Waste Not, Earn More

Deborah R. Huso, Contributor

When Steve Reinford and his son, Brett, decided ‌to invest in an anaerobic digester for the ‌family dairy operation in Juniata County, ‌‌Pennsylvania, in 2008, the two had different reasons for pursuing the technology. Making money wasn’t necessarily one of them, but it has been a welcome side benefit.

Brett, who serves as Reinford Farms’ office manager, wanted his parents’ 700-cow dairy to become more sustainable and, with the manure it produces, generate its own renewable energy. “Digesters were fascinating to me because you’re using a waste source on the farm and turning it into energy,” he says.

Steve Reinford liked the idea of controlling the odor from the cows’ manure, which was increasingly drawing complaints from nonfarming neighbors. “At the time, we didn’t know what all the digester could do,” Brett adds. “What really sold it was the odor reduction.”

Fast-forward a decade, and the Reinfords’ 1,000-cow RCM Complete Mix digester has not only increased the dairy’s sustainability but has become a critical source of income.

HOW IT WORKS. The digester at Reinford Farms processes about 12,000 gallons of manure per day. Skid loaders with scrapers in the free stalls and cow barn scrape manure into a gravity pipe that feeds into the digester. Manure remains there for 20 days at 100ËšF, a perfect temperature for bacteria to produce methane.

The digested manure is separated into solids, which the Reinfords use for bedding and a liquid they use for fertilizer on their 1,200 acres of row crops. The gas produced is 60% methane, with the remainder comprised of sulfur compounds and other gases. It is drawn from the top of the manure to a generator located next to the barn and milking parlor, itself. The gas produces 140 kilowatt-hours (kWh) of electricity per hour around the clock, or about 1.2 million kWh per year.

The Reinfords use about a third of that electricity on the farm; they sell the rest to the local power company. The Commonwealth of Pennsylvania has a law that requires power companies to buy energy from alternative sources at retail cost, so the Reinfords get a check once a year from PPL Electric Utilities in exchange for the electricity they produce. Brett explains that check runs around $20,000. Plus, Reinford Farms no longer has to purchase electricity, which would today cost them $5,000 per year.

Waste heat from the generator’s engine coolant and exhaust heat the farmhouse, shop, hot water in the milking parlor, as well as the milking parlor. It also provides heat for grain draining and pasteurizing milk for calves. The excess heat used to warm the milking parlor’s hot water has saved the farm 200 to 250 gallons of fuel oil per month. The Reinfords also dried 25,000 bushels of corn with this on-farm-produced heat. It would have cost the Reinfords 40 cents per bushel to have someone else do the drying. That saved the farm $10,000 in drying costs.

“We expected an eight- to nine-year return on investment when we built the digester because of the electricity it would produce,” Brett explains, “but we got a return in about two years. In 2009, this thing kept us in business.”

IMPRESSIVE INVESTMENT. Anaerobic digesters can be expensive. The Reinfords’ facility cost $1 million. Two USDA grants covered about 60% of those costs. Additional funding came from the Commonwealth
of Pennsylvania.

Payback has evolved. The Reinfords haven’t been seeing the same profits they experienced the first five years of operating the digester because of equipment wear and high maintenance costs. They are in the process of building a second digester four times the size of the first. The new unit will feature a scrubber to clean the gas moving into the generator, reducing some of the expenses for wear and tear resulting from the hydrosulfuric acid produced by combustion.

Brett says about 70% of the cost will be covered by grants and tax credits offered by the Natural Resources Conservation Service and a Commonwealth Financing Authority grant from Pennsylvania. About a third of the digester’s cost will essentially be refunded through a federal tax credit.

In addition to manure digesting, Reinford Farms has been accepting food waste for about 10 years. They obtain an average of 50 tons per day of product from grocery stores, which, Brett says, produces about three times more gas than manure. They recently added a facility to the farm that allows them to take packaged food waste, too. The food waste business is competitive. About 30 farms surrounding Reinford Farms can also process it.

“It’s a bigger revenue generator than selling electricity back to the grid,” Brett says. However, he wouldn’t recommend a farmer build a digester based on assumptions about income from food waste alone.

VIABLE VOLUME. Kevin Erb, director, Conservation Professional Training Program, with the University of Wisconsin Extension, in Green Bay, cautions producers must understand what’s involved in operating a digester. “You’re going from managing cows to produce milk to managing bacteria to produce gas,” he says. “You need a certain volume to make it economically viable.” While he acknowledges he’s seen farms with small digesters for 200 or so cows, it’s rare to see them on farms with fewer than 1,000 milking cows.

Bill Rowell, who operates a 900-cow dairy with his brother Brian, near Sheldon, Vermont, runs two 300 kWh generators that produce 2 million kWh of electricity annually from their Green Mountain Dairy’s anaerobic digester. The units cost $2.75 million. However, the Rowell brothers benefited from a $335,000 USDA grant, as well as from grant money through a manure-management program sponsored by the state and by a Vermont Clean Energy Development Fund program. In total, the grants covered $750,000 of the project costs.

Even so, as Bill points out, “you need an economic driver anytime you do something like this.” For Green Mountain Dairy, it was Vermont’s Standard Offer Program, which pays out 14.1 cents per kWh for the farm’s electricity, as well as the state’s Cow Power program, which pays an additional 4 cents per kWh for renewable energy. The farm has contributed 1.8 million kWh per year to the grid for the last 10 years.

When the Rowell brothers take into consideration the profit from electricity generation, as well as funds saved by producing their own fertilizer and bedding, and their use of waste heat in farm buildings, Bill says the digester grosses them about $500,000 annually. They also use a dragline to pump manure out to their fields.

“If you ask me about farming without a digester, we wouldn’t be very interested,” he continues. “We like what it does. We wanted to be able to handle a large waste stream in the most efficient, meaningful way possible.”

LESSONS LEARNED:While an anaerobic digester might come across as a no-brainer investment for a large dairy (assuming one can support the cost with grant funding and tax credits), dairy producers who have done it offer advice to those interested in trying this technology:

> DO YOUR RESEARCH. “There are a lot of different companies that manufacture digesters,” says Brett Reinford. “But, there are only two or three that work well and have good service.” The Reinfords use Martin Construction Resource LLC (formerly RCM Digesters), and Green Mountain Dairy uses DVO Inc.

> THE FEWER PUMPS, THE BETTER. “They are the parts that wear out most quickly,” Reinford explains. “If you can use gravity flow, that’s better.”

> SIZE FOR THE FUTURE. “We built our digester for 1,000 cows, but we maxed it out in a couple of months,” Reinford notes. “Be prepared for growth.”

> PLAN THE BEST LAYOUT. The Reinfords built their first generator right next to the milking parlor so it would be close by for heating water and the shop.

Realize operating an anaerobic digester and associated systems can be a full-time job. University of Wisconsin’s Kevin Erb says you’ll need at least one person whose primary responsibility is the digester.

> SIGN A POWER AGREEMENT. Erb says you don’t want to get knocked out of receiving payments from your utility when a better renewable energy source comes along. Unlike Pennsylvania, many states don’t require utility companies to pay retail for alternative electricity generation.

> DON’T EXPECT FOOD WASTE TO FINANCE IT. Reinford says you’ll be competing with other farmers, as well as with landfills and composters. “It’s best to pencil it out based on electricity and fertilizer [transportation] savings,” he advises.

> SUSTAINABILITY WILL BE LIMITED. “For every million gallons going in, 999,000 gallons are going out,” Erb explains. “You’re merely changing the form of the nutrients.” In other words, you’re not going to save your local watershed. But, you will make more substantial use of waste material for productive purposes.

The EPA offers resources for farmers interested in building and installing anaerobic digesters

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