December 9, 2008 Wisconsin Boasts Most Manure-To-Energy Projects

Karl Crave walks by a mixer inside an anaerobic digester on the Crave
Brothers farm in Waterloo. The pipes on the wall will heat manure to
about 100 degrees for the gas-making process. More than 700,000
gallons of manure will be placed in this tank.

An anaerobic digester is a system that converts energy stored in
organic materials present in manure into biogas. The manure is stored
in large concrete tanks. When heated, the manure is converted into a
biogas that is composed of 55% to 70% methane. The methane is then
used to power a turbine or engine to produce electricity. Excess heat
is used to heat farm buildings, and solids left over from the
conversion of manure into the gas are used by farmers as animal
bedding or fertilizer or sold as potting soil.

When it comes to generating renewable energy, Wisconsin lacks the high
winds of the Great Plains and the steady sunlight of Arizona, but it
has one abundant resource few others can match – cow power.

Although renewable energy makes up only a fraction of the state’s
total energy mix, one area that’s growing fast is systems that convert
cow manure into electricity and heat.

At the Crave Brothers dairy farm and cheese factory in Waterloo, the
farm’s anaerobic digester – its cow power system – takes manure from
the farm’s 1,100 cows and converts it to electricity.

Rising demand for the company’s specialty cheeses led to an expansion
that will add a second digester and triple the amount of electricity
the farm produces.

“They process their own milk, and the demand for the specialty cheeses
they make has increased enough to justify an expansion,” said Dan
Nemke, general manager of Clear Horizons, which provides the
digester.

Clear Horizons estimates it invested $4 million in the Waterloo
system.

Wisconsin leads the country in anaerobic digesters with 19 projects.
California is second, with 16.

“And we have 16 projects under contract right now set to go in, so we
should be doubling the number of digesters in this state in the next
year,” said Don Wichert, director of renewable energy with the state
Focus on Energy program.

Behind the surge in interest in homegrown energy is the recognition
that what once was waste now has value. That can include anything from
cheese whey to restaurant grease to cow manure.

Alternative energy push
Renewable energy experts expect activity to intensify, given the drive
to boost alternative energy sources by state and federal
policy-makers.

Several recommendations to boost renewable energy from waste – known
as biogas – were suggested by the state’s global warming task force
and may be included in a package of proposals Gov. Jim Doyle submits
to the Legislature next year.

President-elect Barack Obama has voiced support for global warming
legislation and has said boosting alternative energy will be one of
the ingredients of his economic stimulus package that he would like to
see Congress enact in early 2009.

“We’ve got lots of projects that would be ready to go if the economics
in some way were improved,” said Richard Pieper, president of Pieper
Power, the Milwaukee parent company of Clear Horizons. If the U.S.
enacted legislation to reduce greenhouse gas emissions, the economics
would improve and “we would have enough opportunity here to power
175,000 homes in Wisconsin,” he said.

Clear Horizons is a unit of Pieper’s mining equipment automation
business and its wastewater technology business. The firm entered the
renewable energy arena seeking ways to take its construction and
automation know-how and adapt it to emerging energy technologies.

“At this point, it doesn’t amount to anything. It’s very modest. It’s
less than a percent, but we’re a pretty good-sized company,” Pieper
said.

Cow power and other renewable energy projects could be a big piece of
total sales in 12 to 24 months, he said.

But Wisconsin’s leadership role in renewable energy is being
challenged as other states deploy the digester systems, which help
reduce waste runoff into streams and minimize odors.

At the moment, other states are more competitive than Wisconsin in
attracting investment in the systems, either through special
electricity rates, tax incentives or both. California, which
supplanted Wisconsin as the biggest dairy state several years ago,
could soon overtake the state in anaerobic digesters.

Renewable energy projects are more economical in other states, such as
Vermont, where incentives such as the state’s Cow Power program are
more lucrative than what Wisconsin offers.

“We’ve got a bunch of opportunities in Wisconsin,” Pieper said.
“They’re planned, but there’s nothing going forward. The economics of
the plants aren’t where they need to be moving forward.”

The price of power
GHD Inc., which opened its first digester system in 2001, now has more
digesters installed in Wisconsin than any other company.

The Chilton firm has 30 systems operating in nearly a dozen states,
with another 20 planned. In Wisconsin, 10 systems have been built with
another five on tap.

“We came close to doubling our size this year,” said Melissa VanOrnum,
marketing manager at GHD.

Driving the increase: Utilities are paying more for electricity
generated by the systems. Also, farmers are more confident in the
anaerobic digester technology.

“When I started working for GHD in 2004, the first question that
farmers asked was, ‘Does it really work?’ But for at least the last
two years, they’re not asking, ‘Does it work?’ They’re asking, ‘What’s
my payback?’ ” VanOrnum said.

Other companies also are seeing growth outside Wisconsin.

Microgy, which installed three systems in Wisconsin, is focusing on
projects in Texas, Nebraska and California.

One of the challenges for Wisconsin is that the digesters make the
most economic sense for large farms, Focus on Energy’s Wichert said.

“The biggest farms that we had were the first ones that went in, and
all these gigantic farms in California, Texas, Florida and New York
are realizing they should be doing digestion, too.”

The price of power also determines where a system will be installed,
said Larry Krom, who manages biogas renewable-energy programs for
Focus on Energy.

Power prices are steeper in states such as California and Vermont.
When prices are higher, the rate small generators can collect from
selling power to utilities is higher.

Several utilities have boosted their renewable rates in recent years,
and Madison’s Wisconsin Power & Light Co. will have the highest rate
in the state beginning in January.

The utility is proposing to boost its rate by 50% to 9.24 cents per
kilowatt in a case that’s pending with state regulators.

Interest in new biogas projects is still active, Krom said.

“Over the next month or two, a whole bunch of them are going to come
on,” he said.

Although most of the projects in the state process cow manure, food
businesses are getting into the act. In La Crosse, City Brewery
and Gundersen Lutheran Medical Foundation set up a system using waste
from the brewing process to create enough electricity to power 492
average Wisconsin homes, according to Focus on Energy.

As they watch to see whether more policies encouraging renewable
energy will be implemented in Washington and Madison, those in the
biogas industry see plenty of room for expansion in Wisconsin.

Wichert predicts a tenfold increase in the number of cow-power systems
in the state, with digesters dotting the rural landscape.

“We still have a long way to go,” Wichert said, noting Wisconsin has
250 farms with at least 500 cows each. “Those probably will all
eventually have digesters,” he said.