Idaho-based Sevana Bioenergy acquired the Rialto Bioenergy Facility in California, the buyer announced Thursday. Sevana bid $20 million for the facility at auction after a subsidiary of Anaergia filed for bankruptcy in May of last year, per court filings.

"The Rialto Bioenergy Facility is a strategic asset that aligns perfectly with Sevana Bioenergy’s mission to accelerate the production of RNG," said Sevana CEO John McKinney in a statement. "This acquisition strengthens our presence on the West Coast and allows us to continue playing a vital role in helping California achieve its ambitious renewable energy and waste diversion goals."

The Rialto Bioenergy Facility can process up to 700 tons of food waste and 300 tons of biosolids per day, Ontario-based Anaergia announced when it first developed the location. But it’s struggled since the company completed the facility in 2020. While Rialto was initially poised to benefit from a steady stream of source-separated organics from the Los Angeles metro area spurred by the state’s SB 1383 law, pandemic-related pauses and delays in that program hamstrung the facility.

Publicly traded Anaergia removed Rialto from its earnings report for the second quarter of 2023, spinning it off into a subsidiary which filed for bankruptcy on May 25 of that year. By last fall, the company had retained Jefferies to explore a sale.

The Chapter 11 bankruptcy placed restrictions on Rialto even as Anaergia continued to operate it, said Yaniv Scherson, chief operating officer of Anaergia. He said the facility could not scale up its intake of feedstock even if that material was available due to concerns from lenders.

For the month of April, Rialto reported a cash balance of about $15 million and a gross income of about $54,938, according to a monthly operating report filed with the bankruptcy court in late May. Since September, the facility has recorded a cumulative net loss of about $42.9 million, per the filing.

Sevana will acquire most of the assets at the Rialto property, where it plans to “gradually ramp up throughput and RNG production,” per a release. The city of Rialto owns the land underneath the property.

The Ontario Teachers’ Pension Plan acquired a majority stake in Sevana in March 2023, announcing a $250 million capital commitment to grow the company’s renewable natural gas investments. The company claims it is “developing multiple biogas projects in agricultural regions of North America,” according to its website.

Anaergia had supplied three OREX extrusion press machines that service the facilities and are owned by haulers, according to Scherson. He said Anaergia is ready to continue supporting the operation of those machines and Rialto as the owners see fit.

While Anaergia has moved away from built, owned and operated assets, it continues to operate another large digester in Rhode Island and other facilities. The company has yet to file an annual report for 2023, and expects its annual meeting will occur in late July. 

Anaergia also continues to operate in California, including at a wastewater treatment facility in Victorville. Scherson said the company is still open to opportunities in the state, where he believes conditions are improving in the organics space.

“It's delayed and it's sluggish but it's growing for sure,” Scherson said. “It's a positive story at the end of the day. The state's largest food waste digester continues.”