SMUD assists two Calif. dairy farms with AD projects

Two dairy farm manure anaerobic digestion projects under development in Sacramento County, Calif., are making progress and may be operational by the end of the year.

Having recently acquired Safe Harbor under the U.S. Treasury’s 1603 Program—which expired with the end of 2011 and provided qualifying renewable energy projects with a grant equal to 30 percent of the total project cost—the projects have secured the majority of necessary funding and are working on acquiring the balance, according to Marco Lemes, project manager with the Sacramento Municipal Utility District’s Dairy Digester Incentives Program. Both also qualified for grants under the U.S. DOE’s Community Renewable Energy Deployment (CRED) grant program under the Recovery Act.

 SMUD, one of the ten largest publicly-owned utilities in the U.S., assists developers in implementing AD projects, and purchases the resulting electricity through power purchase agreements under a feed-in tariff rate. SMUD helps developers acquire grant money, and also provides expertise in project development. “We’ve been through this before—obtaining grants, permitting, interconnection and working with farmers,” Lemes said. “We funnel them [developers] money from the DOE in compliance with grant dispersal regulations, and we’re often the middle man between the developer and the farmer.”

 Though both the New Hope and Van Warmerdam dairy facilities are 1,200-cow farms, the projects are utilizing different technologies, according to Lemes. “The New Hope project is an above-ground tank, and Warmerdam is a lagoon digester,” he said.  “Above ground tanks are significantly more expensive, but they produce more biogas, potentially improving the economics of the project.”

 New Hope will have an electric capacity of about 350 KW; Van Warmerdam 450 KW. Both will be using just manure initially, but the developers intend to look into co-digestion, Lemes said. “Manure-only is much easier, because once you add other organic feedstocks, such as food waste, there are lot more complexities in obtaining permits for the water discharge,” he said. “Once you add other organic wastes, it increases biogas production significantly and improves the economics of the project, but that will take some time. There are many discussions in California about co-digestion, but there has been little pracitical application. Regulations for codigestion are still pretty tough. It's too expensive and complex to meet requirements of the local water board.”

 Neither projects have begun construction, but will once they have secured the remaining capital required. “That’s probably the hardest part of developing these kinds of projects,” Lemes said. He said the $1.7 million Warmerdam facility was awarded roughly $900,000 in grants toward the $1.7 million project cost, and may begin construction by the end of the first quarter this year.

The $3.4 million New Hope project plans to begin construction this summer, and both hope to be operating by the end of the year.