June 26, 2006 | General

Trading Carbon Credits From Methane Digester

BioCycle June 2006, Vol. 47, No. 6, p. 52
Credits are certified and sold on the Chicago Climate Exchange – the first established market for greenhouse gas pollution credits.
Amanda Bilek

The Dennis Haubenschild dairy farm near Princeton, Minnesota has added another “one of the first” distinguished honors to its list of accomplishments. Previous honors included the first methane digester to be built in Minnesota and the first digester in the world to run a hydrogen fuel cell off of biogas.
When the Haubenschilds began trading carbon credits from methane captured by their anaerobic digester in November, they were only one of two farms in the nation to do so. Now there are over a dozen farms trading carbon credits from captured methane. The credits provide an additional source of revenue for the farm and address a growing, serious concern: global warming.
“All businesses have to be sustainable,” said Haubenschild. “We have to lessen the footprint we are leaving on Mother Earth.” Dennis and his family farm has always been a shining example of sustainability, as a certified 5-Star Environmental Quality Assurance dairy by the Minnesota Milk Producers.
Haubenschild’s value of sustainability has been lifelong, but seven years ago the Haubenschild dairy put that value into practice one more way by installing an anaerobic digester, a technology that captures greenhouse gases (mostly methane) given off during the decomposition of manure. The gas captured during this process is used to generate electricity. The Haubenschild’s power their own farm and sell the excess to a local utility.
The carbon credits in this case were calculated based on the amount of methane prevented from entering the atmosphere during the anaerobic digestion process. Although Haubenschild’s farm is too small to work directly with the Chicago Climate Exchange, Environmental Credit Corporation – a credit aggregator and a leading supplier of environmental credits to global financial markets – partnered with Haubenschild to certify and register his credits with the exchange, ultimately trading them for cash. Environmental Credit Corporation calculated that in the last two and a half years, the Haubenschild digester captured 525 tons of methane, which is equivalent to 9,587 metric tons of carbon dioxide.
The credits were certified and sold on the Chicago Climate Exchange -the first and only established market for greenhouse gas pollution credits in the United States. Large power and manufacturing companies volunteer to be a part of the Chicago Climate Exchange and can buy carbon credits, like those sold by the Haubenschild farm, if they cannot reach greenhouse gas reduction goals on their own. Exchange members commit to reduce emissions or trade to meet the goal of a one percent reduction per year in greenhouse gas pollution between 2003-2006.
According to Nathan Clark, an economist with the Chicago Climate Exchange, “We are at the very beginning of what we feel will be a major shift in paying agricultural producers for the environmental services they provide society.”
The Haubenschilds are pioneers in the area of renewable energy and are now demonstrating new leadership to address global warming. Private partnerships, like this are happening despite the lack of public policies to address global warming. Such partnerships prove that it’s possible to develop solutions to address this complex problem. Our policy makers should follow their lead.
Since its start-up in 1999, the plug-flow digester has continually processed all dairy manure from 900 cows along with newspaper bedding. Manure is mixed for consistency, remaining in the digester for about 15 days. Biogas is piped to the generator to produce electricity, and digestate is later applied on fields. Approximately 3,000 kilowatt hours/day are generated – saving approximately $40,000/year on electricity bills.
In 2005, a small portion of digester biogas was routed into a research building that houses the hydrogen fuel cell, clean up and monitoring equipment. In February, 2005, the fuel cell was run on biogas, and University of Minnesota Researchers were planning longer duration trials. Adds Dr. Phil Goodrich: “Fuel cells and anaerobic digestion are part of the expansion opportunity for energy harvesting. Hydrogen may be one of the primary drivers of the economy within 10 years; since it is clean, it can be stored, and does not pollute the atmosphere.”
Amanda Bilek is an Energy Program Associate with The Minnesota Project in St. Paul. The site can be visited at, and she can be e-mailed at This report by Bilek appeared in the Spring 2006 issue of Community Connections newsletter.

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