Understanding Renewable Natural Gas (RNG) Credits

Introduction

In the effort to reduce wasted energy, Renewable Natural Gas (RNG) has become a valuable resource by capturing methane (CH4) from organic waste and converting it into a low-carbon fuel. RNG helps offset fossil fuel use and generates environmental credits that can be monetized through federal, state, and voluntary programs. These credits are financial incentives to reduce CH4 emissions and improve waste management practices. This blog highlights key crediting mechanisms for RNG, outlines certification and compliance requirements, and discusses the importance of monitoring and verification in ensuring credit integrity.

Renewable Natural Gas (RNG)

RNG is a high-BTU gas derived from anaerobic decomposition of organic waste in sources like municipal solid waste landfills (MSWLs), wastewater treatment facilities (anaerobic digesters), livestock operations, and food waste digesters. After treatment to remove CO2, VOCs, and other impurities, RNG can contain 98% or more of CH4 – equivalent to fossil natural gas in quality.

RNG Credits and Applicable Programs

The generation and use of renewable natural gas (RNG) can qualify for environmental credits under several regulatory and voluntary programs, depending on the end use and the program's requirements. Some programs for RNG include:

• Voluntary Carbon Offsets (e.g., Verified Emission Reductions – VERs):

• Applicable when RNG reduces or avoids CH4 emissions, regardless of beneficial end use.

• Suitable for non-transportation applications (e.g., heating, electricity).

• Certification programs include:

• Verra’s Verified Carbon Standard (VCS)

• Climate Action Reserve (CAR)

• American Carbon Registry (ACR)

• RINs (Renewable Identification Numbers):

• Generated under the federal Renewable Fuel Standard (RFS) administered by the U.S. EPA. The RFS mandates blending renewable fuels with gasoline or diesel to reduce GHG emissions.

• Applicable only when the RNG is used as transportation fuel.

• RNG qualifies as a D3 (cellulosic biofuel) RIN.

• Each RIN represents one ethanol-equivalent gallon (approximately 76,000 BTU).

• Producers must register and report via EPA’s Moderated Transaction System (EMTS).

• LCFS Credits (Low Carbon Fuel Standard):

• Managed by the California Air Resources Board (CARB).

• Applies to transportation fuel.

• Credits based on the carbon intensity (CI) of the fuel.

• Negative CI scores (e.g., RNG from dairy manure) yield higher credit values.

• State-Level Programs:

• Examples include:

• Oregon Clean Fuels Program

• Other state initiatives with LCFS-like frameworks

Applications That Qualify for RNG Credits

Projects that produce and upgrade biogas to RNG can generate credits when the gas is:

• Used as transportation fuel, the RNG must be used in compressed natural gas (CNG) or liquified natural gas (LNG) vehicles.
• Injected into a pipeline and matched to vehicle use downstream.
• Used as a fuel for electricity generation or thermal applications that replaces fossil fuel use in voluntary markets.

RNG Credit Certification Process

To earn credits, RNG producers must go through a detailed certification process that can include:

• Project development to define project scope, waste-derived feedstock (e.g, landfill gas) and RNG production that avoids CH4 emissions or displaces fossil fuels.
• Project registration with a carbon registry organization, EPA (for RFS) or CARB (for LCFS).
• Feedstock and pathway determination to confirm that RNG source and end-use qualify under the program.
• Project approvals required by the EPA RIN Pathway and the California Carbon Intensity (CI) Calculation Approval: Use EPA pathway petitions or modeling tools (e.g., CA-GREET for LCFS). Some of these items are included in the Project Description Document used by a voluntary carbon offset program such as Verra’s VCS.

• RIN Pathway refers to the specific combination of:

• EPA Moderated Transaction System (EMTS) for RFS

• LCFS Reporting Tool (LRT-CBTS) for California

• Carbon registries (Verra, ACR, CAR) for voluntary credits

• Third-Party Verification: Required annually in LCFS and voluntary markets. Verifiers assess project performance, CH4 destruction efficiency, and system integrity.
• Leak Detection and Maintenance: Operators must inspect and maintain pipelines, flares, compressors, and other equipment to avoid CH4 leakage.

Mitigation of Methane

Uncontrolled CH4 emissions from landfills and anaerobic digesters contribute to climate change. RNG systems reduce these emissions by capturing CH4 for use as a fuel. When beneficial use is not feasible, CH4 can be recovered and combusted in a flare or enclosed device to prevent release.

Cimarron’s proven solutions for biogas mitigation include:

• Biogas Beneficial Use – biogas recovery systems and compression packages are available for medium to high BTU projects to enable the beneficial use of captured CH4.
• Biogas Collection and Control – Cimarron offers blower systems, open tipped flares and enclosed combustion devices, low BTU (LBTU) oxidizers for low-energy streams, and ultra-low emission combustion systems to control and destroy collected biogas.
• Auxiliary Equipment – gas conditioning systems include knockout drums, coolers, heat exchangers, dehydration units, and siloxane removal systems to prepare biogas for combustion or beneficial use.

Summary

Renewable Natural Gas (RNG) is a low-carbon energy source produced from organic waste streams such as landfills, wastewater facilities, and livestock operations. Beyond its energy value, RNG qualifies for environmental credits through federal, state, and voluntary programs. These include RINs under the Renewable Fuel Standard, LCFS credits under California’s Low Carbon Fuel Standard, and Verified Emission Reductions (VERs) under voluntary carbon markets. Qualification depends on the RNG’s source, end use, and compliance with program-specific requirements. Accurate monitoring, reporting, and verification (MRV) protocols are essential to ensure credit integrity. Project developers must complete rigorous certification processes to generate legitimate and tradable credits.

Conclusion

RNG credits support climate goals by incentivizing CH4 capture and renewable fuel use. For developers, operators, and investors, understanding the requirements and crediting pathways is essential to fully monetize RNG projects and maintain regulatory compliance. Programs like the RFS, LCFS, and voluntary carbon markets offer opportunities to generate revenue while reducing GHG emissions.

With the right technology and proper certification, RNG projects can play a critical role in sustainable energy strategies. Cimarron’s suite of mitigation and control technologies provides proven solutions for capturing and utilizing biogas safely and efficiently.

For more information, visit www.cimarron.com or contact us at sales@cimarron.com.