Economic Perspective for Renewable Natural Gas from Food Waste

In Malaysia, 45 % of total municipal solid waste is food waste in which government has mandated Act 672 to enforce food segregation approach for several states in Malaysia. Nevertheless, the segregated food waste is still not fully utilized and stick with the current practice of waste disposal. This practice leads to significant methane emissions, environmental pollution, and rising landfill management costs. To address this issue, conversion of food waste to Renewable Natural Gas (RNG) using anaerobic digestion (AD) serves as promising solution to produce clean energy substitute for natural gas. Life Cycle Cost Analysis (LCCA) and Levelized Cost of Methane (LCOM) is performed in this study to evaluate economic viability for two different RNG pathway which are RNG injection into the gas grid pipeline and RNG distribution via virtual pipeline (Bio-CNG). The system boundary includes the entire chain of RNG from food waste collection to RNG end-utilization. Based on this study, RNG injection into the gas grid pipeline presents the lowest annualized cost at 43.2 million MYR/y with an LCOM of 29.81 MYR/MMBtu, while the Bio-CNG pathway incurs higher costs at 64.1 million MYR/y and an LCOM of 44.23 MYR/MMBtu. Compared to the current fossil-based natural gas price of 40.34 MYR/MMBtu, RNG injection to gas grid pipeline shows competitive cost in replacing current natural gas. With additional support by government incentives, carbon credits, and green certificates, RNG production from segregated food waste will be the most viable option in solving the food waste accumulation issue while be competitive with current fossil-based natural gas in the market. This study will give valuable insights for policymakers and industry stakeholders in driving sustainable waste-to-energy strategies, enhancing food waste valorization, and advancing Malaysia’s net-zero emission agenda.