SoCalGas announces first RNG contract approved under California (U.S.) program
Southern California Gas Co. (SoCalGas) has announced it has executed a contract with Organic Energy Solutions (OES) to procure renewable natural gas (RNG) converted from organic waste and inject it into SoCalGas' pipeline system.
The contract is the first approved by the California Public Utilities Commission (CPUC) under Senate Bill (SB) 1440 which sets specific RNG procurement targets for the state's natural gas utilities. The RNG will be sourced from a project located in the city of San Bernardino and is an important step toward achieving California's goal to reduce methane emissions from agriculture and waste while advancing energy decarbonization in the state.
SB 1440 is recognized as the nation's first renewable gas standard and led the CPUC to set goals for the procurement of RNG, also known as biomethane, which is made from the organic waste of wastewater treatment plants, dairies, landfills, agricultural practices and forestry residues. Depending on its source, RNG can be carbon negative, meaning it captures more greenhouse gases than it emits. SoCalGas aims to replace approximately 12% of the traditional natural gas it delivers to residential and small business customers with RNG by 2030, pursuant to the targets that have been established under SB 1440 by the CPUC. The new RNG standard is expected to help the state achieve its goal to reduce methane emissions by 40% by 2030.
"As the first RNG procurement project under California's renewable gas standard, this contract represents an important milestone for the RNG industry and SoCalGas as we work together to advance California's energy goals," said Elsa Valay-Paz, vice president of gas acquisition at SoCalGas. "By converting waste that would otherwise end up in landfills into usable energy, this project is intended to help reduce greenhouse gas emissions, improve air quality and help California reach its climate goals."
"At OES, we are proud to unite with SoCalGas on this groundbreaking renewable natural gas project, which marks a significant step forward in California's transition to cleaner energy. By converting organic waste into a valuable energy resource, we aim to not only reduce greenhouse gas emissions but also create a more sustainable and resilient energy future," said Brian Hume, senior vice president of operations for BioStar Renewables, owner of OES. "This collaboration underscores our commitment to innovation in waste-to-energy solutions and our shared vision for a cleaner, more sustainable California."
OES, a company specializing in biomass processing and fuel production, will collect organic waste – a source of greenhouse gas emissions (GHGs) – from local industrial and food waste, and process it in an anaerobic digester which speeds up natural decomposition. Methane emissions from the decomposition process are captured and converted into RNG, which will then be injected into the SoCalGas pipeline system. The project is expected to begin supplying RNG to SoCalGas' system in the second half of 2026. Organic waste in landfills contributes to approximately 20% of California's methane emissions. Once operational, OES estimates the project will prevent approximately 15,300 tons of GHGs from entering the atmosphere each year, which is the equivalent to the energy usage of 2,984 homes per year or 1.7 MMgal of consumed gasoline.
RNG is already helping reduce emissions from trucks and buses, contributing to cleaner air. In 2019, SoCalGas began replacing traditional compressed natural gas with RNG at its fueling stations to help reduce GHGs. Since 2020, the RNG supplied at SoCalGas' 37 fueling stations has been classified as carbon negative by the California Air Resources Board (CARB). SoCalGas continues to advance its efforts to decarbonize the fuel it transports, delivering approximately 5% RNG to customers since 2023.
"SoCalGas' progress toward RNG procurement targets established under California's SB 1440 will be watched closely by counterparts and policymakers in other U.S. states, with the potential for agreements like these to create a powerful precedent for lasting energy system change," said Sam Wade, vice president of public policy for RNG Coalition. "RNG is an innovative climate solution that converts methane emissions from organic waste into a low-carbon replacement for fossil fuels, making it a cleaner fit for long-term decarbonization plans at the utility level."
SoCalGas' RNG initiatives support California's clean air and climate goals, including the CARB Scoping Plan, which projects RNG will play a vital role in reducing GHGs and decarbonizing industrial buildings and processes, as well as the transportation sector. The California Integrated Energy Policy Report also found that RNG can significantly reduce GHGs and pollutant emissions compared to conventional diesel trucks.
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