PE firm bets on converting dairy waste into energy

Houston-based EIV Capital’s $47m investment in AMP Americas will support plans to expand production of biogas using dairy waste as a feedstock.

Energy-focused buyout firm EIV Capital has made a $47 million investment in AMP Americas, a renewable energy company that produces natural gas from dairy waste.

Capital from EIV’s investment will go towards adding personnel, expanding AMP’s network of fueling stations and supporting unspecified plans for new biogas production, according to a statement.

EIV declined to comment. AMP Americas did not return messages seeking further detail at the time of publication.

Chicago-based AMP produces and distributes renewable natural gas and compressed natural gas for the commercial trucking industry. The company has a subsidiary that owns and operates a network of 20 CNG fueling stations and another devoted to risk management and RNG sourcing.

A third business unit, Renewable Fuels Dairy, is devoted to the production of natural gas from dairy waste using an anaerobic digester located at Fair Oaks Farms in Indiana.

“By taking advantage of an abundant domestic fuel source, dairy waste, and converting it into valuable, clean, carbon-negative transportation fuel, AMP Americas is saving fleets money, improving air quality and reducing GHG emissions,” AMP said in its statement.

Anaerobic digesters mimic animal digestion to produce a gas that is largely composed of methane. That gas can then be turned into transportation fuel, with that process leaving behind a paste that can be processed further into an agricultural fertilizer.

According to Fair Oaks’ website, the entire facility runs on RNG and the fuel has been used to replace 2 million gallons of diesel previously used to power a fleet of delivery trucks.

There were 242 anaerobic digesters operating in the US as of May 2016, according to the US Environmental Protection Agency, with nearly 200 of those located on dairy operations and the rest divided between hog, poultry and beef farms. In total, anaerobic digesters generated 981 million kWh-equivalent of electricity in 2015, resulting in a 3 million-ton reduction in CO2 emissions, according to the EPA.

The two digesters operating on Fair Oaks Farms are capable of producing a combined 1.4 million cubic feet of biogas per day, making the farm the sixth-largest anaerobic digester-derived natural gas producer in the US, according to an EPA database.

EIV was established in 2009 and has $743 million in assets under management, according to PEI data. In February 2016, the firm closed its EIV Capital Fund III, which beat its $350 million target to close on its hard-cap of $450 million.

While EIV’s portfolio comprises mostly oil and gas investments, one of its assets, GlycosBio, is focused on the conversion of agricultural waste into hydrocarbons.