Posted: Thursday, December 06, 2012 12:00 PM
Dan Wheat/Capital Press
About 3,500 cows are milked daily at George DeRuyter and Sons Dairy near Sunnyside, Wash. Their waste is carried in 150,000 to 180,000 gallons of water daily to a digester that produces biogas that is converted into enough electricity to power about 1,200 homes.
Evans: 'There's a critical mass for us of manure from 8,600 cows daily to make this work'
By DAN WHEAT
SUNNYSIDE, Wash. -- A new $13.5 million manure digester system planned for two large dairies near Sunnyside could resolve federal allegations that they are polluting drinking water -- and provide a model for the production of renewable natural gas.
George DeRuyter and Sons Dairy and Cow Palace Dairy are working with Seattle-based Promus Energy on plans for the digester. Construction will begin this spring and be completed a year later.
The system would be the only one of its kind on the West Coast, said Dan Evans, president of Promus, an energy development company specializing in natural gas produced from organic material such as manure, food and crop stubble.
"We're betting this model is the future for dairies and it could be a silver bullet solution in the Yakima Valley where we have nutrient issues," Evans said.
On Sept. 27, the federal Environmental Protection Agency issued a report targeting George DeRuyter and Sons, Cow Palace and a third farm, Liberty Dairy, for nitrate pollution to ground and drinking water. The dairies, all in the Sunnyside area, said the EPA report was based on incomplete data and inaccurate assumptions. Lawyers from both sides are negotiating potential solutions.
Meanwhile, George DeRuyter and Sons and Cow Palace have been working with Promus and hope the project will be part of any solution with EPA.
"EPA is supportive of it. We see it as a win-win for both parties," said Adam Dolsen, owner of Cow Palace.
The three dairies are close in proximity. Liberty is not part of the project yet but a new anaerobic manure digester built at Cow Palace would have capacity to handle Liberty's waste in addition to other organic waste from orchards, Dolsen said.
Part of the system is the existing digester at George DeRuyter and Sons. The only dairy digester in Eastern Washington, it was built in 2006 at a cost of $3.8 million. Its peak capacity is 1.2 megawatts of electricity, which is sold to Pacific Power.
When DeRuyter built the digester, rates for renewable electricity were on the rise, Mark Leader, spokesman for the Washington State Dairy Products Commission, said. Then rates dropped because of an abundance of natural gas and an increase in major wind power projects, Leader said. Rates in Central Washington already were among the lowest in the nation because of the abundance of hydroelectric power.
The DeRuyter operation made money, reduced odors and pathogens but did not significantly reduce the nutrient load of the treated water that was used on fields, Leader said. Putting that load back on the field as irrigation water with natural fertilizer is what the EPA says caused the ground and drinking water pollution.
"It penciled out until the end of this year at 6.5 cents per kilowatt-hour but that's dropping to 3.5 cents and we make no money below 5 cents," said Dan DeRuyter, dairy co-owner.
He was planning to shut down the system at year's end but now plans to operate it at a loss to maintain the digester until it becomes part of the new system.
Promus will soon be seeking private investors for the project, Evans said. Government grants or loans for nutrient recovery are also an option. Promus will incorporate DeRuyter's digester debt but can't say if it will cover his operating loss between now and the new system being online, Evans said.
DeRuyter's digester is a 3.3 million-gallon concrete tank with a white, hard-foam-insulated top at ground level. The tank is 300 feet long, 90 feet wide and is buried in the ground.
It receives 150,000 to 180,000 gallons of recycled, dairy wastewater daily. Solids settle to the bottom, are heated to 100 degrees over 21 days and turned into biogas, which is used to generate electricity.
The new digester at Cow Palace will be larger, Dolsen said. Biogas from DeRuyter's digester will be piped a quarter mile to the Cow Palace unit, where biogas from both dairies will be cleaned and converted into natural gas, Evans said.
The gas can be sold onto a pipeline grid or trucked at significantly greater return of about $2 per gallon equivalent, he said.
"There's a critical mass for us of manure from 8,600 cows daily to make this work," Evans said.
That's the number of Cow Palace and DeRuyter combined and if Liberty joined it would be 13,300 cows, he said.
The timing is right, he said, because the nation is on the eve of a "tectonic shift" in the energy market with the discovery of huge sources of shale gas in North America that will make natural gas a key fuel for a long time.
"In two to three years, every large trucking fleet will be converting to natural gas," Evans predicted.
In addition, Evans said, recent advances in nutrient recovery technology make it commercially viable to extract marketable biofertilizers, including ammonium sulfate and organic phosphates, from the manure in the digesters. That reduces by 60 to 70 percent the amount of nitrogen and phosphorous that go back to the land via dairy lagoons and irrigation.
The higher fiber solid that is left can be turned into a peat moss substitute of higher value than conventional compost from dairies, he said.
By capturing methane and using it for fuel, the dairies also earn carbon credits that they can sell for yet more revenue, Evans said.
It takes all components of the system to make it profitable, he said.
"The nutrient recovery process is a whole new aspect to digester technology and it will change the way people look at digesters," Dolsen said.
The renewable natural gas and nutrient recovery model was evaluated by Washington State University, Promus and other experts as part of a state Department of Commerce study. The study confirmed the model can be profitable, green and broadly applicable, Evans said.
Promus, WSU, DVO Inc. of Chilton, Wis., and Andgar Corp. of Ferndale, Wash., are now designing the new DeRuyter-Cow Palace system, Leader said.
In September, EPA's AgSTAR program estimated there are 192 anaerobic digesters operating at commercial livestock farms in the country.
Steve Dvorak, president of DVO Inc., said his company has designed or manufactured equipment for 80 of them, mostly dairies generating electricity for local utilities.
Biogas from livestock manure also is used as boiler fuel for steam-powered plants, or it can be cleaned for renewable natural gas, Dvorak said.
Fair Oaks Dairy in Fair Oaks, Ind., operates 42 trucks hauling milk using natural gas from its digester, he said.
There are a couple of dozen dairy manure digesters in the Northwest, but no new ones in California because of air emissions criteria.
Most dairy digesters are owned by farmers but the trend is toward more separate ownership by investors, he said.
"Digesters are expensive and take management," he said. "A lot of dairy people want to milk cows and not run a waste treatment plant, so it's not for everybody."
He foresees more digesters being built not just at dairies but other animal, food and municipal waste plants.
"Europe is way ahead of us, building more than we are," he said, "but we have a potentially larger market."