State Invests $3 Million to Convert Forest Waste into Carbon-Negative Fuel Development

​​​April 18, 2023

SACRAMENTO - California announced $3 million in awards to jumpstart innovative technologies designed to convert biomass to carbon-negative energy, which will also improve forest health, reduce wildfire risk, and improve the state’s watershed in the Sierra Nevada.

Housed in the California Department of Conservation, the Forest Biomass to Carbon-Negative Biofuels Pilot Program made six $500,000 awards to applicants within the Sierra Nevada region with projects that demonstrate technologies and plans for the creation of energy from Sierra Nevada-sourced forest biomass to help offset the use of fossil fuel, improve forest and community resilience, and create regional economic opportunities.

“This seed funding, which could treat up to 70,000 acres of Sierra Nevada forest, will yield impactful environmental benefits from materials that might otherwise be left in the forest to decompose or contribute to future wildfires,” Department of Conservation Director David Shabazian​ said. “This program is instrumental to achieving California’s climate goals and embodies the goals of our department to improve watershed function, reduce hazards, achieve carbon neutrality and foster sustainable economic development.”

Selected projects focus on “woody biomass waste” – treetops and branches, undergrowth such as shrubs and other forest litter collected for wildfire mitigation. Removal of this waste reduces the risks to public safety or infrastructure, creates defensible space and supports other forest restoration projects. However, most often this material is simply collected and then burned, or left to decompose, both actions resulting in increased greenhouse gas emissions. Funded projects are meant to show how this waste can become an asset in California’s drive toward alternative energy and climate resilience. The program also showcases California’s embrace of advanced technology and business development to tackle climate challenges and opportunities.  

The Forest Biomass to Carbon-Negative Biofuels Pilot Program is funded by a $50 million budget allocation made in 2022. The Department of Conservation is administering the program in close coordination with the California Energy Commission and the California Air Resources Board, as well as other state entities sharing similar climate goals. 

“We are pleased with the broad geographic representation and diversity of the applicants, and we look forward to partnership with the awardees,” said Shabazian.

The program’s first six grantees and projects are:

  • Arbor Energy and Resources Corporation: The Arbor Biomass Gasification Facility in Auburn (Placer County) will use the funding to support development of a next-generation Biomass Carbon Removal and Storage system that converts woody waste into hydrogen and then utilizes that product to create carbon-negative electricity. Based on rocket engine technology, the Arbor system allows for the usage of a wide array of biomass. Arbor’s first facility will annually utilize around 30,000 tons of unmarketable forest material from the American River watershed, as well as the surrounding region, and capture more than double that amount of carbon for permanent removal. The Placer County Water Agency will use the carbon-negative energy generated by the process – which will include material created from its own sustainable forest management operations – at its Auburn water treatment plant.
  • Biogas Energy, Inc.: Placer Biomass-to-Fuel Facility project in Truckee​ (Placer County) will produce fuel from forest waste at Placer County’s Cabin Creek material recovery facility. With assistance from the county, this development project will explore thermochemical conversion of forest cuttings, slash (woody debris generated during logging operations natural forest disturbances such as wind and snow) and other waste biomass to produce ultra-low carbon fuel for California’s transportation sector.
  • Mote, Inc.: Sacramento Carbon Negative Hydrogen Project 1 in El Dorado Hills (El Dorado County) is a partnership with Sacramento Municipal Utility District for a first-of-its-kind biomass gasification facility with integrated carbon capture and geological sequestration. Once operational, the facility will produce carbon-negative hydrogen for thermal power generation and transportation. Annually the project will process approximately 330,000 tons of wood biomass to create more than 21,000 tons of hydrogen, and geologically sequester more than 400,000 tons of carbon dioxide, removing massive amounts of carbon from the air.
  • Sierra Institute for Community and Environment: Nor Cal Waste to Renewable Hydrogen in Crescent Mills (Plumas County) is a partnership with clean energy company SGH2 Energy Global Corporation to build a gasification facility on Sierra Institute’s Indian Valley Wood Utilization Campus. The facility will consume forest restoration byproducts and produce carbon-negative liquid hydrogen fuel at a commercial scale.
  • Yosemite Clean Energy, LLC.: The Yosemite Clean Energy Paradise Biomass to Carbon Negative Fuels Plan Oroville (Butte County), or “Paradise Plant,” involves the development of a 50-megawatt forest waste biomass to hydrogen plant. Once operational, the plant will process more than 90,000 dry tons of forest waste biomass annually. This will contribute to Butte County’s forest watershed management goals, support California’s transportation carbon neutrality goals by generating a carbon negative fuel source and boost the local economy by creating more than 55 jobs within the Oroville area.
  • Yosemite Clean Energy, LLC.: The Yosemite Clean Energy Sierra Biomass to Carbon Negative Fuels Plant in Chinese Camp (Tuolumne County), or “Sierra Plant,” will also develop a 50-megawatt forest waste biomass to hydrogen plant that, once operational, will process more than 90,000 tons of forest biomass annually. The Sierra Plant will also support Tuolumne County and the State of California’s annual forest management goals, support transportation carbon neutrality by generating a carbon negative fuel source and boost the local economy by creating more than 55 jobs.

The Department of Conservation ​is finalizing contracts for two other grants that will be awarded in May. Nineteen applications were received for first-round funding.

“California’s goal is to achieve carbon-neutrality by 2045,” Shabazian said. “Alternative energy production and capturing carbon are key components of the strategy.” 

Phase 2 of the Pilot Program will include construction of facilities that will convert Sierra Nevada forest biomass waste into carbon-negative energy. Grants awards for that second phase are expected in 2024. 


​Public Affairs Office​