Photo caption: Pathward’s Structured Finance Group funded the construction of plants at two Arizona dairy farms that are now operational. The photograph shows an aerial view of the renewable natural gas facility (foreground) at Butterfield Dairy Farm (background) in Buckeye, Arizona. Photo credit: Avolta
Cow manure is used to make RNG thanks to the new facilities.
In 2022, renewable natural gas (RNG) developer, Avolta, sought a funding partner to build facilities at two dairy farms in Arizona that would turn cow manure into RNG. Following a request for proposal, Avolta selected to work with Pathward®, N.A., a nationally designated U.S. Department of Agriculture (USDA) lender.
“Pathward demonstrated extensive industry knowledge and had a credible reputation as a top USDA lender, and they offered creative and flexible finance solutions that made their proposal the best fit for our projects,” said Avolta Co-Founder Gov Siegel.
Pathward is committed to investing in environmental sustainability opportunities (an Environmental, Social and Governance strategic area of focus), and its Commercial Finance business line puts a special emphasis on funding alternative and renewable energy projects, helping the company meet unfilled needs in that area, particularly in the solar and biogas sectors.
Avolta’s projects were among those loans where Pathward’s Structured Finance Group worked closely with the customer to provide one-stop solutions for construction and permanent financing for two large RNG plants, that, according to Avolta, can handle waste streams from more than 60,000 dairy cows. These facilities ultimately create RNG from organic materials, such as cow manure, providing environmental and financial benefits.
Avolta announced that the projects can capture most of the methane the cows produce, reducing carbon emissions equivalent to removing 8,000 cars from the road each year. They also can eliminate the consumption of 4 million gallons of fresh water per day from the aquifer through water treatment systems and closed-loop recycling processes. In addition to providing environmental benefits, Avolta shared that the project created hundreds of construction jobs within the community and will continue to provide supplemental income to the dairy farms hosting the facilities.
The RNG plants funded by Pathward capture most of the methane the cows produce and reduce carbon emissions equivalent to removing 8,000 cars from the road each year, according to Avolta. Photo credit: Avolta
In March of 2023, Pathward joined Avolta and other partners to celebrate the ribbon-cutting of the two new facilities in Arizona. In its news release, Avolta highlighted measurable benefits and stated:
“The projects have begun injecting RNG into the Southwest Gas pipeline for distribution. Avolta has partnered with U.S. Gain to distribute the RNG as an ultra-low carbon transportation fuel in California and other LCFS (Low Carbon Fuel Standard) states, generating both RINs (under the Renewable Fuel Standard) and LCFS credits (under the California Air Resources Board).”
The membrane skid is a portion of the upgrading equipment necessary to treat the gas at the Butterfield Dairy facility. Photo credit: Avolta
Pathward’s Vice President of Alternative Energy Finance, Jon Ellis, attended the ribbon-cutting events.
Ellis shared, “The RNG projects at the Arizona dairy farms demonstrate the type of projects in the renewable energy marketplace that Pathward can help bring to life through our flexible capital solutions. Pathward is a market leader committed to financing alternative energy projects that a lot of other banks are not able to finance, and we are honored to have been selected to collaborate with Avolta to bring these projects to fruition.”
Siegel added, “Pathward has been great to work with, and we appreciate their creativity, support and partnership through the entire process.”
The number of stakeholders required to successfully deliver these projects was extensive, including the dairies, Avolta, investors, numerous equipment manufacturers, the construction contractor, Southwest Gas, and U.S. Gain. With Pathward’s financial stewardship, Avolta shared that the new facilities inject ultra-low carbon fuel into the natural gas pipeline for use in the transportation sector, helping the state work toward stringent emissions goals. Additionally, Avolta stated that the projects have provided the dairies with optimized waste management solutions, new revenue streams and significant carbon emission reductions.
Pathward’s Commercial Finance business line has flexible payment options that assess a business’ risk based on account strength and volume rather than total revenue. The flexibility and creative solutions Pathward offers allow it to work closely with businesses to solve their finance needs outside of traditional commercial loans.
Pathward’s Commercial Finance products include working capital, equipment finance, structured finance and insurance premium finance solutions, encompassing both conventional and government guaranteed lending. With representatives across the country and in Canada, Pathward helps industries nationwide including transportation, manufacturing, staffing, renewable energy, insurance agencies, technology, oil and gas services, construction and distribution.
Pathward®, N.A., a national bank, is a subsidiary of Pathward Financial, Inc. (Nasdaq: CASH). Pathward is a U.S.-based financial empowerment company driven by its purpose to power financial inclusion. Pathward strives to increase financial availability, choice and opportunity across our Banking as a Service and Commercial Finance business lines. The strategic business lines provide end-to-end support to individuals and businesses. Learn more at Pathward.com.
Avolta is an execution focused developer of renewable natural gas projects that brings a full suite of capabilities to project development including identifying potential development targets, performing financial and operational due diligence, securing gas rights, obtaining off-take agreements for gas and environmental credits, and project financing. Avolta and its partners remain involved throughout the development life cycle of a project including managing ongoing operations. This approach provides new economic opportunities and reduces the impact on the environment for years to come. Learn more at www.avoltadevelopment.com.