- The Strathmore Plant generated an estimated $377,667 in revenue from electricity sales during 2020 with a 74% gross margin
- The cold week of January 12th to 18th saw peak power production pricing for the year with an average power price of $405.65/MWh and power prices above $900/MWh 24% of the time during that week
- Once fertilizer production restarts, electricity production is expected to continue to generate an important secondary stream of revenue
Toronto, ON (GLOBE NEWSWIRE) - EarthRenew Inc. (CSE:ERTH) (“EarthRenew”, or the “Company”) is pleased to announce a successful power generation year in 2020. The power generation facility at EarthRenew’s Strathmore, Alberta facility (the “Strathmore Plant”) is capable of generating up to 4 MW per hour by using low-cost natural gas to run the Rolls Royce turbine. In 2020, EarthRenew generated 1,500 MWh of electricity which it sold to the municipal grid for an estimated $377,667 in electricity sales revenue. The direct costs to run the turbine throughout 2020 were $99,400. Due to its operation as a peaking plant (whereby electricity is only supplied by the plant to the electrical grid if certain minimum power price thresholds are met), the Strathmore Plant was able to generate a 74% gross margin on electricity production.
This electricity was delivered to the Alberta grid taking advantage of significant price peaking on the grid. The pool price for electricity reached $999.99 per MWh in January 2020, fueled by a drastic dip in temperatures in the province. Over the last year, the average power price was $46.75/MWh as reported by the Alberta Electric System Operator (AESO).
The months of January, July and October 2020 were particularly profitable for the Company, with peaking electricity demand resulting from cold and hot weather extremes. The Strathmore Plant generated $176,192 in January 2020, $70,093 in July 2020 and $107,225 in October 2020.
CEO Keith Driver commented, “The results from electricity sales over the last year indicate that we have been successful in our operations for the facility as a peaking plant. We intend to continue to operate the facility as a peaking plant until we recommission our existing operations. Once fully recommissioned, the Strathmore Plant will only require approximately 1.5 MW of the 4 MW capacity we have available from the turbine so selling the excess electricity to the grid on a peaking basis or to an onsite user such as a co-located agriculture facility represents an important secondary revenue stream for an EarthRenew facility. Right now, the revenue we generate from electricity sales helps to offset costs as we move towards restarting fertilizer production.”
EarthRenew’s mission is to support a farm system that puts healthy soils and grower profitability back on the table. EarthRenew transforms livestock waste into a high-performance organic fertilizer to be used by organic and traditional growers in Canada and the United States. Located on a 25,000 head cattle feedlot, our flagship Strathmore plant is capable of producing up to four megawatts (MW) per hour of low-cost electricity powered by a natural gas fired turbine. The exhausted heat from the turbine is used to convert manure into certified organic fertilizer.
Cautionary Note regarding Forward-Looking Information
This press release contains "forward-looking information" within the meaning of applicable Canadian securities legislation. Forward-looking information includes, but is not limited to, statements with respect to the estimated revenue generated by the Strathmore Plant, the business and operations of the Company, and the Company’s ability to execute its business plan, including its intentions with respect to recommissioning the Strathmore Plant, restarting fertilizer production and operating the Strathmore Plant as a peaking plant. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information, including but not limited to: general business, economic, competitive, geopolitical and social uncertainties; regulatory risks; and other risks of the energy and fertilizer industries. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. The Company does not undertake to update any forward-looking information, except in accordance with applicable securities laws.
Neither the Canadian Securities Exchange nor its Market Regulator (as that term is defined in the policies of the Canadian Securities Exchange accepts responsibility for the adequacy or accuracy of this release.
© 2021 GlobeNewswire, Inc. All Rights Reserved.