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Making money from waste: The economic viability of producing biogas and biomethane in the Idaho dairy industry

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  • Lauer, Markus
  • Hansen, Jason K.
  • Lamers, Patrick
  • Thrän, Daniela

Abstract

Farm operations in the USA and Europe have seen a radical change in the last decades: small sized farms are disappearing, and farm size and total livestock on larger farms are increasing. The resulting spatial density of animals causes several environmental impacts. Anaerobic digestion is one promising technical solution to alleviate most of these impacts while simultaneously providing a regional energy source. This analysis assesses the economic viability of using dairy-cow manure for either (i) the on-farm production and use of biogas to generate electricity and heat or (ii) the upgrading biogas to biomethane, a natural-gas substitute. A non-linear optimization model was developed to optimize plant capacity for anaerobic digestion and maximize the net present value for each option by farm size. In this study, we used Idaho‘s dairy farms as a case study. The analysis implies that at least 3000 cows per farm are required for an economically viable anaerobic-digestion plant operation. For farms with up to 3600 animals, the highest net present value was achieved for the on-farm use of biogas. Farms larger than that achieved their best economic results via the production of biomethane. In total about 45% of Idaho’s dairy manure could be utilized by economically feasible biogas and biomethane plants. A higher manure utilization rate could be achieved through joint, cooperative anaerobic digestion plants and manure transportation. The results can be transferred to other regions and countries, respectively, to reduce the negative impact of intensive livestock farming.

Suggested Citation

  • Lauer, Markus & Hansen, Jason K. & Lamers, Patrick & Thrän, Daniela, 2018. "Making money from waste: The economic viability of producing biogas and biomethane in the Idaho dairy industry," Applied Energy, Elsevier, vol. 222(C), pages 621-636.
    • Handle: RePEc:eee:appene:v:222:y:2018:i:c:p:621-636
    DOI: 10.1016/j.apenergy.2018.04.026
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    1. Al-Fatesh, Ahmed Sadeq & Hanan atia, & Ibrahim, Ahmed Aidid & Fakeeha, Anis Hamza & Singh, Sunit Kumar & Labhsetwar, Nitin K. & Shaikh, Hamid & Qasim, Shamsudeen O., 2019. "CO2 reforming of CH4: Effect of Gd as promoter for Ni supported over MCM-41 as catalyst," Renewable Energy, Elsevier, vol. 140(C), pages 658-667.
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    3. Zhang, Lihui & Wang, Jianing & Li, Songrui, 2022. "Regional suitability analysis of the rural biogas power generation industry:A case of China," Renewable Energy, Elsevier, vol. 194(C), pages 293-306.
    4. Felipe Solferini de Carvalho & Luiz Carlos Bevilaqua dos Santos Reis & Pedro Teixeira Lacava & Fernando Henrique Mayworm de Araújo & João Andrade de Carvalho Jr., 2023. "Substitution of Natural Gas by Biomethane: Operational Aspects in Industrial Equipment," Energies, MDPI, vol. 16(2), pages 1-19, January.
    5. Keogh, Niamh & Corr, D. & O'Shea, R. & Monaghan, R.F.D., 2022. "The gas grid as a vector for regional decarbonisation - a techno economic case study for biomethane injection and natural gas heavy goods vehicles," Applied Energy, Elsevier, vol. 323(C).
    6. Sadie Woolery & Edward Osei & Mark Yu & Selin Guney & Ashley Lovell & Hussain Jafri, 2023. "The Carbon Footprint of a 5000-Milking-Head Dairy Operation in Central Texas," Agriculture, MDPI, vol. 13(11), pages 1-16, November.
    7. Şenol, Halil & Ali Dereli̇, Mehmet & Özbilgin, Ferdi, 2021. "Investigation of the distribution of bovine manure-based biomethane potential using an artificial neural network in Turkey to 2030," Renewable and Sustainable Energy Reviews, Elsevier, vol. 149(C).
    8. D’Adamo, Idiano & Falcone, Pasquale Marcello & Huisingh, Donald & Morone, Piergiuseppe, 2021. "A circular economy model based on biomethane: What are the opportunities for the municipality of Rome and beyond?," Renewable Energy, Elsevier, vol. 163(C), pages 1660-1672.
    9. Schiochet Pinto, Luane & Pinheiro Neto, Daywes & de Leles Ferreira Filho, Anésio & Domingues, Elder Geraldo, 2020. "An alternative methodology for analyzing the risk and sensitivity of the economic viability for generating electrical energy with biogas from the anaerobic bio-digestion of vinasse," Renewable Energy, Elsevier, vol. 155(C), pages 1401-1410.
    10. Lauer, Markus & Leprich, Uwe & Thrän, Daniela, 2020. "Economic assessment of flexible power generation from biogas plants in Germany's future electricity system," Renewable Energy, Elsevier, vol. 146(C), pages 1471-1485.
    11. Diego Teixeira Michalovicz & Patricia Bilotta, 2023. "Impact of a methane emission tax on circular economy scenarios in small wastewater treatment plants," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(7), pages 6575-6589, July.
    12. Li, Xue & Mupondwa, Edmund, 2018. "Commercial feasibility of an integrated closed-loop ethanol-feedlot-biodigester system based on triticale feedstock in Canadian Prairies," Renewable and Sustainable Energy Reviews, Elsevier, vol. 97(C), pages 401-413.
    13. Struhs, Ethan & Mirkouei, Amin & You, Yaqi & Mohajeri, Amir, 2020. "Techno-economic and environmental assessments for nutrient-rich biochar production from cattle manure: A case study in Idaho, USA," Applied Energy, Elsevier, vol. 279(C).
    14. Zhao, Ning & You, Fengqi, 2019. "Dairy waste-to-energy incentive policy design using Stackelberg-game-based modeling and optimization," Applied Energy, Elsevier, vol. 254(C).
    15. Adam Wąs & Piotr Sulewski & Vitaliy Krupin & Nazariy Popadynets & Agata Malak-Rawlikowska & Magdalena Szymańska & Iryna Skorokhod & Marcin Wysokiński, 2020. "The Potential of Agricultural Biogas Production in Ukraine—Impact on GHG Emissions and Energy Production," Energies, MDPI, vol. 13(21), pages 1-20, November.
    16. Patrycja Pochwatka & Alina Kowalczyk-Juśko & Piotr Sołowiej & Agnieszka Wawrzyniak & Jacek Dach, 2020. "Biogas Plant Exploitation in a Middle-Sized Dairy Farm in Poland: Energetic and Economic Aspects," Energies, MDPI, vol. 13(22), pages 1-17, November.
    17. Grzegorz Piechota & Bartłomiej Igliński, 2021. "Biomethane in Poland—Current Status, Potential, Perspective and Development," Energies, MDPI, vol. 14(6), pages 1-32, March.
    18. Cudjoe, Dan & Nketiah, Emmanuel & Obuobi, Bright & Adu-Gyamfi, Gibbson & Adjei, Mavis & Zhu, Bangzhu, 2021. "Forecasting the potential and economic feasibility of power generation using biogas from food waste in Ghana: Evidence from Accra and Kumasi," Energy, Elsevier, vol. 226(C).
    19. Barbera, Elena & Menegon, Silvia & Banzato, Donatella & D'Alpaos, Chiara & Bertucco, Alberto, 2019. "From biogas to biomethane: A process simulation-based techno-economic comparison of different upgrading technologies in the Italian context," Renewable Energy, Elsevier, vol. 135(C), pages 663-673.

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