Manure Monday: Anaerobic Digestion

Manure Monday: Anaerobic Digestion

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Alright. Today's topic is anaerobic  digestion. Certainly it's been a topic that   i think we've talked a lot about in the world of  manure for probably 40 to 50 years. Now I think   the first time this got really popular was in  the 1970's and then I think there was quite a   bit of popularity again in the 1990s and we're  seeing a fair amount of interest once again,   so I'll try and give a brief presentation on what  some of the basics about anaerobic digestion are   and then try and talk through some of why maybe  we're seeing a lot of interest again right now.   Hopefully Gabby will get here. If she doesn't  no matter what, we will give you a presentation   on some economic modeling we did for Iowa  specific conditions about what it might   take for anaerobic digesters to look feasible  and hopefully that'll give some insight into   why people are asking a lot  of questions about them again.  

So as always, if you have any thoughts, questions,  something you want to add at any time feel free   to unmute or type into the chat box we always  look forward to hearing what you have to say. So anaerobic digestion, so the process overview  at least how we're going to think about it is   we're going to start with our manure right and all  the good stuff that contains maybe some pathogens   in there as well. Lots of macronutrients in  particular things like that carbon that's in there   that's what we really want nitrogen, phosphorus,  potassium, sulfur and then micronutrients as well   that the bacteria need. I mentioned that carbon,  but those unstable organic materials and that's  

really when we talk about anaerobic digestion  what we want - that carbon in our whatever   material we're working with whether it be manure  or biomass is what we're going to try and convert. Put that into some sort of container, get a  consortium of microorganisms to work on it.   If we compare this maybe with some other  technologies that we've seen more recently that   people have been working on cellulosic ethanol.  For instance with cellulosic ethanol production,   we're really looking at one specific type of  microorganism to try and do our conversion.   One of the big advantages of anaerobic  digestion is it's this consortium of bacteria,   so we don't need to worry at the same level  about sterilization - getting things clean and   obviously in the world of manure that is important  to us. This can have some drawbacks though, right,  

if it's a consortium of microorganisms, they  all have to work together and try and accomplish   things at the same rate. Sometimes that can  be a little harder to accomplish than others.   For instance, if we were feeding just manure every  day and all of a sudden have an opportunity to   take some substrate that some processing  company near us is trying to get rid of,   let's say food processing waste, and we slug a  bunch of that in it can make our microorganisms   really unhappy and that is often how we get  upsets to our digester, where we might see   a good gas production right after we put it in  and then all of a sudden it really falls off.   So it is a team game that makes the biology of  the system a little bit more complicated, but   for the most part there's some resilience there,  where multiple bacteria are trying to do roughly   the same process. So they don't like big changes  quickly, but it can work out pretty well for us.   And then traditionally the way this is looked  at one of the major benefits was the effluent   that comes out is treated and stabilized for us.  And that works great when we talk about it as a  

treatment, for instance, maybe it's pathogen-free.  I have trouble thinking we'll ever get the   pathogen free, but most anaerobic digestion  work has shown a good reduction in pathogens.   Pathogens are the number three or four water  quality impairment here in Iowa, so they are   something that might become more important for us  as we're going to talk about in a few months they   might have some impacts on antibiotic resistance  and antibiotic resistant genes and manure. We're   trying to do some work here at Iowa State right  now. Just gearing up for that to really study that   and what we might be able to do about it, but that  might be something that people are interested in.  

That material that comes out often is billed  as nutrient rich; that's something that I think   we'll talk a little bit more detail about  today, because really anaerobic digesters   don't remove nutrients, they don't add  nutrients. Whatever we put in mostly comes out,   so it really depends on what we're feeding  for how nutrient-rich that material might be.   But in some cases it is more amenable to  other treatments or separations to create   a nutrient-dense fraction. And then one of the  more important things is it is often more stable   and that stability can mean something like low  odor in manures. In decaying biological materials   oftentimes much of the odor comes from those  carbon materials that aren't all the way processed   down to CO2 or methane. Certainly there are other  compounds: ammonia, hydrogen sulfide. Anaerobic  

digestion is going to do little to change how  much of those we're dealing with, but it does   impact some of those carbon compounds and with  them it might change some of our sulfur compounds   from organosulfur compounds into  hydrogen sulfide. And by doing that,   most of those compounds, even though we think of  hydrogen sulfide as having a pretty intense odor   for the most part those organic sulfur compounds  tend to be a little stronger in odor. And the same   actually works for nitrogen. While ammonia is  relatively smelly, those amines are actually,   which is the organic form of nitrogen before we  break it down, tend to be a little bit smellier,   a little bit stickier, so by breaking them down  hopefully we don't have quite as much odor.   And then one of the reasons that we've really seen  interest in anaerobic digestion throughout the   years was we're talking about energy generation.  In the 70s and 90s, that typically meant that we   were going to put degenerate on our farm, burn  that methane, and convert it into electricity.  

Right now we're seeing much of the push for  anaerobic digestion occurring because people   may want to compress it and inject it into  the pipeline. There are a couple of reasons   for doing this there is a program called RINs:  renewable identification number. Manure that   has been anaerobically digested and the methane we  generate from it will generate a D3 RIN, which is   effectively the the good RIN or the more valuable  RIN. It says that it is a renewable or cellulosic   material that we were digesting and so that's a  government incentive to basically encourage this.   And while that RIN is nice, it definitely adds  some value to a lot of the projects people are   looking at. California, as it often is, has  been one of the major drivers and why people  

are looking at this sort of technology.  California has a special carbon SIP program,   a low carbon fuel standard, essentially for their  businesses. So if you can connect to the pipeline   and show that you can send gas to California,  where an end user there would buy it, you can get   some extremely nice benefits uh for what the value  is for that credit. For just a point of reference,   the value of the California credit is  somewhere in the neighborhood of seven to ten   times the value of the actual methane that  we're making. So that is a huge incentive   for why people have been starting to look at  at these types of projects and one of the key   reasons for why we might be getting close to  economic feasibility at the current moment.  

Certainly we don't just generate methane,  we do make other gases like carbon dioxide,   hydrogen sulfide, and in order to put it on the  pipeline that biogas needs to be relatively pure,   relatively pure to do that. So, when we talk about anaerobic digestion, we're  probably in the neighborhood of somewhere between   50% and 70% methane. In order to be able to put  it on to the pipeline, we do have to get it to   pipeline quality gas, which generally  means somewhere in the neighborhood of 95%   to 97% pure, depending on the pipeline that you're  trying to inject it to. And certainly the area  

of your country, the region you're in, and the  actual pipeline that you're injecting to all set   some quality standards, but we do have to monitor  all our injection points uh to meet that quality   standard. So one of the more expensive parts of  anaerobic digestion today, just in addition to   having to put a digester on your farm, is really  the biogas cleaning system that you have to put on   and that injection pipeline. We haven't put  in too many injection pipelines. I've been   involved in a couple digester projects where they  have put them in and we're talking somewhere in   the neighborhood of a million to two million  dollars to make that hookup to the pipeline.   So definitely not a cheap investment. Something  that it does take a little time to recoup.   When we talk about the anaerobic digestion  process it occurs in a couple stages.   The first one is hydrolysis so when we're  working with manures or biological materials.  

We often start with really complex, big organic  stuff and we want to break that down into stuff   that bacteria can actually get in their bodies.  So we want to take some of those bigger materials   turn them into sugars, amino acids, and fatty  acids. Coliform bacteria are generally some of   the more involved organisms in that breakdown, but  it is it tends to be the first step. Oftentimes,   with manures, that is the real rate limiting  step, which probably doesn't come as too much of a   surprise right. We've already digested much of the  material once as it went through the animal body,   so what we're left with is a little bit harder to  break down and because it's hard to break down,   it does tend to be the the slower step in  the process. Because of this you might see   people use more sophisticated digester designs. In  practice we haven't seen a whole lot of that yet,  

but some more sophisticated designs where we might  be at a higher temperature for the first stage of   digestion before it goes into a main digestion  unit, or especially as we look towards some more   complex biological materials beyond manure, let's  say corn stover or switch grass or prairie grass,   they might be looking at hydrolysis units where  they're doing pre-treatment before it goes into   the digester. The second stage is acidogenesis;  so that's taking that simple molecules that we   made and breaking them down into ammonia,  carbon dioxide, hydrogen sulfide, and it's   acidogenic bacteria that perform this. And it's  really those two processes that get us started.   Right after that we make acetogenesis and  that's really taking the acids that we make   and trying to turn them into carbon dioxide,  hydrogen, and really short chain VFAs, so acetic   acid, propionic acid, butyric acid, rather than  longer chain carbon compounds. Some people try  

and stop the digestion process roughly there.  Mostly that's been done on the research side   because some of these carbon materials can  be building blocks for more complex molecules   or other liquid fuels. The disadvantage of  that is separation of that stuff is really   hard and one of the huge advantages of AD is by  making a gas product separation from our manure   is really easy, right? It's naturally going to  bubble out get to the surface and be released,   so we get a relatively clean fuel that we don't  have to do a lot of work for separation with.   And then the fourth step is methanogenesis.  And really that's taking the carbon dioxide   that we've generated, reacting it with hydrogen  or taking acetic acid that's floating around in   that digester and having methogenic bacteria  break it down and turn it into methane.

All these steps have to be in balance; if any of  the steps gets too quick we tend to see issues.   For instance, when we take easily degraded  materials, for example food processing waste,   and slug it into our digester, one of the things  that we tend to see happen is the acidogens and   the acetogens work much more quickly, they respond  much more quickly than the methanogens. So we're   going to end up starting to make lots of VFAs.  We'll see those volatile fatty acids accumulate   and just like their name implies, they're an  acid and we'll see the pH of that digester drop.   If the pH drops too far, we'll get what we call  the digester has soured and it takes a long long   time for it to catch up. Most of the time, it  takes some intervention from a person to get   us back on track and the reason that happens is  because methanogens are extremely sensitive and   tend to grow relatively slow. For the most part,  if we operate relatively stable right where we  

add the same amount of food every day, the same  type of food every day, these systems tend to   self-regulate, but if we have some strange event  where we slug loaded something in, we can get a   hang up in the system, right. So if we sour it,  we did a bunch of these steps, made our volatile   fatty acids and then we hang up right there. In  some cases, right, if we're trying to capture   VFAs, some people have tried to encourage that.  Often times that leads to difficulties though. Okay, so what are we making when we talk  about anaerobic digestion? We end up with   two phases coming out, right. This biogas phase  that's what we were trying to create most of the  

times in these energy project projects and  that methane content is typically 55% to 75%   methane. It depends a little bit on whatever  substrate you're starting with and the pH that   you end up sort of operating at. The remainder of  whatever we have in there tends to be mostly CO2,   a little bit of ammonia, and a little  bit of hydrogen sulfide. In some cases,   there will be N2 gas as well, that would  tend to imply that we're leaking something   into our digester as we're feeding, right.  So, if we have something where we have uh  

some gas bubbles in it when we start we  might have some air some N2 in there.   N2 is extremely hard to separate, so oftentimes  people who have put in covered lagoons and try to   do these anaerobic digestion projects, especially  in spring before we start making much biogas,   tend to have a fair amount of N2 in their gas.  Since it is so hard to separate, they have   trouble making pipeline quality gas to start with  until they've worked that N2 through the system.   Just for a couple points of reference, methane  is colorless, odorless, and highly flammable.  

So the advantage of it being odorless, just  like CO2 being odorless, if we actually can   get complete anaerobic digestion, the carbon  compounds that we're making don't have any odor,   right. So that can help out some odor challenges  on our farm, but we do have to get relatively pure   hydrogen itself or have methane to put it on the  pipeline. So when we talk about energy density   and I think this is something that we talked a lot  as we started adding ethanol to our gasoline fuel,   right. When you think about fuel densities,  gasoline is somewhere around 46 megajoules   per kilogram, ethanol is a little lighter,  right. So, as we think about putting it in,   we only get 30 megajoules per kilogram, so  when we talk about maybe getting less fuel   mileage with a gallon of ethanol, we have  a little less mass there the density isn't   that different though, so there's less energy  in a gallon of ethanol as compared to gasoline.   Methane, on the other hand, is more energy  dense. When we think about it in terms of  

weight, but methane is not very dense at all,  right, it's a gas. So when we start thinking   about what that might mean, it doesn't work  for a transportation fuel unless we really can   pressurize it and condense it, so your  comparison there is on the bottom. Like I mentioned, there's CO2 in that gas. The CO2  is essentially zero energy content. It does take a   little energy if we were doing direct combustion  on the farm trying to make electricity. It does  

take a little bit of energy to heat it up, so  it is a waste in the product. Same way with   water vapor, we tend to do good separation  these days, or relatively good separation,   of water vapor before we can bust it in a boiler,  but they are sort of parasitic in that system,   where it takes some energy to warm them up rather  than getting energy out of them. Hydrogen sulfide   contains good energy, right, so even if  there is some in our gas when we burn it,   we'll still get decent energy. It is stinky, you  can't really detect it, and the big problem there   is when we burn sulfate it makes sulfuric acid.  So, if you don't remove hydrogen sulfide before   you combust it on your farm, it does tend to cause  some issues in your generator, where we're eating   it away with sulfuric acid. Oftentimes, people who  have tried to use this gas for boilers have maybe   not done as much cleaning to get it to as a pure  quality, knowing that their boiler will suffer   some damage from hydrogen sulfide, that sulfuric  acid generation, and hoping that the cost of not   cleaning more than makes up for the shortened  life of the boiler, but that's sort of a farm or   process decision on any specific farm. The other  thing we end up with is that liquid digestate.  

Typically, it's relatively nutrient rich,  especially if we start with something like   manure, but it is definitely not to the point  where we're going to ever be allowed to discharge   it into a water body. It will take further  treatment or land application to dispose of it.   When we think about some real big advantages  of anaerobic digestion, as compared to   cellulosic ethanol or other energy generation  processes, it doesn't need sterilization,   right. We're going to need bacteria, so we don't  have to do much for cleaning and that makes it   very amenable to taking a wide range of  products. Swine manure, poultry manure,  

cattle manures, corn stover from our field without  any cleaning, so that is a huge advantage to us.   The second one is product separation, right. It's  really easy to separate that gas from the liquid,   so we don't have to use sophisticated systems. If  you've ever seen the cellulosic plant that they're   building here near Ames, to separate their ethanol  that they generate from all their liquid product,   they had built really large really expensive  distillation columns and condensing columns,   right. So, we don't have to invest in that sort  of technology to get there and despite the fact   that later we'll talk about that we've seen a  fair amount of failures of anaerobic digesters,   it is relatively simple equipment and operations.  Certainly, I don't mean to minimize the challenges   that you can have in these systems, there are many  of them, but in comparison to maybe some of the   other energy generation systems, like cellulosic  ethanol it is a little bit simpler. The big  

challenge that we've always had with these systems  is, can we compete with other energy sources? And   we talked about electricity earlier for the most  part people struggled to operate these systems in   a way where they competed economically. And with  compressed natural gas, certainly it's provided a   new opportunity for the most part. We'll have the  same discussion can we compete economically with   relatively cheap natural gas, especially as we  were fracking, we saw some challenges to meeting   that and the only thing that really makes this  cost competitive now is government incentives.  

Whether it be that RIN credit or programs like  the California low carbon fuel standard. Some   disadvantages of anaerobic digestion: reaction  rates are relatively slow, that tends to mean we   need relatively big vessels on our farm and  that still adds up to some some pretty good   capital cost. Installing a digester probably  is gonna cost us in the range of a million to   two million dollars on a farm when we get towards  that economically feasible size. Maybe sometimes   even larger methane yields are relatively low,  right. So that's the product we want to make,  

more is better, but even though we can get some  conversion, it's not always super high amounts.   And then conversion times, like we mentioned,  is relatively long. It's not a day, it's not two   days. Typically when we talk about manures, we're  in the neighborhood of that 28 day or somewhere   around a month-long retention time in our digester  to get the conversion we need. And then obviously   gas cleaning and corrosion issues are important.  And certainly we've seen some technologies to help  

us along the way with that. The only reason we  can have the compressed natural gas discussion   right now is technologies, like pressure swing  absorption or membrane separation technologies,   have really put themselves in a in the marketplace  where they can clean the gas for roughly half the   price to the value of the natural gas as we put  it on, depending on sort of your project size.   So all of a sudden we can start having these  conversations about what does a farm need to   look like to be economically feasible? And then  the last thing I wanted to talk about before we   moved to some economic modeling was estimating  gas production, because really the size of your   project is one of the most important  variables to making these things go.   There are a few ways to estimate the amount of  methane we'll make. One of the easiest is based on   the amount of COD chemical oxygen demand we have  in manure. The harder part there is you do need to  

estimate some COD conversion percentage and that's  a little bit different for every substrate. It's   a little bit different depending on what our  manure looks like, but I do have a table here   for you that comes from a great NRCS document that  I'll make sure we get shared on the IMMAG web page   about what sort of percentages of COD conversion  you can anticipate. And I think one of the   big things here you'll see for swine is the  COD conversion is actually relatively high.   When we talk about how much biogas we're  making, we estimate somewhere around 33   cubic feet per animal unit per day,  which actually makes us relatively   comparable to dairy operations where we've  tended to see more of these digesters installed. The other way to estimate biogas production  is with the biochemical methane potential.  

Basically, it's a lab analysis where you  digest the manure as completely as you can   and they see how much methane they made from  a sample. It's a lot better estimate than   using table values for the same reason that  actually taking a manure sample gives us a   better estimate about how much nutrient we're  actually going to be applying from our field,   but it does take a little bit of time. Oftentimes,  those tests take somewhere around a month to   complete because we do want to get that complete  digestion, but it is a much more specific answer   to an individual manure. So that we'll take a  brief break as we switch some presentations.  

I see Gabby has joined us, so hopefully Gabby  can unmute, yes, and if I stop screen sharing   appropriately, you can hopefully be able  to change share your screen all right. And while Gabby's doing that, I'll give a brief  introduction. Gabby is a graduate student pursuing   a PhD here at Iowa State University under the  guidance of Dr. Raman and myself. I've been really   lucky to work with Gabby. She is a great student;  as an undergrad student, she did some economic   modeling for us on a few projects, anaerobic  digestion and biogas production being one of them.  

And currently she is transitioning into doing  some water quality work with manure for us   up at the Nashua site, looking at some different  cover crop treatments. So gabby's been a great   asset to our team. I think she's a great asset  here to Iowa State University and she's going   to talk you through some biogas production cost  modeling that she did with us to try and figure   out what kind of farm could these systems be put  on in Iowa, what would that sort of system be   what would it look like. So, by no means do we  we think this is the answer to all the questions,  

but it does get the conversation  started about what we see as some   potential opportunities and some potential  challenges. So with that, Gabby take it away.  Alright, so like Dan said, we made this biogas  production cost model. Just a brief introduction,   we focused on swine manure instead of beef  or dairy cattle, like we normally see. And   instead of focusing on using  biogas to produce electricity,   we actually looked at how it could compete with  natural gas instead and for use off the farm,   specifically as a transportation fuel,  so we could utilize those RIN credits. Also in our model, we look at the impact of  using corn stover along with swine manure   to maximize the methane production potential  and then different levels of centralization   to see if it could be viable at a single farm or  if you know multiple farms need to work together   in order to make the system economically viable.  So in this presentation, we have four scenarios.  

The first scenario is a water limited co-digestion  farm scale scenario. So this would just be a   single farm. There's no additional water added,  so not as much biomass can be included in the   digestion. And then cleaning an injection into  the natural gas grid would take place at the farm.  

In scenario two, we consider in a water  addition to the digester that's equal to   the volume of manure. So that would allow for  more corn stover to be added to the digester,   but otherwise it's the same as scenario one.  In scenario three, we consider centralizing the   biogas cleaning and injection site. So in that  scenario, five farms would share the cleaning   point for the biogas. And then in scenario  four, we consider a community scale digester.   So that would be shared by five farms,  so it handled the manure of five farms,   but everything would take place  at that centralized facility So just another description of  the scenario. So in scenario one,   it's a single digester and it would  need to pull corn silver from 125 acres.  

In scenario two, because of the water addition,  the land needed for the biomass is higher at 500   acres. Scenario three requires the same amount  of land for each farm that scenario two does,   but there's a centralized cleaning point  for the biogas so they share that cost.   And then scenario five has five farms that  transport their manure to a centralized digester. So this slide just shows some of the key  assumptions that we put into our model.  

So we assume for all scenarios that the swine  manure would cost five dollars a ton, corn stover   would cost twenty dollars a ton, and the maximum  amount of solids you could add to the digester   would be a twelve percent solids. For the farm  size we assumed 4,800 head farms in each case. And then for biogas and manure transport we  assumed that it would be 2.5 miles that manure   transportation cost would be about a third of a  cent per gallon per mile. The capital cost was   scaled using a 0.6 scaling exponent, assumed 20  years loan and at seven percent interest. And then   for credits we assume that you would get some  money back for the digestate or digester effluent.  

And then we also considered the D3  RINs, which we used a three-year average   from 2017 to 2020 and that's a dollar ninety-two  cents per gallon of ethanol equivalent. We also   show at the end of the presentation a different  cost for RINs and a zero interest scenario. So, for each of the scenarios, we compare to  the Iowa Citygate National Natural Gas price, so   that's 4.63 per gigajoule. But you can see kind of  how that's changed since the 80's in this graph.

So, like I said before, because corn stover has  the higher methane production potential than   swine manure, we tried to maximize the amount of  corn stover that could be added to the digester,   within the 12% solids limit. So, to calculate  the water addition needed to meet this,   we wanted to make a land balance between  the corn stover harvested and the land   that would be need to do would be needed to  apply the digester effluent as fertilizer. So,   these are kind of the assumptions that went  into that. Then we assumed that the manure  

would be produced at 1.2 gallons per head per  day, with a 0.05 pounds of nitrogen per gallon,   and that we would harvest corn stover add  three tons per acre, and then we assume that   the digestate would be applied to the land as  fertilizer at a rate of 150 pounds per acre. So, this slide just has the results of that  analysis. So, the biomass demand ranges from   375 tons per year to 7,500 tons per year.  The land requirement for that ranges from   125 acres to 2,500 acres, so that ends up  being 19 to 77 percent of the land is needed   to harvest biomass from the land that  you would require to apply the digestate.   So, this is the results of the first  scenario, which was the farm scale digester.  

So, it ends up about after credits costing  about two times the cost of natural gas in Iowa,   but that's after considering the RIN  credit. So, before any credits at all,   it's it's quite a bit more expensive, about  10 times more expensive than natural gas. So, scenario two this is where we added water,  so we could maximize the corn stover input and   the methane production. So, this  scenario is actually less expensive than   natural gas in Iowa by a little  bit; it's about 93% of it. The share of costs changes a little bit. The  biomass makes up eight percent of the total cost,   instead of three percent of the total cost in  scenario one, just because you're adding more.

Scenario three, so, this was the  centralized cleaning and injection point.   This scenario was actually not any better than   scenario two, so, that let us think that  sharing the centralized digestion point was not   worth it. It becomes more expensive  than natural gas in this scenario. and the capital cost of the pipeline that would be  needed to transport the natural gas makes up about   19 of the total production costs here.

So, in the last scenario, this was the  community scale digestion where manure would   be transported to a centralized digester.  So this is the most competitive scenario   when you consider the RIN credits, the cost is  negative, so you could make the profit here.   So, that just shows that the manure transport,  it doesn't it's less drastic than the   like scaling advantage you get from  scaling up the digestion process.

So, I'm looking at this and I did not update  this graph, so these are the wrong numbers,   I'm sorry, but the you can see  that the centralized cleaning   scenario, which is scenario three, did not have  any advantage over scenario two, so you would be   better off just having a totally decentralized  digester than sharing the injection point. But   the community scale digestion is still the most  cost effective. In this slide we show the zero   interest scenario. So, this was the same as  scenario four, but we assumed that there was  

some government program that allowed the capital  costs to have no interest. So, it's a lot more,   it's about eight eight dollars per  gigajoule below production cost after you   consider RIN credits and here the capital  cost makes up 25% of the cost instead of 40   percent of the cost that it makes up in scenario  four. So, that could be a way for producers to   be able to get that capital covered, because  it would be a lot for this centralized   scenario. So, here is all of the scenarios  compared to the cost of natural gas.   So, like I said before, scenario  four is the most competitive option.   The benefit of the economies of scale you get  from centralizing production outweighs the cost   of manure product or manual transportation  that you have to do in that scenario,   but scenario two is still competitive  with natural gas without centralization.

So, in this slide I show the difference between  the two types of RINs that biogas can qualify for.   So, D3 RINs are what agricultural digesters  qualify for. So, that average price was a dollar   ninety-two for 2017 through 2020, but the blending  volume could accommodate about one thousand of   these scenario fours that we have, which is  about eighty percent of swine farms in Iowa.   So, the other type of RINs that biogas  sometimes can qualify for are D5 RINs, which are   advanced biofuels. So, some types of waste  digesters will qualify for these and they  

have a lot lower average price. So, this slide  just kind of shows that the price of the RIN is   very important to whether or not the system can  be competitive. So, when you go from the $1.92   for a RIN in D3 to the 58 cents, you're way above  the price of natural gas and for the D5 RIN,   that's about three times the price of natural  gas in Iowa, so it's no longer competitive,   but the volume could accommodate more swine  farms and about 8,600 of our scenario for us. So, this slide shows the RIN price over the past  seven years. So, you can see that for D3 RINs,  

there's been a lot of volatility and that  is concerning if you were going to be   dependent on this, because a 10 cent change  can cause a dollar and 23 cent change in the   overall price of your biogas or the production  cost. So, it's very the cost is very dependent   on these RINs, so the volatility is a  concern. Another concern is reliability. So since 2000, about 25% of the total anaerobic  digesters on livestock farms have been   shut down, but most of these are  single farm digesters where a farmer is   doing all the work for the  digester on their own. So,  

we think that maybe a scenario four type of  system would improve the reliability, because   specific staff could be hired to run the digester.  It wouldn't be just the job of the people at the   farm. Kind of relieve them of that burden  and maybe make the digesters more reliable. So, in conclusion you can see that  maximizing corn stover input was   needed to bring the production costs  down to competitive with natural gas.

The cost of biogas transportation  in the shared cleaning scenario   was too much to make it competitive  with the totally decentralized scenario.   Overall, the centralized digester was  the most competitive and any chance of   economic viability is dependent on government  programs, like RINs, or zero interest loans. Perfect, thank you, Gabby. I really  appreciate the work you put into  

building that model and presenting it. I  think one of the challenges has always been   identifying farms that might be a fit and  what it really takes to make these systems   work. And I thought your work helped really  make that clear. Thank you. So with that,   we'd definitely like to open it up for any  discussion or questions people may have. Feel free to unmute and ask them  or type them into the chat box. And we're not going to get any questions, I  think, which is perfectly okay. I will say,   I do appreciate seeing Mark Garrison here. I  know Mark did some work with anaerobic digestion  

back when he was working on his master's degree,  so certainly he has some great experience on some   of the challenges and struggles that that we  can face along the way. We did not get into the   regulations today about when is it an anaerobic  digester, what does that mean for effluent   application considerations, what happens if you  take other byproducts from processing plants,   what the regulations look like, that could be  a conversation in and of itself, but certainly   as we think about some of these projects something  that we would have to consider. I think one of the   important take home from Gabby's modeling work is  that, while oftentimes we've said these digesters   only fit on relatively large farms, you can see  if you would start looking at potential to blend   manures with biomasses, some standard size swine  farms, right, 4 800 head finishing operations,   can start to look economically feasible. Certainly  their absolute distance from the pipeline,   depending on how that compared to what we modeled,  or the ability to build a community digester and   work out manure sharing agreements could add some  complexity to these systems, but one thing that we   do see is that we're in the neighborhood where  these systems start to look feasible and could   work and that's one of the key reasons why we're  seeing a lot of interest in these systems in   neighboring states and potentially in Iowa. The  other thing I will mention is that in our work,   Gabby and I did not include the California Low  Carbon Fuel Credit in our work here because that   is set to expire next year and I didn't want to  project the tea leaves on where that would go,   but again the California credit is somewhere  in the neighborhood of four to five times what   that RIN credit is, which really makes many  of these systems look more favorable than what   we presented, presuming that the California  credit gets renewed and and we can all still   capture it. The California credit is dependent on  species and what your original methane production   would be from your manure storage, so swine and  dairy farms tend to benefit from that rule, beef   farms not nearly as much. I can talk to you about  more details on that if anyone would like them,  

but we'll take that offline. The same way  goes when you're collecting a D3 and D5 RIN.   EPA was not approving process pathways  for a little while, so there are some   questions about how different agricultural  residues would qualify within that system. But with that, really thank  you all for joining us today.   We will have next month off, but  we hope to see you again in July,   when we talk about odor control and bring back  Dr. Steve Hoff. So, thanks everyone for joining.

2021-05-15 18:46

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