Goldman to invest over $1bn in biomethane

Goldman Sachs Asset Management has announced the creation of a new biomethane business called Verdalia Bioenergy. The company plans to invest over 1 billion euros in the European biomethane market over the next four years.

Biomethane, a clean alternative to natural gas made from the breakdown of organic waste, is considered a critical component in reducing carbon emissions in the European Union. The EU requires 80 billion euros in investment to increase production of biomethane and biogas tenfold, reaching a target of 370 terawatt hours per year by 2030. This move is aimed at accelerating decarbonization and enhancing energy security.

Verdalia Bioenergy will invest in early-stage biomethane development projects and existing assets with the goal of supporting the EU’s decarbonization and energy security objectives. The company has already agreed to acquire a portfolio of biomethane projects in mid-stage development in Spain with a total capacity of 150 gigawatt hours per year.

“We believe that biomethane is a significant opportunity for infrastructure investors in the energy transition,” said Matteo Botto Poala, a Managing Director in GSAM’s infrastructure business. Biomethane can be utilized like natural gas and distributed through the same infrastructure, but with much lower carbon emissions.

According to the European Biogas Association, biomethane and biogas production has already generated 210,000 green jobs in Europe and reduced greenhouse gas emissions by 60 million tons annually.