Republic & Clean Energy Go For Renewable Fuel From Landfill Gases

Republic Services, Inc. (NYSE: RSG) has announced a new agreement to recover landfill gas today with a unit of Clean Energy Fuels Corp. (Nasdaq: CLNE).  The move is to expand the availability of renewable natural gas from its North Shelby Landfill in Millington, Tennessee for multiple uses.  The waste management giant plans to use it as a vehicle fuel for its growing natural gas-powered fleet.

The Clean Energy Renewable Fuels unit of Clean Energy noted that this agreement is the second of its kind between the two industry leaders.  The first agreement at Republic’s Sauk Trails Landfill in Canton, Michigan is expected to come online in September 2012.

Clean Energy Renewable Fuels will build the plant to process landfill gas, a natural byproduct of decomposition, and it will then inject it into the US natural gas network.  After that the gas may be compressed and distributed for a variety of different uses, including vehicle fuel and as renewable power or other industrial use customers.

The companies claim, tha the plant is anticipated to produce approximately 4 million diesel gallon equivalents of renewable natural gas fuel annually during its first year of operations. This may not be a total game-changer for repurposing waste but the report says it could fuel about 260 trucks for a year.  Through the first ten years production is expected to increase to more than 5.7 million diesel gallon equivalents annually and production is expected to begin in late 2013.  The claim is that the environmentally friendly renewable natural gas derived from landfill biogas generates up to 88% fewer greenhouse gas emissions than diesel fuel or gasoline.

We’ll see, but it is another start. Clean Energy Fuels Corp. (Nasdaq: CLNE) is still down almost 1% to $13.25 against a 52-week range of $9.02 to $24.75.  Republic Services, Inc. (NYSE: RSG) is down almost 1% more at $27.86 against a 52-week range of $25.15 to $31.32.

It is important to keep Republic’s size in mind here.  As of December 31, 2011 (according to Yahoo! Finance), Republic owned and operated 334 collection companies, 194 transfer stations, 191 active solid waste landfills, and 74 recycling facilities in 39 states and Puerto Rico; and it operates 69 landfill gas and renewable energy projects.

JON C. OGG