These are challenging times for dairy farms of all sizes.
Milk prices continue to be low and feed costs high causing dairies to look for ways to diversify and enhance income streams. Furthermore, managing manure and controlling on-farm methane emissions from farm operations is becoming a costly challenge for farmers that most would like to avoid. This is catalyzing interest from dairies to consider on-farm anaerobic digestion as a tool to sequester methane and provide supplemental income. But to go it alone, without professional development and operation and a market for the energy produced, has proven difficult and inefficient. Recognizing this and with a strong understanding and commitment surrounding the challenges farm families face today and a desire to work alongside them to provide a solution, Vanguard Renewables launched its organics to renewable energy business more than eight years ago. Now with six successfully operating Farm Powered anaerobic digesters, four currently under construction and 100 planned, Vanguard is the farm-based anaerobic digestion leader.
This is not a solitary achievement. It is one shared by our dairy partners who also have the vision to turn farm waste into revenue in order to sustain their farms for future generations. And it is also emblematic of industry partnership on the dairy side by Dairy Farmers of America, which joined forces with Vanguard several years ago to bring viable anaerobic digester technology and operation to farms across the country. Furthermore, forward-thinking utilities, notably Dominion Energy, are supporting the farm-based organics to renewable energy movement by committing to offtake and condition the farm-derived gas produced and delivering it to consumers as renewable natural gas for thermal load or as compressed natural gas for vehicle fuel.
This is appealing alone but another key benefit of hosting an on-farm anaerobic digester is the low carbon liquid digestate fertilizer by-product of the anaerobic digestion process that can replace synthetic fertilizers thereby reducing a large farm expense and maintaining good soil health.
Two Anaerobic Digestion Models Provide Expansive Possibilities
One is dairy waste only to renewable natural gas that is a focus of Vanguard Renewables Ag. This model is best for larger dairies and pods of several dairies in order to collect and process enough manure to produce commercial-scale quantities of renewable natural gas for pipeline injection or conversion into vehicle fuel. A typical dairy waste to renewable energy project consists of a minimum cluster of 10,000 plus dairy cows on one to four farms. A 20,000-cow dairy produces approximately 760 mmbtu/day of renewable natural gas – the equivalent Manure is collected and processed in the anaerobic digester and the methane produced from dairy manure is captured through Farm Powered anaerobic digestion and is then transported through low-pressure gathering lines to a central conditioning facility. The gas is processed and cleaned of any impurities and delivered to local consumers through the existing underground distribution network.
The second model, typically a single anaerobic digestion facility on a dairy farm with 350 to 1000 cows, combines food and beverage waste and dairy waste in an anaerobic digester to produce renewable natural gas. These facilities need to be in proximity to metropolitan areas, where ample food and beverage waste is available to catalyze the anaerobic digestion process. Vanguard Renewables develops, owns, and operates these facilities.
In both cases, no capital investment is required from the farm. Vanguard Renewables supplies 100 percent of the capital for the project and also the professional management of the facility once construction is completed.
Vanguard Launches the Farm Powered Strategic Alliance with Food Industry Leaders
Alongside founding members Unilever, Starbucks, and Dairy Farmers of America, Vanguard recently launched the Farm Powered Strategic Alliance committed to reducing waste and repurposing unavoidable waste from manufacturing and supply chain operations at Farm Powered anaerobic digesters. The Alliance is also committed to shifting thermal load from fossil fuels to renewable natural gas. The group is expanding rapidly and will be aligned with Vanguard’s farm and food waste to renewable energy model.
Industry and Utility Partnerships Ensure Projects and Profits
Vanguard Renewables’ partnership with Dairy Farmers of America (DFA) has enabled the expansion of the Farm Powered anaerobic digestion program to more farms across the country and is an instrumental part of DFA’s ability to meet aggressive science-based targets announced in late 2020. Additionally, Vanguard has existing gas offtake agreements with national utilities such as Dominion Energy and Vermont Gas Systems that ensure a market for the renewable natural gas produced at a Farm Powered facility. All of this leaves farmers to do what they do best – manage the farm.
Vanguard Renewables Ag and Dominion Energy Partnership
In 2019, Vanguard Renewables Ag and Dominion Energy launched what began as a $200 million strategic partnership and is growing. This partnership is a key factor in expanding the availability of anaerobic digestion to farms across America and in delivering clean, renewable energy to millions of U.S. consumers. It is the largest waste to energy program of its kind in the U.S. and will result in greenhouse gas emission reductions equivalent to taking 100,000 cars off America’s roads or planting 8 million new trees. With Vanguard Renewables Ag and Dominion Energy, dairies across the country have partners with substantial financial resources, a deep understanding and commitment to the dairy industry, and a proven dairy waste-to-energy, renewable natural gas production track record.
New Construction Underway
With new construction of Farm Powered anaerobic digesters in Colorado, Georgia, New York, and Nevada, and projects in development nationwide including Pennsylvania, Texas, Arizona, Wisconsin, Minnesota, Idaho, New Mexico, Kansas, and Florida, Vanguard is leading the dairy waste to renewable energy movement across America. The Farm Powered program will have a meaningful impact on greenhouse gas sequestration that will significantly benefit the farm community and the environment for generations to come.
The Story of the Melnik Family’s Bar-Way Farm and the Farm Powered Anaerobic Digester Program
Bar-Way farm is in Deerfield, Mass., is about 90 miles west of Boston in the Connecticut River Valley. The farm, in the Melnik family for 101 years, milks 300 cows and grows butternut squash, corn, hay, and hemp for CBD oil. Following a multi-year process, the farm began hosting a Farm Powered anaerobic digester in 2016 that was developed and is owned and operated by Vanguard Renewables.
“I think the most important advice I can give to other farmers is to use all of the assets that you have,” comments Peter Melnik. “When I came back to the farm in the 90s, I realized we were underutilizing our manure, and we needed to do more. At that time, there were very few anaerobic digesters in the United States, and most were not operating well.”
Melnik goes on to explain that in 2010 the farm became a part of the group of farmers and others looking at how to effectively add and run digesters on farms that could take food waste from the city of Boston. After building one digester and starting a second, the group realized they could not acquire the capital to self-fund these projects and they disbanded. Melnik remained interested in hosting a digester on his farm and following extensive research into technology providers, management companies, and investors, he found that there was numerous differing agendas and a lack of an actual pathway forward toward digester development and operation. Melnik also realized that permitting such a project was daunting and time consuming and would distract him from running the farm.
“At this point, Vanguard Renewables approached me about hosting one of their Farm Powered anaerobic digester projects on the farm and offered me part ownership in the digester and a platform in which they would finance, develop, own, and operate the anaerobic digester,” Melnik adds. “In this scenario, I would be able to what I do best – farm. And I could still benefit my farm by making it more environmentally and financially sustainable.”
In addition to the payment Bar-Way Farm receives for hosting the Farm Powered anaerobic digester that was completed in 2016, Bar-Way gets the low-carbon digestate fertilizer to use on the farm’s 600 acres of crops.
“I was buying commercial fertilizer and now I’m using solely digestate and it is working phenomenally,” Melnik says. “We‘ve seen a 20 percent increase in crop yields and had a fantastic hemp crop this year due to using the digestate. Also, the 90 percent odor reduction from farm operations is a great side benefit that my neighbors really appreciate.”
Melnik adds that deciding to host a digester is a major decision. He says farmers need to do their homework, take their time, and make sure a digester will serve their farm.
“One thing that is really key is finding a digester developer and management firm that isn’t just there to make money but understands that the farm has to benefit as well. Vanguard Renewables is an excellent partner who cares about the farm and that builds the program that will have the maximum benefits for each farm partner.”
Editor’s note: Kevin Chase is Co-founder and Chief Investment Officer of Vanguard Renewables LLC overseeing the company’s investments and managing all permitting, design and construction activities. Vanguard is an institutionally backed renewable energy company developing and operating anaerobic digesters on dairy farms in the United States. Chase is also Chief Executive Officer of Vanguard Renewables Ag; a venture launched in November 2019 with Dominion Energy and Dairy Farmers of America to develop and operate a national portfolio of Farm Powered anaerobic digesters to sustainably process large quantities of dairy manure and produce renewable natural gas to be sold throughout North America. He has more than 25 years of experience in development, real estate, finance, and acquisitions. He can be reached at Kchase@vanguardrenewables.com