Tag: renewable natural gas

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Renewable Natural Gas – Economics


Can We Approach Anaerobic Digestion Differently?

Anaerobic digestion (AD) system installations are costly and projects vary significantly depending on local circumstance. One possible business model proposed to improve the economic performance of AD systems is to use the biogas as renewable natural gas (RNG) rather than heat and electricity. Washington State University partnered with state agencies and a private project developer to study the feasibility of adding RNG to an existing commercial AD project in the Yakima Valley of Washington State.

What did we do?

We examined three alternative AD system modifications: (a) combined heat and power, which is the baseline system; (b) boiler as a substitute for combined heat and power; and (c) renewable natural gas infrastructure. Our primary objective was to highlight the findings of a case study (Coppedge et al., 2012), particularly the identification of various factors that may affect the feasibility of an AD project. We answered the following questions:

  1. What is the importance of the relative difference of an AD project’s operating cost with respect to its capital cost?
  2. How do different end-uses for biogas (e.g., heat, electricity, renewable natural gas for pipeline or transportation fuel) affect the profitability of a digester project?
  3. How important is revenue from fiber and nutrient co-products to digester profitability?
  4. How important are environmental payments (Renewable Energy Certificates, Renewable Fuel Standards credit, carbon credits) to digester profitability?

This presentation focuses on questions 2 and 4 – end-uses for biogas and environmental payments tied to the alternative renewable energy options.

What have we learned?          

RNG offers promising opportunities. When available and potential renewable fuel credits are added to the commodity price of RNG, the AD project with this system can generate more net returns than with a combined heat and power system (baseline). Furthermore, if renewable fuel is sold as transportation fuel in the retail compressed natural gas market, the renewable natural gas system is more profitable than the baseline system with or without the addition of environmental incentives.Table 1. Average annual operating and capital costs of an anaerobic digester project under different configuration systems

 

Figure 2. AD system revenue from multiple sources, as percentage of average annual gross revenue.

Future Plans  

We have published a fact sheet (forthcoming) through WSU Extension providing a synthesis of the economic evaluation from the main feasibility study. This fact sheet (EM090E) is part of an Anaerobic Digestion Systems Manual under development with support from USDA NIFA.

Authors      

Chad Kruger, Director, WSU CSANR cekruger@wsu.edu

Suzette Galinatto, Research Associate @ WSU IMPACT Center; Craig Frear, Assistant Professor @ WSU Biological Systems Engineering

Additional information

Coppedge, B., G. Coppedge, D. Evans, J. Jensen, E. Kanoa, K. Scanlan, B. Scanlan, P. Weisberg and C. Frear. 2012. Renewable Natural Gas and Nutrient Recovery Feasibility for DeRuyter Dairy: An Anaerobic Digester Case Study for Alternative Off-take Markets and Remediation of Nutrient Loading Concerns within the Region. A Report to Washington State Department of Commerce. <http://csanr.wsu.edu/publications/deRuyterFeasibilityStudy.pdf>.

Galinatto, S.P., C.E. Kruger, and C.S. Frear (2015). Anaerobic Digester Project and System Modifications: An Economic Analysis. WSU Extension Publications EM090E.

Acknowledgements      

This project was supported by the WSU ARC Biomass Research Program, and USDA National Institute of Food and Agriculture Award #2012-6800219814.

The authors are solely responsible for the content of these proceedings. The technical information does not necessarily reflect the official position of the sponsoring agencies or institutions represented by planning committee members, and inclusion and distribution herein does not constitute an endorsement of views expressed by the same. Printed materials included herein are not refereed publications. Citations should appear as follows. EXAMPLE: Authors. 2015. Title of presentation. Waste to Worth: Spreading Science and Solutions. Seattle, WA. March 31-April 3, 2015. URL of this page. Accessed on: today’s date.

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The Dairy Manure Biorefinery


Why Consider Additional Technologies with Anaerobic Digestion?

Some dairy farms have experimented with “add-on” technologies to enhance the value of the products generated from anaerobic digesters to improve economics and address other environmental and management concerns. This effort has intensified in recent years, as prices paid for electricity continue to fall. This trend is making it more difficult to justify the installation of new digesters or maintain active anaerobic digestion (AD) projects based on electricity sales alone. 

What did we do?

Based on ten years of research and extension within the field of dairy digesters, we are proposing that the concept of a dairy manure biorefinery can be useful to focus ongoing research and commercialization efforts (Figure 1). A biorefinery integrates a core biomass conversion process (in this case, AD, converting manure and in many cases other organic substrates) with additional downstream technologies. These combined technologies generate multiple value-added products including fuels, electricity, chemicals, and other products (NREL, 2009). Most add-on technologies relevant to dairy facilities have been modified from technologies used in the wastewater treatment and oil and gas industries. 

What have we learned?

Ongoing research and commercialization efforts by our team and others aim to:

  • Adapt technologies to fit the economic and other constraints of dairy digesters.
  • Increase efficiency and reduce costs by maximizing the complimentary nature of technologies (e.g. waste heat from one process is used in another process).

Specific add-on technologies that are continuing to evolve within the biorefinery context include:

Biogas Upgrading to remove impurities from biogas (primarily carbon dioxide, hydrogen sulfide, and water vapor).

Output: Purified biogas that can be used as a transportation fuel (e.g. liquefied natural gas) or injected directly into natural gas piplelines.

Additional social and economic benefits: Renewable fuel can reduce demand for fossil fuels, and can often receive economic credits (e.g. renewable identification numbers, low carbon fuel standard)

Fiber Upgrading to process the fiber that is removed from AD effluent.

Output: Upgraded fiber can be sold as a higher-value soil amendment in the horticultural industry

Additional social and economic benefits: Fiber can replace use of non-renewable resource (peat moss) by horticultural industry

Nutrient Recovery to strip nitrogen (N) and phosphorus (P) from anaerobic digester effluent.

Outputs: Soil amendment products that can be sold offsite where nutrients are needed

Additional social and economic benefits: Reductions in N and P applied to nearby fields, and reduced effluent hauling distances/costs for land application due to lower nutrient concentration in effluent

Water Recovery to generate “recycled” water using advanced technologies

Output: Water that can be used for animal drinking, or as dilution water for the AD facility

Additional social and economic benefits: Reduces consumption of fresh water, a limited resource, and reduces costs for land-application of AD effluent

Overall Potential Impact. Improving economics and addressing other critical issues for dairy producers (e.g. nutrient issues) has the potential to advance farm-based AD adoption significantly beyond its current 244 farms. It has been estimated that a mature bio-refinery industry based on AD on large U.S. dairy farms could create an estimated bio-economy of nearly $3 billion that complements the production of milk and dairy products (ICUSD, 2013).

Figure 1. Stepwise depiction of the process

Figure 2. Total likely value added by most likely scenario

Authors

Georgine Yorgey (presenting author)a, Craig Frearb, Nick Kennedya, Chad Krugera, Jingwei Mab, and Tara Zimmermana

a Center for Sustaining Agriculture and Natural Resources, Washington State University

b Department of Biological Systems Engineering, Washington State University

Future Plans

An extension document describing this concept and the add-on technologies in additional detail is being prepared. This document is part of a series of extension documents on Dairy AD Systems, being prepared by the authors and other colleagues at Washington State University. In addition, ongoing work and collaborations by our team are seeking to investigate, evaluate, and improve individual technologies and the linkages amongst them.

Additional Information

ICUSD, 2013. National market value for anaerobic digestion products. Report to Innovation Center for US Dairy, August 2013.

Acknowledgements

This research was supported by USDA National Institute of Food and Agriculture, contract #2012-6800219814; and Biomass Research Funds from the Washington State University Agricultural Research Center.

The authors are solely responsible for the content of these proceedings. The technical information does not necessarily reflect the official position of the sponsoring agencies or institutions represented by planning committee members, and inclusion and distribution herein does not constitute an endorsement of views expressed by the same. Printed materials included herein are not refereed publications. Citations should appear as follows. EXAMPLE: Authors. 2015. Title of presentation. Waste to Worth: Spreading Science and Solutions. Seattle, WA. March 31-April 3, 2015. URL of this page. Accessed on: today’s date.

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Renewable Natural Gas – Biogas Cleaning and Upgrading 101

With depressed electrical prices for produced biogas, many projects are now moving towards business models predicated on production of renewable natural gas (RNG). In order to produce RNG, projects must first clean and upgrade raw biogas to pipeline and/or transportation fuel quality through the use of various engineering approaches. In this presentation, an overview of available and emerging biogas cleaning and upgrading technologies are discussed, highlighting positives, negatives and costs.  

Who Should Consider Biogas Cleaning?

The aim of this fact sheet is to provide farmers, third party project developers, regulatory agencies, and other stakeholders with a basic understanding of the chemical composition of renewable natural gas, the most appropriate end use options for dairy digesters, and some of the more common techniques used to clean biogas to RNG quality at dairy digesters.

What did we do? 

The authors utilized years of research and industry expertise as well as thorough literature search describe the concept of renewable natural gas and the technologies to clean the biogas. The authors aimed to provide information based on the current literature, but not to favor one technology over another.

What have we learned? 

When CHP is the end-use of biogas, the most common biogas purification approach for dairy digesters in the US is to remove water vapor and hydrogen sulfide. Existing projects use a variety of approaches, ranging from biological processes (both post digestion and via oxygen injection into the digester) to physical-chemical absorption processes such as iron type-sponge or activated carbon.

However, if RNG is the end-use a higher degree of purity is required. Often times a dedicated water vapor removal unit and hydrogen sulfide scrubbing unit is still required for removal of the bulk of the hydrogen sulfide mass. Thereafter, water scrubbing or PSA are often used to remove carbon dioxide from biogas, producing an RNG fuel that can be utilized in a variety of different ways. Other technologies exist, however their application on dairy digesters has been rather limited due to concerns related to maturity, cost, and complexity. The best technique is also situation-specific, and therefore, it is critical to understand the mechanics of each purification process, its limitations, and its economics before making a decision.

As electrical rates continue to drop throughout the PNW and US, current and new AD project developers are strongly considering a shift from CHP towards higher value end-uses for biogas, particularly RNG. Interest is increasing due to a growing CNG industry in the US, the decoupling of CNG and diesel prices, and the potential for competitive pricing and high revenues in comparison to fossil-CNG, given existing government incentives. Projects are presently limited and business models must still be proven before wide-scale adoption of biogas upgrading technologies within a dairy digester platform. In addition, concerns historically plaguing CHP projects, related to power purchase agreement pricing, interconnection fees, and scaling are still potentially present within a pipeline fuel model. Nonetheless, the potential exists for a new business model approach to AD projects on US farms.

Future Plans 

No future plans.

Authors

Craig Frear, Assistant Professor, Washington State University cfrear@wsu.edu

Nick Kennedy, Associate in Research WSU; Georgine Yorgey, Associate in Research WSU; Dan Evans, President Promus Energy; Jim Jensen, Associate in Research, WSU Energy; Chad Kruger, DIrector WSU CSANR

Additional information 

For those seeking additional detail, or information about other technologies, more comprehensive reports and reviews are available (Jensen, 2011; Krich et al., 2005; Ryckebosch et al., 2011). This publication is part of the Anaerobic Digestion Systems Series, which aims to provide information that improves decision-making for anaerobic digestion systems.

Acknowledgements

This research was supported by funding from USDA National Institute of Food and Agriculture, Contract #2012-6800219814; National Resources Conservation Service, Conservation Innovation Grants #69-3A75-10-152; Biomass Research Funds from the WSU Agricultural Research Center; and the Washington State Department of Ecology, Waste 2 Resources Program.

The authors are solely responsible for the content of these proceedings. The technical information does not necessarily reflect the official position of the sponsoring agencies or institutions represented by planning committee members, and inclusion and distribution herein does not constitute an endorsement of views expressed by the same. Printed materials included herein are not refereed publications. Citations should appear as follows. EXAMPLE: Authors. 2015. Title of presentation. Waste to Worth: Spreading Science and Solutions. Seattle, WA. March 31-April 3, 2015. URL of this page. Accessed on: today’s date.

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