Power company Engie announced that it has made a final decision to proceed with a new UK-based biomethane plant, with an estimated investment of up to £70 million (USD$95 million), following a 10-year purchase deal with food and beverage company PepsiCo UK.
Biomethane, or renewable natural gas (RNG), 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. Biomethane is 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.
The biomethane purchase agreement (BPA) will begin in 2027 and provide PepsiCo UK with 60 GWh of biomethane annually through a mass balance approach, which PepsiCo said will help to decarbonize its supply chain.
This companies said that the biomethane supplied through the agreement is expected to reduce PepsiCo UK’s emissions by more than 10,900 metric tons per year.
Sian Hamson, Sustainability Senior Manager at PepsiCo UK said:
“As part of our PepsiCo Positive ambitions, reducing our greenhouse gas emissions remains a key priority within our UK operations. As a low carbon, domestically produced energy source, biomethane will be a key lever in our broader decarbonization strategy.”
The new plant, located in the North of England, will add to Engie’s current capacity of more than 210 GWh of biomethane annually injected into the UK gas grid annually from four operational anaerobic digestion plants in southwest England. These facilities use locally sourced agricultural waste and rotational crops, working in partnership with farmers and supporting circular economy practices through the production of digestate as a byproduct.
Miya Paolucci, Engie UK CEO, said:
“Engie is a global leader in power and gas purchase agreements, and our strength lies in our unique ability to leverage our integrated portfolio and deliver exactly what customers need. We are proud advocates of biomethane and are actively investing in projects which drive the energy transition, decarbonize our customers and support the move to clean energy.”
