Detailed explanation of request for bids
Kansas Sustainable Agriculture District #001 is a political-economic proto type demonstrating a new model of rural economic development financed by external “green” investors. In this model, a publicly owned biomethane plant from which the CO2 byproduct stream is sequestered creates:
(i). local markets for agricultural commodities used as feedstocks,
(ii). reduced cost renewable fuel for local farmers’ vehicles, and
(iii). good jobs in rural communities.
The primary revenue driver for biomethane in the USA is that most renewable natural gas (RNG) that has been sold for use as “transportation fuel” qualifies for the highest value category D3 of “renewable identification numbers (RINs)” which petroleum refiners are obliged to buy in quantities commensurate with their production. The theoretical “demand” for D3 RINs is defined by US law passed with bi-partisan support as 16 billion per year. However, because the actual supply is far less than this amount, the Environmental protection agency (EPA) sets a “target” each year which is intended to approximate the actual supply. To the extent that supply is less than this “target,” the maximum price is capped at $3.50. The announced target for 2025 is 2.13 billion. This far exceeds the projected supply from projects “in the pipeline” now because EPA is actively encouraging expansion of capacity.
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