Vespene Energy announced today that it has been invited by the U.S. Department of Energy (DOE) to submit a Part II application for a loan guarantee through the Loan Programs Office's (LPO) Title 17 Clean Energy Financing Program for $420 million to support the development of distributed biogas to electricity plants at 50 municipal landfills in 21 states.

Dubbed "Project Pleiades," the project is a collaboration between Vespene Energy, Mainspring Energy, and Bridge to Renewables (BTR) to support deep decarbonization across the solid waste and transportation sectors by using energy created from landfill biogas to charge electric vehicles. Through the capture and utilization of methane, the main component of biogas, Project Pleiades will generate 80 MW of dispatchable baseload renewable electricity for use in EV charging. Project Pleiades will be carbon-negative – achieving a net emissions reduction of over 1 million metric tons of carbon dioxide equivalent per year in aggregate across all 50 landfills.

The biogas captured by Vespene will also generate revenue for participating landfills, monetizing what is otherwise a liability for landfill operators.

Methane is an especially problematic greenhouse gas, with an atmospheric warming potential more than 80 times that of carbon dioxide over a 20-year period. Methane accounts for about 30% of global warming since pre-industrial times, and is a precursor to ground-level ozone — which is both a toxic air pollutant and greenhouse gas.

Vespene Energy is a renewable energy developer focused on large-scale methane mitigation through the deployment of distributed generation resources fueled by biogas. Their modular and scalable approach to electricity generation allows for the development of a wide range of biogas opportunities not economically viable using traditional methods.

"Landfills, particularly smaller ones in more rural locations, are a forgotten piece of the puzzle when it comes to the clean energy transition," said Adam Wright, CEO of Vespene Energy. "Methane emissions are a huge contributor to climate change, and landfills are the third largest emitter in the US. By capturing this wasted resource and turning it into electricity with Project Pleiades, in a single project we are able to achieve a significant step toward the Biden Administration’s goal to decrease landfill methane emissions as part of its 2021 action plan.”

Mainspring Energy will provide its innovative Linear Generators as the base electricity generation assets for every site across Project Pleiades. Mainspring’s patented, non-combustion technology reacts biogas at a low temperature, providing dispatchable clean electricity with near-zero NOx emissions, resulting in very low lifetime maintenance costs. Mainspring CEO Shannon Miller stated, “Mainspring is proud to work with partners like Vespene Energy to deploy our Linear Generators to mitigate methane emissions from landfills. Our technology is uniquely qualified to convert landfill gas to renewable electricity in a way that is highly efficient with low operating and maintenance costs. This creates greater returns for the landfill and project participants.”

Project Pleiades comes as the U.S. Environmental Protection Agency (EPA) has proposed enabling the generation of valuable credits known as e-Renewable Identification Numbers (eRINS) under its Renewable Fuel Standard (RFS). EPA has recognized since 2010 that electricity used to charge electric vehicles qualifies as a renewable fuel under the RFS, and biogas feedstocks have been eligible to generate eRINs since 2014. The EPA simply needs to finalize its proposal from December 2022 to create an accounting system to connect electricity production to EV charging. The value of eRINs are critical to enabling Project Pleiades and other similar projects that will have a substantial impact on reduction of methane emissions.

In order to participate in the RFS program, the EPA proposed to require biogas-derived electricity be linked directly to electric vehicles through information provided by the vehicle manufacturers. BTR, with its Transportation Program Management platform, will provide a key bridge that ensures the electricity generated by Project Pleiades is appropriately paired with vehicle manufacturers and supports charging of electric vehicles already on the road.

“Vespene Energy’s Project Pleiades is a perfect example of what is possible if the Biden Administration implements a portfolio of complementary policies to achieve its goals for methane emissions reductions,” said Jack Barrow, CEO of BTR. “An expanded RFS program will unlock significant new investments, clearly supporting the efforts of the White House, DOE, and Congress.”

Other parts of the EPA already support initiatives like Project Pleiades. Vespene Energy is an active partner of EPA’s Landfill Methane Outreach Program (LMOP) and strongly supports the mission of decreasing landfill emissions through increased recovery and beneficial use. LMOP is a voluntary program that works cooperatively with industry stakeholders and waste officials to reduce or avoid methane emissions from landfills. LMOP’s primary goal is to encourage non-regulated landfills to take voluntary action to reduce methane emissions.

In addition to energy generation and emissions reductions, Project Pleiades will pay over $10 million in annual royalties directly back to the municipalities and entities that own the participating landfills, and bring over 1,000 new jobs to rural communities through a combination of direct construction jobs and ancillary economic growth.

“We have looked at a number of potential projects to utilize our landfill gas but nothing has ever been able to work because of our small size” said Chris Ball, Executive Director of Des Moines County Regional Waste Commission in Burlington, Iowa. “We are very excited to be a part of Vespene Energy’s project on a number of levels. Because of this new revenue stream, we may be able to avoid large increases in garbage and recycling collection rates in our community, which puts money back into peoples’ pockets.” Des Moines County Landfill is one of 29 regional landfills participating in Project Pleiades that are not required to capture their methane.

The remaining 21 participating landfills have active gas collection systems, but are flaring their gas for compliance purposes.

“We have been excited about Vespene’s solution for quite some time.” said Darienne McNamara, Landfill Manager at the City of Superior, Wisconsin. “We have never looked at our landfill as having any potential for a beneficial energy project. We currently collect our gas and flare it off, but that system and its maintenance is a big expense for the City. With the royalties we can generate, we can put much needed resources back into the City coffers.”

The invitation to participate in Part II of the application process represents the culmination of nine months of work to satisfy the technical and eligibility requirements of the Part I application. Although this invitation is a major milestone and not given lightly, the DOE's invitation to submit a Part II application is not an assurance that the DOE will invite the applicant into the due diligence and term sheet negotiation process, that DOE will offer a term sheet to the applicant, or that the terms and conditions of a term sheet will be consistent with terms proposed by the applicant. The foregoing matters are wholly dependent on the results of DOE review and evaluation of a Part II application, and DOE's determination whether to proceed.