California In-State RNG Study

Published July 2020

Client: California Natural Gas Vehicle Partnership, Clean Energy Renewable Fuels, Pacific Gas & Electric, Shell, South Coast Air Quality Management District, Southern California Gas Company, Trillium: A Loves Company, TruStar Energy

View Full Report

View Executive Summary


In the summer of 2019, staff at the California Air Resources Board (ARB) drafted a proposal to disqualify natural gas vehicles (NGVs) from one of the state’s most popular programs promoting the purchase of advanced, clean transportation technology, the Heavy-Duty Vehicle Incentive Program (HVIP). Proponents of increasing the use of near-zero emission NGVs fueled by renewable natural gas (RNG) opposed the modification suggested by the air agency’s staff. After several months of back-and-forth, the parties eventually reached an arrangement. The accommodation limited future HVIP funding to natural gas fueled heavy-duty vehicles equipped with an 11.9L low NOx engine. The compromise added an additional requirement: in order to qualify for the HVIP funding, the new vehicle must be fueled with RNG produced within the state of California.

At the time that this understanding was reached, neither the ARB nor the NGV/RNG industries had any sense of the supply of California-produced RNG.  When this new constraint was placed on future NGVs applying to the HVIP, no one knew how much in-state RNG was being produced in California. Nor was it known when new supplies would be coming online, and how much California RNG would be available in the future. The only projections performed on future RNG supply were theoretical. Without better data on the in-state supply of RNG, it is not possible for ARB or the industry to know if HVIP applicants will be able to comply with this new requirement. Moreover, if other authorities try to apply this same constraint to their state and local vehicle incentive programs, the effort would be hampered by the same absence of data. The estimated RNG inventory described in this report attempts to fill this void.

Most existing studies of future RNG supply have focused on hypothetical potential production. Researchers have looked at the availability of organic feedstocks that could be used for RNG production. Using volume projections for such raw materials, they estimated the amount of gas that could theoretically be produced. Such studies have also primarily focused on supplies of materials that can easily be anaerobically digested (i.e. high moisture, low-solids content). They have tended to ignore other technologies that could be used to produce high-BTU renewable methane, such as pyrolysis, gasification, and electrolysis.

The goal of this study is to provide stakeholders and policy makers with a much more accurate, data-driven estimate for the total volume of RNG that will be produced in-state and made available for transportation use by California fleet operators in the near term. By using data provided by state and local agencies, project developers, 3rd party marketers and other reliable sources, this inventory assesses the actual RNG production of existing and developing projects. It provides a reasonably reliable estimate of the actual supply of in-state RNG that was being produced on January 1, 2020, the growth in production that will take place by quarter over the next four years, and the total supply of California-produced RNG that will be flowing to end users in California on January 1, 2024.  This research determines that, as of the publication of this report, 160 California-based RNG production facilities will be supplying i more than 15.8 million MMBTU, or nearly 119 million diesel gallon equivalents (DGE), to transportation end users by the beginning of 2024. As a significant proportion of the growth in “domestic” production will come from California dairies, the energy weighted Carbon Intensity (CI) value of the instate supply of RNG will be approximately -101.74 gCO2e/MJ.

If California were to adopt policies to encourage the purchase and deployment of new near zero emission (NZE) natural gas trucks to consume this new California-derived, carbon negative, diesel displacing clean fuel, the environmental benefits would be significant. Adjusted for Energy Economy Rating (EER), 119 million DGE would be sufficient to fuel 13,731 natural gas trucks annually. If the HVIP was to provide a $45,000 voucher toward the purchase of each of these new NZE heavy-duty natural gas trucks, it would cost the state $618 million. Assuming a fifteen-year life for these vehicles, they would generate 51.4 million metric tonnes of CO2e and 20.8 thousand tons of NOx reductions, at a cost of $12.03/MT of CO2e and $29,702 per ton of NOx.

This RNG supply estimate only represents those projects that exist or are currently in development and meet this study’s criteria for inclusion. It provides a snapshot in time. Given the accelerating pace of development of new RNG production in the state, unannounced grant awards, as well as the impacts of new regulations such as CalRecycle’s SB 1383 organics recycling and procurement requirements, these results are likely to be conservative, and actual in-state RNG production on 1/1/24 will be significantly greater.


View Full Report