Synthica Energy receives major investment from Goldman Sachs

Synthica Energy LLC, Blue Ash, Ohio, an energy transition platform that aims to design, build, own and operate large-scale, contracted anaerobic digestion (AD) facilities to convert pre-consumer organic waste into renewable natural gas (RNG), has announced that it has closed on a large equity investment from the Infrastructure Business division of Goldman Sachs Asset Management, New York City.

Financial terms of the deal were not disclosed.

The new capital will enable Synthica to expand its infrastructure projects and accelerate the development of its facilities in key target markets across the country, including Ohio, Texas, Georgia, Kentucky and Louisiana in the near term. During the coming years, Synthica also plans to develop clean energy facilities in Florida, Illinois, Missouri, New York and Pennsylvania.

“Synthica’s mission is to provide a critical service for hard-to-process organic waste streams, divert these materials away from landfills and other non-sustainable disposal outlets and ultimately reduce carbon and methane emissions,” Synthica CEO Sam Schutte says. “We are excited about partnering with Goldman Sachs since it will enable us to accelerate our project development pipeline, enhance our circular solutions for our customers, and supply RNG to meet the growing market demand.”

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Founded in 2017, Synthica aims to produce RNG from pre-consumer food and beverage waste and other organic manufacturing byproducts. Distinct from many existing RNG developers, which largely focus on dairy products from farms or mixed solid waste from landfills, Synthica’s infrastructure business model focuses on processing pre-consumer organic waste.

Synthica supports a green energy transition by aiming to provide a circular waste management solution at convenient facilities located a short drive away from city centers and repurpose pre-consumer organic waste, which might otherwise be disposed of in a landfill where it would create greenhouse gas (GHG) emissions. Through anaerobic digestion, Synthica plans to convert this organic waste into RNG that can be used for a variety of drop-in fuel purposes in place of fossil fuels and help customers or offtakers achieve their decarbonization targets and sustainability goals, including with respect to recycling and landfill diversion.

The company’s focus on pre-consumer organic waste gives Synthica access to a large, stable supply of input material from major food, beverage and industrial manufacturers. The company enters into contracts to accept customers’ waste as feedstock, providing a low-cost, proximate, sustainable alternative to landfill disposal. Unlike post-consumer waste, which can vary in supply and contamination levels, pre-consumer waste streams enable greater efficiency and consistency in the production of RNG.

Co-founders, Schutte and Chief Development Officer Grant Gibson will continue to lead the firm. Mark Weidman, a leader in the waste-to-energy sector and former CEO of Wheelabrator Technologies Inc., will serve as executive chairman.

“With this investment, we are aiming to take waste out of a one-way system and recycle it to generate renewable energy,” says Cedric Lucas, a managing director in the Infrastructure Business within Goldman Sachs Asset Management. “Similar to our Verdalia investment in Europe focused on biomethane, we believe this sustainable process can provide dual benefits, helping businesses and municipalities beneficially reuse their organic waste and supplying the country’s utilities with RNG, critical for reducing their carbon footprints. We are thrilled about the opportunity to partner with Sam and Grant and leverage the capabilities and relationships of our firm to bring sustainable infrastructure solutions to cities across the U.S.”

Demand for RNG and other renewable resources in the U.S. is expected to grow rapidly for the foreseeable future as utilities and manufacturers continue their efforts to reduce GHG emissions by decarbonizing their heating and power generation. Synthica plans to sell its RNG production under offtake contracts with gas utilities, energy majors and industrial purchasers.

Synthica recently broke ground on its first facility in Ohio in St. Bernard which will process 500 tons of food waste per day. The facility is expected to divert a significant amount of organic waste from local landfills and sewers each year, removing CO2 and methane emissions from the atmosphere.

Goldman Sachs Asset Management provides clients around the world with a dedicated partnership and focus on long-term performance with more than $2.7 trillion in assets under supervision worldwide as of June 30.