Energy Intelligence Group – October 12, 2020
Written by Casey Merriman

Chevron sees a bright future in natural gas-powered auto transportation. But it will be cows, not dinosaurs, supplying the fuel.

The California-based integrated major penned a joint agreement last week with renewable natural gas (RNG) specialist Brightmark. The venture, Brightmark RNG Holdings, will construct commercial-scale biomethane projects in Florida, Michigan, New York and South Dakota. Chevron will then market the manure-fed RNG to California’s transport market (NGW Apr.27’20).

“We’re in the energy business, and we’re looking for affordable, reliable and ever-cleaner energy,” Andy Walz, Chevron’s president of Americas Products, told Energy Intelligence in an interview. “And in California, there’s infrastructure here where [RNG] has an opportunity to get to the marketplace.”

That infrastructure has evolved on the back of the state’s low-carbon fuel standard and slate of other legislative initiatives to clean up California’s transportation emissions. Gov. Gavin Newsom (D) hopes to fully eliminate the state’s petroleum diesel emissions by 2030.

 

Carbon Neutrality
Compressed natural gas- (CNG) and LNG-fueled vehicles still emit carbon dioxide when their fuel is combusted. But if supplied from carbon negative sources of RNG, the vehicle’s life-cycle carbon footprint can support absolute emission reduction goals.

The RNG that Chevron and Brightmark are pursuing ticks that box. The process captures what would otherwise be fugitive methane emissions from the dairy industry — a significant source of greenhouse gases — and fewer CO2 emissions come from a CNG/LNG tailpipe than a conventional diesel one. The combined result is a life-cycle emissions footprint that can be up to 400% lower than traditional vehicle fuels.

“That’s probably the most important” selling point of dairy-based RNG, Walz said.

Chevron, of course, is not in the business of the anaerobic digestion of cow manure. And Brightmark is not in the business of marketing transport fuels. But rather than spend years and hefty sums to build out the respective expertise, the duo instead decided to team up.

“We view Chevron as the Yen to our Yang,” Brightmark founder and CEO, Bob Powell, told Energy Intelligence. “We have an expertise in developing these environmentally friendly RNG projects, getting them built and operating them on a long-term basis. And I think Chevron is really good once we create the RNG at finding the best use.”

At the same time, Chevron wants to learn how low-carbon alternative fuel systems work, so owning a piece of the production stream is key to its strategy, as opposed to just buying volumes wholesale. “We want to own the whole value chain,” Walz said.

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