Authors: Gary Musgrave, Bill Lazarus, Dan Ciolkosz, Penn State Extension
Overview:
This business opportunity plan (BOP) describes the steps involved for a hypothetical farm (called “Green Mallard Farm”) to contribute manure to a community anaerobic digester that is operated by a separate digester company. The community digester uses the manure from the farm (and other farms) to produce biogas from manure (and perhaps other feedstocks such as perennial grass and food waste). The biogas may be used to produce electricity and heat or sold as Renewable Natural Gas (RNG) for injection into an adjacent pipeline. The overall methodology of the arrangement is described.
Since the digester is owned and operated by others, the finished project for the farmer is simpler than most farm digester projects. It consists of the following systems: 1) manure storage at the contributing farm, 2) digestate receiving at the farm, and 3) any necessary upgrades for trucks to access the manure. In this particular case, trucking is being provided by a third party contractor, arranged by the digester company. The project may require six months or so to establish a working arrangement with the digester company and make necessary modifications to the manure and digestate handling facilities at the farm. Startup costs and labor requirements are expected to be much lower than for a farm that builds its own digester, and while the income is also lower than for a digester owner, the returns for the farmer are positive with a projected $57,985 net present value over the 15-year project period. Adding a winter rye biomass crop to provide additional feedstock to the digester dramatically increases returns to an estimated net present value of $162,920 over the life of the project. This is a reasonable supplementary income stream for a dairy farm, and so farmers that are in a similar scenario to Green Mallard Farm appear to be well suited, economically, to supply manure to a community digester.
For a full copy of the report, please contact the authors