Velocys: Envia seeks EPA approval to generate D7 RINs

By Erin Voegele | January 16, 2018

Velocys plc has announced that Envia Energy, the joint venture plant that utilizes its technology, has applied for a fuel pathway approval under the Renewable Fuel Standard to produce D7 cellulosic diesel renewable identification numbers (RINs).

According to Velocys, Envia makes drop-in fuel from biogas and natural gas via gas-to-liquids technology featuring a Fischer-Tropsch process. Its facility, located adjacent to Waste Management’s East Oak landfill in Oklahoma City, Oklahoma, was on track to reach final operational capacity in late 2017. Velocys previously announced the facility is capable of producing premium wax, diesel and naphtha.

Subject to confirmation of a pathway approval from the U.S. EPA, Velocys indicated that the facility is expected to begin supplying RINs during the first quarter. The D7 RINs Envia expects to generate traded for more than $2.40 per gallon last year, according to Envia.

“This is a major achievement and milestone for both Envia and Velocys,” said David Pummell, CEO of Velocys. “On confirmation of the pathway compliance, these will be the first RIN credits generated by our technology and also the first associated with a Fischer-Tropsch process on landfill gas. This in itself represents a significant commercial validation of our technology.”

“The U.S. renewable fuels market is a high value growth market with incentives at both federal and state levels in the form of tradeable fuel and carbon credits,” Pummell continued. “Today’s news demonstrates that Velocys has the capability to secure renewable fuel incentives that will enable Velocys to unlock the attractive renewable fuels market.”

In October, Velocys announced plans to develop its first U.S. biorefinery in Natchez, Mississippi. The company noted that facility will exclusively use renewable feedstock, which equates to RIN values that were above $4 per gallon last year. In addition, the company plans to develop a waste-to-jet fuel plant in the U.K.

Velocys also recently announced plans to raise approximately £18.4 million ($25.38 million). In a statement, Pummel said the “financing ensures Velocys can take forward both the development of our second biorefinery in the U.S., targeting final investment decision around the middle of 2019 and completing the feasibility study for the third biorefinery in the U.K.”

A press release issued on the fund raise includes details on the proposed Mississippi and U.K. biorefineries. The document indicates Velocys is targeting a 20 MMgy capacity for the Mississippi plant. A facility of that size is expected to take in an approximately 900 metric tons per day of dry feedstock.

Regarding the U.K. plant, Velocys noted that two site options are currently under evaluation for the proposed plant. The targeted capacity is between 10 million and 20 million gallons per year, which would require 300,000 to 500,000 metric tons feedstock annually.