Friday, May 27, 2011

Biogas firm plans 200-job facility - Toronto Star

Ontario is placing a $16 million bet on a clean water and energy company that plans to set up its global headquarters in the province.

Anaergia Inc. will set up a head office, research and manufacturing facility to produce biogas equipment, which turns products such as sewage sludge and farm waste into energy.


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The province will provide Anaergia a grant of $8.08 million and a loan of the same amount – interest-free for five years – to help finance the $70 million facility.

Anaergia’s chairman and chief executive Andrew Benedek said the company hasn’t yet decided where to locate the new facility.

It will employ about 200 people once it’s up and running, Benedek said in an interview.

Operating mainly under the name UTS Biogas, the company has operations in Germany, where Benedek says its equipment is used in about 1,600 biogas plants.

It also has operations in California, where Benedek lives.

But he’s still a Canadian citizen, who began his career as a chemical engineer at McMaster University.

Benedek founded Zenon Environmental, a water purification firm, that he eventually sold to GE Power and Water.

German green energy policies then drew him across the Atlantic, and U.S. clean energy programs then drew him to California, he said.

He only recently learned about Ontario’s Green Energy Act when he was invited to sit on an energy advisory panel in the province, Benedek said.

He found the province’s renewable energy policies are very similar to those in Germany. One of them is the province’s feed-in tariff program, which offers steady, above-market prices for power produced from renewable sources.

“Like most Canadians who leave Canada, we tend to forget how good it is here,” he said.

Benedek says there’s plenty of research to do in the biogas sector.

“The industry, in my view, is still in its infancy,” he said. “It has not evolved technologically. I really see an opportunity to become far away the leader of the world,” he said.

“What we want to do is bring the cost down so we can afford to compete with other forms of energy.”

Electricity produced from biogas is priced at 10.4 cents to 19.5 cents a kilowatt hour under current feed-in tariff rates, while the wholesale market price hovers around 4 cents a kilowatt hour.

Anaergia is privately held and doesn’t release financial statements, but Benedek said its annual revenue is about $70 million .

“It’s not a big number, but it’s one of the biggest in this narrow space, and it’s going to be much bigger by the end of this program,” he said.

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