A few years ago, Adam Wright was walking through a Berkeley, Calif., park when he encountered a smokestack combusting methane. The flare was the city’s mitigation measure to break down the gas seeping from a landfill that had closed decades earlier and been converted into a bayside amenity.
The constant supply of gas sparked an idea: What if he could generate electricity with it? Tying together individual small landfills across the country could power things like electric vehicle charging, Wright thought.
Not long after that stroll, Wright co-founded Vespene Energy.
Over the last two years, the startup has built partnerships with 50 municipal landfills in 21 states, aiming to generate 80 megawatts for EV charging, enough to support more than 275,000 full battery electric vehicles.
By capturing the methane, the company estimates it will reduce emissions by more than 1.2 million metric tons of carbon dioxide equivalent annually while paying smaller landfill owners who have few options, if any, to mitigate the liability.
“We think it’s really an untapped resource that could make a substantial difference in bolstering the nation’s energy supply,” Wright said. “We’re helping to create a circular economy; we’re taking a waste stream and turning it into an asset.”
On Wednesday, Vespene announced its landfill sites, which it’s collectively calling Project Pleiades, have advanced to the second phase of securing a $420 million loan guarantee from the Energy Department. And it highlighted the stakes for the US Environmental Protection Agency to finalize a credit system that would provide a key source of revenue on top of an Inflation Reduction Act investment tax credit.
The company is exploring whether it could also qualify for the 45Z Clean Fuel Production Tax Credit.
Supporting the Grid
The prospect of harnessing a round-the-clock source of energy that can reduce emissions is enticing at a time the US power grid is coming under stress.
After decades of slow-to-flat demand growth, the grid is now experiencing a rapid deployment of data centers powering the internet, artificial intelligence and cryptocurrency mining; the electrification of gasoline-powered vehicle fleets; and energy-intensive manufacturing of products like hydrogen.
The grid also must become more flexible to keep the lights on during extreme weather events. Instead of drawing from massive centralized power plants connected to cities by long-distance power lines, more localized generation distributed across the country can make the grid more resilient.
Energy experts have already been looking to bundle consumer devices like smart thermostats, water heaters, rooftop solar, and residential batteries to better match supply and demand.
Project Pleiades extends this principle to biogas, a category of energy fuel from landfills, wastewater plants, dairy farms, and other sites. Total energy production from biogas could be enough to power 9.3 million homes, according to the American Biogas Council.
Each participating landfill site would have trailers of equipment that pull out the gas, condition it, and run it through a specialized generator to send power onto the distribution grid.
The generator’s non-combustion technology reacts biogas at a low temperature, providing dispatchable clean electricity with near-zero nitrogen oxide emissions, said Shannon Miller, CEO and a founder of Mainspring Energy, a Menlo Park, Calif.-based equipment manufacturer.
Open the Floodgates
The power will be matched with EV charging sites through the EPA’s proposed credit system, known as the e-Renewable Identification Numbers (eRINS) program. In December 2022, the EPA proposed to create an accounting system for biogas-derived electricity to be linked directly to electric vehicles through information provided by the vehicle manufacturers.
But the agency excluded the system from updates to the broader renewable fuel standard finalized last June. EPA needed more time “given the volume and complexity of comments in conjunction with the tight rulemaking schedule,” Shayla R. Powell, an EPA spokesperson, said in a written statement. “We have no updates at this time on finalizing the eRIN provisions.”
The EPA has estimated eRINS could produce billions of dollars a year that would be used to invest in these projects and increase methane capture, said Jack Barrow, CEO of Bridge-to-Renewables, a Washington-based firm partnering with Vespene. The company will provide a software platform to pair electricity generated by Project Pleiades with vehicle manufacturers and the charging of electric vehicles already on the road.
“eRINs and investing in these technologies are a great solution to that because it makes it economically viable,” Barrow said. “We think it aligns so squarely with the Biden administration’s objectives.”
Wright said the company doesn’t expect any major hurdles for the EPA to finalize the credit system. The company plans to finish development of the projects and be ready to break ground when the agency acts.
“Once eRINs get turned on, then that sort of opens the floodgates,” Wright said.
Liability Becomes Revenue
That would be good news for smaller landfills contending with emissions of methane, a powerful heat-trapping gas that’s created as organic waste decomposes.
Landfills were a driver in market growth for renewable natural gas, or RNG, a type of biogas that has replaced drilled natural gas as a source of power, heating, vehicle fuel, or feedstock over the last two decades.
But the RNG market requires major infrastructure, including tapping into a pipeline system, funded by economies of scale only larger landfills that produce much more gas can achieve, said Chris Ball, executive director of the Des Moines County Regional Waste Commission, which runs a landfill near Burlington, Iowa, that is working with Vespene.
Smaller landfills in more rural areas often have no choice but to combust the methane, which converts it to carbon dioxide, or simply vent it into the atmosphere, Ball said. Landfill operators risk explosions if they don’t vent the methane.
The Burlington landfill accepts roughly 54,000 tons of trash annually and must vent the methane because it doesn’t produce enough to feasibly combust it, he said. Des Moines County is some 160 miles east of the city of Des Moines, Iowa, which has a much larger landfill.
“There was really no option for us until Vespene came along,” Ball said.
Project Pleiades promises to pay a total of more than $10 million in annual royalties directly back to the municipalities and entities that own the participating landfills, Vespene said. The power projects will bring over 1,000 new construction and ancillary jobs to rural communities, according to the company.
Initially, the Des Moines County landfill expects to receive $100,000 to $125,000 a year, which would amount to $2 savings on a rate of $53 a ton for household trash, Ball said. “If we can reap some reward, that keeps us from having to raise our rates as much,” he said.