The Massachusetts Department of Environmental Protection (MassDEP) has upped organics diversion activities by slating food waste for a list of items to be banned from disposal. When the program is fully implemented, DEP anticipates 350,000 more tons will be diverted from disposal annually by 2020. MassDEP hopes this ban, combined with increased use of anaerobic digestion at wastewater treatment plants and farms, can increase energy production from anaerobic digestion (AD) to 50 MW annually (current estimates put combined production at 5-10 MW). Getting renewable energy from organic materials is a component of MassDEP’s Clean Energy Results Program, an initiative to advance renewable energy and energy efficiency in the Commonwealth by streamlining assistance, reducing barriers and providing technical help in siting renewable energy projects.
MassDEP is working on regulatory revisions to clarify the permitting pathway for anaerobic digestion projects and has posted them for public comment (deadline is January 23). The draft regulations and hearing schedule can be viewed at www.mass.gov/dep/public/publiche.htm#regulations.
Meanwhile, grants are available to communities for feasibility studies to assess anaerobic digestion technology. The state also has established a new assistance program called Recycling Works, which will help businesses and institutions divert organics. One of the state’s biggest challenges is getting the infrastructure and collection logistics in place before the ban, which is anticipated to be in place by 2014. “Meeting the goal is contingent on having that capacity in place,” says John Fischer of MassDEP. The agency is also looking to establish anaerobic digesters on state property and offers loans of up to $500,000, with interest rates as low as 2 percent, to companies wanting to establish AD facilities. These loans are designed to help interested parties leverage additional financing. Additional grant program incentives to foster development are also being developed.
Wastewater treatment sites offer other possibilities for siting digesters and can accommodate food waste. The state currently has five anaerobic digestion systems operating or planned at wastewater treatment facilities with the largest being the Massachusetts Water Resources Authority’s Deer Island Treatment Facility. Two digesters are operating on farms, processing around 50 to 100 tons/day, with two others permitted and a handful more planned. The average-size of these digesters is around 30,000 tons/year, Fischer says. Current available capacity for food waste processing — including both composting and AD — is about 50,000 to 100,000 tons/year, he adds, so around 10 additional AD facilities would create the approximately 300,000 tons of additional capacity required to meet the state’s 2020 diversion goal.
Section 1603 Deadline Expires, But Could Be Resuscitated
Section 1603 of the Internal Revenue Code was intended to infuse capital into renewable energy projects by allowing developers to receive a U.S. Treasury Department grant in lieu of tax credits to cover up to 30 percent of eligible project costs. The program was actually an extension, through 2011, of tax cuts established under the Bush Administration. With a December 31, 2011, expiration deadline looming, Congressional Democrats sent letters to Congressional leaders urging them to extend the program, citing 290,000 jobs created and $23 billion in private investment leveraged as a direct result of projects stimulated by the grants.
The clock has now run out on projects that were unable to meet a “Commence Construction” deadline requiring them to have significantly begun construction (i.e., more than just site clearing) by December 31, 2011. This deadline also could be met by a “Safe Harbor” whereby a project invested at least 5 percent of capital costs, such as equipment purchases or forming a firm contract with a builder and making a payment. The program has a related application deadline of September 2012 for projects that can demonstrate having met the December 31, 2011 deadline. Congress still has the authority to extend these deadlines after the fact and allow more projects to qualify.
“No one can predict what Congress will do in the next couple of months,” says Patrick Serfass, Executive Director of the American Biogas Council. “However, we’re urging Congress to consider extending Section 1603 along with some other important tax incentives that expired at the end of 2011, unrelated to biogas. These programs directly stimulate large private investments that wouldn’t otherwise be made, and so we need 1603 to continue to stimulate this economy. We urge everyone to call their member of Congress and explain why Section 1603 is significant to your business.” As for the likelihood of resuscitating the program, Serfass says, “Congress has retroactively extended deadlines before. It is not over yet.”
British Columbia, Canada
Benchmark Study Released
In December, the Agricultural Research and Development Corporation, a wholly-owned subsidiary of the British Columbia (BC) Agricultural Council, announced release of the British Columbia On-Farm Anaerobic Digestion Benchmark Study. The study provides an informational point of reference for individuals and groups in the province’s agricultural sector to make informed decisions regarding development of on-farm anaerobic digestion systems. Benchmarks have been drawn from analysis and summation of feasibility studies developed for 12 farm sites in BC that were selected to represent geographic, demographic and circumstantial variances. Using information from these sites, the study modeled specifications and parameters to determine capital and operational costs for AD system development and operation. This included determining necessary energy tariffs and funding amounts to achieve economic viability using the sale of electricity or biomethane as the primary revenue source.
The study recommends changing current draft federal environmental regulations to be less restrictive with regard to off-farm organic wastes in order to make more AD projects more financially viable. “Currently, the proposed regulatory regime unnecessarily prevents development of on-farm AD systems,” states the report’s executive summary. “One of the key impediments identified by this study is that the Ministry of Environment’s (MOE) proposed On-farm AD Waste Discharge Authorization essentially limits the volume of nonagricultural feedstocks an on-farm AD system can accept to 25 percent. As a result, the potential number of economically viable AD systems in BC is restricted to a very small number of sites that have an ideal combination of farm size, distance from interconnection and proximity/access to highly desirable feedstocks. If MOE’s proposed [regulations] were changed to enable on-farm AD systems to meet the requirements for accepting 49 percent nonagricultural feedstocks, the number of economically viable sites in BC would increase dramatically.”
The study received funding from Agri-Food Canada through the Canadian Agricultural Adaptation Program (CAAP) and from Growing Forward, a Federal Provincial Territorial Initiative. The study and 12 farm feasibility studies is at www.bcfarmbiogas.ca.
Reap Funds Give Boost to Industrial Digester
Jim Stevens is a veteran of food waste recycling, with a 40-year (and counting) career that includes converting bakery waste into animal feed in a dozen plants around the country — at a rate of about 15,000 tons a week — and meat rendering, also for animal feed, on a large scale. Organic Matters, Inc., a company Stevens founded in Bartow, Florida, recently received a $201,498 grant from the USDA’s Rural Energy for America Program (REAP) to help finance an anaerobic digester. The grant will cover only a small percentage of the multimillion-dollar project, with the balance coming from Stevens. “After selling International Processing in 1996, I founded Organic Matters in 1998 to try to research the future of organics recycling,” says Stevens, adding that he was first introduced to anaerobic digestion technology in 2003. “Food waste is our primary business. We recycle the vast majority into animal feed. When Walmart made the big change that their organics were not going to the landfill, we got the Florida deal. We decided putting in an anaerobic digester was a good complement to our animal feed business.”
Initially, Organic Matters plans to clean the gas and sell it back to the grid. “We are going to upgrade the biogas so we can put in into the pipeline,” says Stevens. “We really ultimately want to use it as transportation fuel for our own fleet.” The company is finalizing its design, he adds, and has “a couple more permitting hurdles. We hope to start and finish construction in 2012.” He notes that his project will demonstrate the ability to produce energy from high strength industrial liquid wastes, including suspended solids in the wastewater generated by the bakeries Organic Matters currently serves. “With what we are doing —recycling a lot of material including postconsumer plate-type waste into animal feed — there is always a certain amount that is too high in moisture,” says Stevens. “So this is not a stand-alone project for us; it’s a complement to our current business.”
Bordentown, New Jersey
Future of Ad in Garden State
The New Jersey Work Group on Renewable Natural Gas was assembled in late 2010 to develop strategies for launching a renewable natural gas (RNG) industry in New Jersey, with particular emphasis on making RNG from organic wastes as the lowest-carbon fuel solution yet available for fleet trucks and buses. The Work Group is cochaired by Gail Richardson, vice president for programs at Energy Vision, and David Specca, Assistant Director for Bioenergy at the Rutgers University EcoComplex in Bordentown. It includes 30 representatives of companies, state agencies, nonprofits and utilities all tackling the question of what combination of technologies and business models are most economic in converting biogas produced by organic wastes at landfills, wastewater treatment plants and farm and food waste digesters into valuable energy resources.
According to the Work Group, New Jersey is an ideal location for such an endeavor due to high population density, traffic concentration, federal nonattainment zones for air pollution and high waste management costs, as well as multiple state laws that require reduced oil dependency, cleaner air, organics recycling and lower GHG emissions. The Garden State is also home to a high concentration of biogas cleanup companies and demonstration projects. The EcoComplex was the site of the first biogas-to-vehicle-fuel demonstration in the U.S. in 2004-2005; it is also home to a waste-to-energy project, which captures landfill methane and uses it to heat more than an acre of greenhouse space that serves as an incubator for startup businesses.
One of the Work Group’s early successes was to be drafted by the New Jersey Board of Public Utilities (BPU) as the “Biomass Work Group” to provide input to the State Energy Master Plan, which for the first time includes the transportation sector and promotes the shift of local truck and bus fleets to natural gas fuel. “We have attracted people with expertise and commitment to work through challenging issues to move the anaerobic digestion and RNG vehicle fuel industry forward,” says Richardson. “We encourage people to focus on the highest-value product when converting organic wastes to energy — and that is as a fuel that can displace diesel in heavy duty trucks and buses. If we could get multiple projects started across several sectors, over time New Jersey could produce a lot of renewable power and vehicle fuel from organic waste.”
Energy Vision will publish the findings of the Work Group in mid-2012. The report, The Jersey 55, refers to the dozens of sites at landfills, wastewater plants, farm digesters, transfer stations, food processing plants and other locations having high concentration of organic wastes suitable for AD and RNG production. Business models applicable to these diverse locations will be included in the report.