gas (RNG).
After all, the corporate community lost much of its interest in capital intensive and technologically uncertain EfW projects at some point following the 2008 crash. With a few notable exceptions, EfW became a local, and mostly municipal, waste management issue, usually undertaken on a small scale. This has been quietly, yet rapidly, changing with the growth of RNG and the related environmental pressures for more resource recovery.
Provincial Climate Change Commitments Prompt RNG Buying Spree
While the RNG market pre-dates provincial climate change commitments and has proven resilient in the “voluntary market”, there has been a recent spike in RNG supply procurement, particularly in the provinces with the most meaningful GHG reduction commitments: British Columbia and Quebec.
British Columbia, for instance, has amended its Greenhouse Gas Reduction Regulation to include an RNG portfolio of up to 5% RNG in its natural gas system. This, in turn, is spawning a growth of projects across the province seeking to generate RNG from agricultural and other organic inputs, which can be fed directly into the provincial natural gas distribution network.
Diverse Suppliers and Regional Opportunities
Suppliers of RNG come from a broad range of activities and industries. The spectrum runs from landfill operators and food/organics waste processing sites to private sector wastewater treatment plants and commercial food and other agricultural production facilities, creating two or even three (if you count environmental attributes) revenue streams for a proponent.
Decentralization of RNG production, particularly in the case of agricultural outputs, will also allow for local applications of biomass residuals from certain RNG production processes.
Organics Closed Loops a Key “Driver”
Clear evidence of RNG as a commercial scale vehicle fuel is available in both Canada and the United States. In California, Clean Energy Fuels has been providing a number of municipalities with Renewable Liquid Natural Gas to run their refuse collection fleets.
More recently, the City of Toronto installed biogas upgrading equipment to convert Toronto’s organic waste-derived biogas into RNG, using a:
“closed loop approach where organics collection trucks can ultimately be powered by the waste product they collect”.
It’s a sustainability initiative that others have (i.e. Surrey) and will, soon embrace.
Anaerobic Digestion Guideline Anticipates RNG Demand
The Canadian Biogas Association has recognized the coming RNG opportunity, particularly through anaerobic digestion, with its release of the Canadian Anaerobic Digestion (AD) Guideline.
This guideline recognizes both the “circularity” pressures for IC&I food waste and organics, and the coming federal Clean Fuel Standard regulatory requirements, mandating lifecycle carbon intensity reductions.
The convergence of robust demand and economically viable supply has surely made RNG production an emergent EfW industry winner for years to come.