Kraft Heinz cancels US biogas & decarbonisation project following federal policy shift

A high-profile industrial decarbonisation project in the United States that included significant biogas integration has been cancelled following a shift in federal energy policy.

The initiative, led by global food manufacturer Kraft Heinz, was previously awarded $170 million (approx. €158 million) in funding through the US Department of Energy’s Office of Clean Energy Demonstrations.

The funds were intended to support the installation of biogas systems, solar power and heat pump technology across 10 manufacturing facilities in states including Illinois, Ohio and Virginia.

However, this support has now been withdrawn, as part of a broader $3.7 billion (€3.44 billion) cancellation of clean energy demonstration projects.

The decision, announced by US Energy Secretary Chris Wright, affects more than two dozen projects primarily focused on carbon capture and industrial decarbonisation.

Wright said the previous administration had failed to carry out a detailed financial review before committing taxpayer funds. The current administration is now reassessing clean energy investments to prioritise projects with a higher return on investment and stronger alignment with national energy security goals.

Kraft Heinz had already received an initial $5.9 million (€5.5 million) grant disbursement in late 2024. The full project was intended to help the company cut natural gas consumption by 97% and reduce total energy use by 23% by 2030, in line with its goal to achieve net-zero greenhouse gas emissions by 2050.

In response to the decision, Kraft Heinz stated it would continue to invest independently in its operations.

“This decision does not change our intention to continue investing in our 30 US manufacturing facilities,” a spokesperson said. The company plans to invest $3 billion (€2.79 billion) over the next five years in supply chain modernisation.

The funding reversal also affects other industrial players, such as steel producer Cleveland-Cliffs, which has said one of its clean energy projects will likely undergo significant changes. Some initiatives may proceed with private funding, but many are expected to be delayed or restructured.