Aemetis, Inc. a renewable natural gas and renewable fuels company focused on negative carbon intensity products, closed the sale of $53m of Inflation Reduction Act (IRA) investment tax credits generated by its subsidiary Aemetis Biogas LLC to a corporate purchaser on September 29, 2023.
This sale is the company’s first IRA tax credit transaction. The Section 48 investment tax credits were generated from biogas projects built by Aemetis Biogas, including six dairy digesters, a biogas pipeline and a renewable natural gas (RNG) production facility, Aemetis said in a press release.
The Inflation Reduction Act was signed into law in August 2022, and provides for the issuance of transferable federal income tax credits for certain renewable fuel projects and products.
“We believe that this $5m tax credit sale is the largest IRA tax credit transaction in the dairy biogas industry, demonstrating the transferability of tax credits under the federal Inflation Reduction Act and the ability of renewable fuels projects to generate funding from IRA tax credits to support investments,” stated Eric McAfee, Chairman and CEO of Aemetis. “The Aemetis Five Year Plan is expected to qualify for more than $800m of IRA investment and production tax credits during the next four years to support our biogas projects, CO2 re-use by our ethanol plant, the construction of our sustainable aviation fuel plant and CO2 sequestration.”
Aemetis Biogas is building anaerobic digesters at California dairies to capture biomethane from animal waste. Aemetis has seven operating digesters and is actively growing with an additional five digesters under construction and a total of the 37 dairies under contract to supply animal waste. After removal of contaminants and pressurization of gas at the dairy, a biogas pipeline connects the dairies to a centralized facility located at the Aemetis Keyes ethanol plant where the biogas is upgraded into below zero carbon intensity RNG. The RNG is injected into PG&E’s natural gas pipeline for delivery to transportation fuel customers in California.
Aemetis is also building its own RNG fueling station at the Keyes ethanol plant to fuel trucks with locally produced renewable natural gas that provides a 90% reduction in emissions compared to petroleum diesel fuel.
