Hitting the Gas: Opal Fuels Accelerating RNG Growth

With thousands of active landfills across the U.S., Opal Fuels co-CEO Jon Maurer sees plenty of opportunities to capture biogas from decomposing waste and transform it into renewable natural gas (RNG).

“There’s economies of scale to building one of these projects. The larger landfills are the easiest ones to do, and as you start to get down your pyramid to smaller sized projects, there’s more and more of them,” he said. “So really the question is how innovative can you be and what rate of return are you willing to accept as you get to smaller projects where there’s more and more of them. We see a lot of opportunity out there.”

Last year, the New York-headquartered company increased RNG production to 3.8 million MMBtu, a 41% increase year-over-year. In 2025, Opal aims to produce between 5 million MMBtu and 5.4 million MMBtu of RNG in 2025—a 27% increase— as projects brought online in 2024 ramp up and new projects come online.  

With more than 8 million MMBtu of capacity online, Opal has said it will put 2 million MMBtu into construction this year. In late February, the company announced plans to develop four new landfill RNG production projects in the Midwest and South as part of joint venture partnerships, with a combined capacity of 1.5 million MMBtu.

The plans to add capacity and boost production come amid continued efforts to lower methane emissions across the U.S. Landfills represent the third-largest source of methane emissions in the U.S., according to the U.S. Environmental Protection Agency.

The drive toward lower emissions is leading to a rise in RNG projects. After being upgraded to pipeline quality, RNG may be put in existing pipeline networks and used the same way as fossil natural gas to generate electricity, fuel vehicles and be put to other uses.

But supportive policies will be needed to help accelerate use of RNG, specifically in the heavy-duty truck fueling industry, according to Maurer.

“California, which historically has led the way on renewables, was mandating zero-emission vehicles, and they were trying to transition everything to zero-emission vehicles,” he said. “The problem is that this renewable category is not zero emission, but we happen to believe that it is an attractive alternative. Certainly, it is less carbon intensive than diesel fuel.”

He believes RNG can do for heavy-duty vehicles what natural gas did for emissions reduction in energy generation.

“A large shift from coal to natural gas resulted in a large reduction in carbon emission,” he said. “We think that the same could be true if diesel trucking was incentivized to move towards this CNG fuel or renewable natural gas fuel vehicles.”

‘Big win’

A recent report by Energy Vision focused on the climate benefits of replacing old diesel trucks. The New York-based nonprofit research institute is focused on preventing methane emissions from decaying food and farm waste. The group analyzed the health benefits, costs, commercial availability and performance of three cleaner non-fossil fuel options—RNG, renewable diesel (RD) and electric vehicles—to replace 130,000 old heavy-duty vehicles in 31 U.S. counties.

The group declared new RNG models as the “overall winner.”

“The heavy-duty RD option is the least expensive, high-performing and widely available now, but the emissions reductions and the resultant health benefits are the smallest of all the options. The RD option is also much less cost-effective than the RNG option over the trucks’ 15-year lifespan,” according to the report.

Heavy-duty EVs would provide the greatest emissions reductions and health benefits, but their limited availability and “very high purchasing premium and performance shortcomings mean heavy-duty EVs are not feasible for the mass replacement” of diesel vehicles in at least the next few years, Energy Vision said.

The report singled out RNG trucks’ affordability, RNG’s wide commercial availability, its health impact benefits and the abundance of existing organic waste feedstocks available to “produce enough RNG to displace around a quarter of all on-road diesel usage in the U.S.”

“Given the climate crisis confronting our world, it is important to note that RNG also has vastly lower lifecycle greenhouse gas emissions than diesel. When derived from discarded food waste or manure, RNG is considered ‘net carbon negative’—meaning more greenhouse gases are avoided (as potent methane) during its production than are emitted (as less potent CO₂) when it is combusted,” Energy Vision said in the report.

In contrast, the report said, many battery electric models use power generated at least in part from fossil fuels, impacting their lifecycle greenhouse gas emissions.

Vertically integrated

RNG can be sold to utilities or through the voluntary market, Maurer said.

“Just to give you a scale … the price of gas like at Henry Hub or NYMEX is around $4 per MMBtu,” he said.

Within “this voluntary market, the utilities will buy our gas for around $20 per MMBtu. When we put it into the vehicle market, it’s worth $30 to $40 per MMBtu. So, you can see there’s a huge value to the transportation fuel market, incremental to the voluntary utility market and all of that is worth a lot more than just what we call brown gas without environmental attributes.”

Transportation RNG fetches a higher price because it benefits from a D3 RIN credits, or cellulosic renewable identification numbers. The credits are issued by the EPA and are used to track compliance with renewable fuel standards.

“The biggest challenges really are …[around] long-term visibility into what the regulations are and what the value of your fuel is,” Maurer said. “Because of that uncertainty, people don’t know whether our fuel is worth $2 or $3 per RIN; maybe it’s worth $60 million or $100 million. … I think that it’s incumbent upon the government and the EPA and the industry to really express what that long-term visibility looks like.”

In addition to producing RNG, vertically integrated Opal Fuels has a network of more than 350 fueling stations, working with companies such as UPS and Waste Management, Maurer said.

“What’s interesting about being vertically integrated is … that the transportation fuel offtake is the highest value, but it’s limited. And because we build it, we build that infrastructure, we have a larger access to it than others do,” Maurer said. “That gives us an advantage when we’re talking to landfills who want to maximize the value of their landfill gas. Similarly, when we’re talking to fleet customers, because we have the access to the RNG, it gives us an advantage. So, because of those advantages, we then have the ability to grow at a rate that may be a little bit better than our competitors.”

Opal Fuels operates nearly one dozen RNG projects, is building another six and runs 15 renewable power projects.

Crucial to hitting growth targets are relationships, Maurer said, something the company continues to build with landfills. Among the company’s partners are energy infrastructure holding company South Jersey Industries (SJI), environmental services company GFL Environmental and Waste Management.

“The key here is relationships, partnerships, access to landfill gas projects [and] executing on the opportunity set,” Maurer said. “That will drive our growth, both in terms of our upstream landfill RNG production and our downstream station build with respect to our fleet customers.”