Goldman Sachs Invests In Renewable Natural Gas Platform Synthica

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Energy transition platform Synthica Energy announced that it has closed an equity investment from Goldman Sachs Asset Management’s Infrastructure Business, and a partnership with the investor aimed at scaling its renewable natural gas (RNG) production operations across U.S. hubs.

RNG, or biomethane, is expected to play a critical role in the transition to cleaner energy sources, particularly for sectors in which energy solutions such as wind or solar are less practical. RNG is typically produced from organic waste, such as agricultural, industrial, and household wastes, and is chemically identical to fossil-based natural gas, enabling it to support the decarbonization of hard-to-abate sectors such as road transport and heavy industry, without needing to replace existing transmission and distribution infrastructure.

In addition to providing the benefits of fossil gas without its carbon emissions, RNG also helps avoid methane emissions that would be released through the decomposition of organic waste.

Founded in 2017, Ohio-based Synthica produces RNG from pre- consumer food and beverage waste and other organic manufacturing byproducts through anaerobic digestion. By utilizing pre-consumer waste, the company avoids challenges of post-consumer waste-based RNG production methods, including varying supply and contamination levels, enabling greater efficiency and consistency in the production of RNG. The company also noted that it provides a circular solution by enabling the repurposing of pre-organic waste that might otherwise end up in a landfill and contribute to greenhouse gas emissions.

Synthica said that the investment will support the growth of its infrastructure projects and accelerate the development of facilities in key U.S. markets including Ohio, Texas, Georgia, Kentucky, and Louisiana in the near term. The company also plans to develop facilities in Florida, Illinois, Missouri, New York, and Pennsylvania.

Sam Schutte, CEO of Synthica, said:

“Synthica’s mission is to provide a critical service for hard-to-process organic waste streams, divert these materials away from landfills and other non-sustainable disposal outlets, and ultimately reduce carbon and methane emissions. We are excited about partnering with Goldman Sachs since it will enable us to accelerate our project development pipeline, enhance our circular solutions for our customers, and supply RNG to meet the growing market demand.”

The announcement marks the latest biofuels-focused investment by Goldman Sachs. Earlier this year, the firm launched a new investment platform, Verdalia Bioenergy, aimed at capitalizing on biomethane investment opportunities in Europe, with plans to deploy more than €1 billion over the next four years.

Cedric Lucas, Managing Director in the Infrastructure Business within Goldman Sachs Asset Management, said:

“Similar to our Verdalia investment in Europe focused on biomethane, we believe this sustainable process can provide dual benefits, helping businesses and municipalities beneficially reuse their organic waste and supplying the country’s utilities with RNG, critical for reducing their carbon footprints.”

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