Xergi, a biogas company based in Denmark, has signed a contract with the Minnesota Municipal Power Agency (MMPA) for the establishment of a plant in Le Sueur, MN.

Hometown BioEnergy will produce methane gas from agricultural and food processing wastes such as sweet corn silage, potato waste and chicken manure. The gas will then be burned to create up to 8 megawatts of electricity for powering homes and businesses in Le Sueur. A byproduct will be sold as liquid fertilizer to local farmers, and undigested biomass will be dried and sold as an alternative fuel for coal-fired power plants.

The plant will be a partnership between MMPA and Avant Energy, Inc. Xergi will design it, provide key components and assist during construction and startup.

“This project is an important asset for MMPA and is a very natural fit for agricultural areas such as Minnesota,” says Kelsey Dahlen, project director. “Hometown BioEnergy will help MMPA meet the state-mandated requirement to provide 25% of our electricity from renewable sources by 2025.”

Construction is expected to start in 2012.