Investors are bullish on the low-carbon gas because it is economic today, said ABC member Stifel Equity Research in a recent white paper. “In 2020, dairy and landfill gas projects earned average price realizations of $100/MMBtu and $30/MMBtu, respectively, well above their respective average cost of supply. Based on our assessment of over 20 projects across the primary RNG feedstocks (landfill, animal manure, wastewater), we estimate the industry generates project-level [internal rate of returns (IRRs)] in the 10% to 65% range assuming strip prices, and current federal and state programs. We expect returns to improve as operators advance anaerobic digestion technology, improve operating efficiency, and better integrate digestate sales into their operations.” More >>
