Chevron expands dairy biogas partnership

US major Chevron said October 6 it had expanded its partnership with California Bioenergy LLC (CalBio) with a joint investment in a second holding company to produce and market dairy biomethane as a renewable natural gas (RNG) transportation fuel in California.

The holding company, CalBioGas Hilmar, has secured initial funding to begin developing infrastructure for biomethane projects in the state’s Merced County.

CalBio brings technology and operational experience to the partnership, helping dairy farmers build anaerobic digesters and methane capture capability to convert the biomethane to RNG, which is considered net negative on a lifecycle basis under California’s Low Carbon Fuel Standard.

Under the latest agreement, Chevron will provide funding for as many as seven digesters and one central upgrading facility across a cluster of dairy farms in Merced County. When completed in 2023, Chevron will take 100% of the RNG produced to market as a vehicle fuel in California.

“This project brings together support from many groups, including seven California Dairy farmers, who are national leaders in milk and cheese production; Chevron, one of California’s largest energy companies; and grant funding from the California Department of Food and Agriculture,” CalBio president Neil Black said.

The partnership with CalBio, said Andy Walz, president of American Fuels & Lubricants for Chevron, underscores the major’s commitment to produce 40,000mn btu/day of RNG by 2030 and grow its lower carbon businesses.