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Piggeries: destruction of methane generated from manure– slides 6 June 2013

Carbon Farming Initiative workshop: from Plan to Practice – slides

Piggeries: destruction of methane generated from manure 2013 These slides are also available in PDF format on the Clean Energy Regulator website1.

1 http://www.cleanenergyregulator.gov.au/Carbon-Farming-Initiative/Reports-and-publications/Pages/default.aspx

Piggeries: destruction of methane generated from manure – slides 6 June 2013

Welcome • Introductions

• Housekeeping

Workshop purpose

• Support your participation

• Help you to understand what's involved

Introduction

Purpose:

• Understand Clean Energy Regulator’s role

• Understand key concepts behind the Carbon Farming Initiative’s operation

Clean Energy Regulator

Our vision is to support Australia in transitioning to a low carbon economy through an informed and efficient market for carbon and investment in renewable energy.

Other government organisations

Three government organisations have a role in the Carbon Farming Initiative:


Department of Agriculture, Fisheries and Forestry

Provides information and support for landholders and funds research

Department of Industry

Development of policy, legislation and methodologies

Clean Energy Regulator

Assessment of projects, education, issue of Australian carbon credit units

Video: how the Carbon Farming Initiative works

View the video, how the Carbon Farming Initiative works2, on YouTube.

Australian Government response to Climate Change

• International: Kyoto Agreement

• Domestic: Reduction in greenhouse gas pollution using the market » Carbon pricing mechanism

How the Carbon Farming Initiative works

• You can earn Australian carbon credit units (ACCUs) by: » storing carbon, or » reducing greenhouse gas emissions on the land

• 1 ACCU = 1 tonne of carbon dioxide equivalent (CO2-e).

Methodology determinations

Methodology determinations set out the rules for undertaking a specific activity to earn Australian carbon credit units.

Industry perspective: Australian Pork Limited • Pork’s carbon footprint

• Opportunities for the pork industry

2 http://www.youtube.com/watch?v=uBj7xc3ZKWg


Presenters: Janine Price, Manager Environment and Climate Change, Australian Pork Limited

Sam Lawrence, Senior Policy Analyst, Australian Pork Limited

Australian Pork Limited

The Carbon Farming Initiative: From Plan to Practice

Sam Lawrence, Senior Policy Analyst

Janine Price, Manager, Environment

APL and the Australian pork industry

APL

• Australian Pork Limited (APL) is the peak national representative body for Australian pig producers.

• It is a producer-owned not-for-profit company combining marketing, export development, research & innovation and strategic policy development to assist in securing a profitable and sustainable future for the Australian pork industry.


Cost of production

• Cost of production for Australian pork is high. - ie labour, feed grain, energy

• Subsidisation in export markets.

Pork’s carbon footprint

• Livestock accounts for 66% of Aust. agriculture’s greenhouse gas (GHG) emissions, which amounts to approx 16% of Australia’s total GHG emissions.

• Pork production represents just 0.4% of livestock greenhouse gas emissions. • Most of our emissions (nearly 70%) come from the effluent system. This offers a

significant opportunity to reduce.


Pork’s carbon footprint

• A recent APL funded project analysed these options and showed that emissions from effluent treatment may be reduced by 62-80%.

• Treatments for capturing and destroying CH4: » Covered Anaerobic ponds (CAPs) with flaring (CAP-F) » Methane for heat to offset farm gas use (CAP – G) » Combined heat & power generation on farm (CAP-CHP) » Transporting effluent off site to a centralised anaerobic digestion plant (CAD)

• Potential to have the lowest GWP for pork production worldwide.

• Significant opportunity to reduce ecological footprint, reduce energy inputs, differentiate our product and promote the industry’s environmental credentials.


The Carbon Farming Initiative

Opportunities

• The Carbon Farming (CFI) is a carbon offsets scheme that allows pig farmers to earn carbon credits by reducing GHG emissions

• APL provided input into policy and legislation. Worked in partnership with Government- CER, DCCEE, DAFF

• The Aust. Pork industry was the first Industry to have a methodology endorsed and approved by government – “Destruction of methane generated from manure in piggeries” - Developed by APL, DCCEE and industry experts.

• Second methodology recently approved for biodigesters

• Other opportunities for reduction of GHG


Example

• A 5000 standard production unit (SPU) piggery would produce ≈103,500m3 of methane per year, (≈1556t CO2 equivalent per year).

• With CFI credits of approximately $16/T, at $2.45 per finished pig @ 9900 pigs = $24,255 per year.

CFI: Case Study

Blantyre farms

• Blantyre Farms (Young, NSW) was the first piggery in Aust. to secure approval to participate in the CFI scheme.

• With 22,000 pigs, Blantyre Farms installed a biogas system to generate electricity from manure by covering an effluent pond - powers the entire farm

• The owners, no longer pay $15,000 a month for electricity and gas, but earn $5,000 a month from the power sold back to the electricity grid.

• Blantyre Farms generates CFI credits and renewable energy certificates from the project.

APL and the Pork CRC

APL

• APL priorities continue to focus on GHG mitigation on-farm.

• There are several projects, including covered ponds and the Biogas Code.

• The National Agricultural Manure Management Program (NAMMP) is worth $6.19m (with $2.97m from DAFF) with other RDCs to address knowledge gaps leading to further CFI methodologies for producers.

Pork CRC

• The bio-energy support program offers free advice for producers.

• Dr Stephan Tait – University of Queensland Ph: 0466 699 817.

• NAMMP is currently running a project on solid manure in anaerobic digesters.


Guide to undertaking a piggeries – destruction of methane generated from manure project • Support your decision to participate in the Carbon Farming Initiative, using the piggeries

methodology

What does a piggery project look like?

• Manure treated in a covered pond

• Pond contains only manure from operations of piggery sheds

• Gas from the covered pond is collected and combusted: » Flare » Electricity generation system » Gas boiler

• Use PigBal model to calculate carbon abatement.

Why participate?

• Capturing emissions from effluent ponds has several benefits

• Earn Australian carbon credit units (ACCUs) and sell these for a financial benefit

• Watch the video3.

How do I get started?

• Check your eligibility

• Assess the feasibility

• Check your expectation for return on investment

• Decide on your business model

• Apply: » Recognised Offsets Entity » ANREU account » Eligible Offsets project

How do I undertake a piggery project?

• Meet eligibility requirements

3 http://www.cleanenergyfuture.gov.au/video/grantham-piggery/


» Flare » Electricity generation » Gas boiler

• Maintain your equipment

• Measure inputs to PigBal

PigBal Model is a computer program that predicts piggery manure production. Model inputs include daily herd information, weekly.

Project boundary

• Baseline: » Greenhouse gas emissions from treatment pond (methane - CH4)

• Project activity: » Electricity from the grid, fuel used for gas capture and combustion (CO2, N20, CH4) » Gas capture and combustion (N20, CH4)

Measure and calculate abatement

• Baseline calculation

• Greenhouse gas abatement calculation

• Monitor

• Use PigBal

Monitoring and record keeping

• Project information

• Combustion device information

• Monitoring and gas composition information

• Direct and indirect measurement (inputs and outputs from PigBal)

• Other records


Quality assurance and control matters

More on record keeping

• Monitoring data is crucial to your application for ACCUs. Will you be able to protect your data in an unforseen event?

Audit report

Provides a ‘reasonable assurance’ opinion on whether or not your project complies with the methodology determination and Carbon Farming legislation

Apply for carbon credits

• Submit offsets report and audit report to the Clean Energy Regulator

• Australian carbon credit units (ACCUs) are issued into your account in the Registry

• Earn money by selling the ACCUs and transferring them to another account in the Registry

Question and answer panel • Introduction to Carbon Farming Initiative and Clean Energy Regulator

• Australian Pork Limited

• What does a project look like?

• Measure and calculate abatement

• Audit


Case Study: Technical Aspects of a Piggery Biogas project Presenter: Stephan Tait, University of Queensland, Advanced Water Management Centre and Pork CRC

Technical aspects of a Piggery Biogas Project

Roseworthy

7 June 2013

Pork CRC Bioenergy Support Program4

Stephan Tait, PhD, CEng(IChemE)

This presentation is provided for general information purposes and should NOT be used as a substitute for professional advice.

Outline

• Why can burning of piggery biogas produce carbon credits?

• What equipment do you need for a piggery project?

• What does the equipment cost?

• Where are the greatest returns?

• Some tips…

Where do the carbon credits come from?

4 http://porkcrc.com.au/research/program-4/bio-energy-support-program/


Biogas to Carbon Credits

Biogas covers

Biogas flaring

This slide shows 2 images of biogas flaring. • Flare pilots burn with nearly invisible blue flame.

• Flame difficult to see in day, visible at night – use IR, TC or UV to monitor. *Manufacturers or suppliers for which photos of infrastructure are shown are neither endorsed nor recommended. Photos are only shown for illustrative purposes.


Biogas flaring

• Flow meter shows how much methane is being sent to the flare to be burnt

• Temperature probe or UV sensor confirms that the flare is actually operational and is burning the methane sent to it

Biogas heating


• This slide has 1 image of a system used for biogas heating. Photo credit to Skerman et al, RIRDC, 2012

Power generation

This slide has 3 images of power generators.

• Methane (in biogas) + air and spark = energy = electricity


Biogas cleaning

• This slide has 7 images of equipment on farm used for biogas cleaning. Images courtesy Skerman and Collman, RIRDC, 2012


How much does it cost? What are the potential returns?

Number of sows Cost Return time

< 400 < $200k 5+ year payback

400-500 $200-300k 4-5 year payback

1000-1500 $400-600k 3-5 year payback

2000+ $1000k 2-3 year payback

Indicative only, based on projects to date, can be substantially different and should be assessed on a site-by-site basis. Not to be interpreted as financial advice.

Combined Heat and Power – Capital Cost Spread

* Indicative only, based on projects to date, can be substantially different and should be assessed on a site-by-site basis. Not to be interpreted as financial advice


Biogas return – breakdown

*Indicative only, based on projects to date, can be substantially different and should be assessed on a site-by-site basis. Not to be interpreted as financial advice.


Energy distribution

• This slide has 5 images showing how energy can be distributed from grower-finisher sheds where there are high manure volumes and minimal energy requirements to breeder pigs sheds where there are low manure volumes and high energy demand for heating (lamps)


Contributors

• Tom Smith (Kia-ora)

• Ian Connaughton (Don KRC)

• Ken Cameron (Cameron Pastoral)

• Edwina and Michael Beveridge (Blantyre Farms)

• Eugene McGahan (FSA – Pork CRC Feasibility studies)

• Alan Skerman, (DEEDI QLD

• Stephan Heubeck (NIWA)

• Janine Price/Rob Wilson (APL, Pork CRC)

• Dr. Sasha Jenkins, UWA

• Mark Hogan/Ian Longfield, Rivalea

• Grant Skilton, Aurere Farms

• Hugh Payne, DAFWA, Medina

• Steve Lepper, NZ

• Abre de Villiers

Administration: working with the Clean Energy Regulator

Understand three key administrative steps involved with Carbon Farming Initiative projects.

Three important parts to your administration

1. Recognised Offsets Entity

2. Eligible Offsets Project

3. Certificate of Entitlement

Download application forms from the Clean Energy Regulator website. There are no application fees.


Recognised Offsets Entity

• Essential to be part of the Carbon Farming Initiative and issued with Australian carbon credit units

• Open an ANREU Account » fit and proper person test » proof of identity test

• Centrally processed, case officer allocated

Tip: call us before you submit your application to make sure it’s all in order: (02) 6159 3434

Eligible Offsets Project

• Sets out your plan to implement a Carbon Farming Project.

• Checked by the Clean Energy Regulator to make sure your plans meet the Carbon Farming Initiative rules.

• Processed by Carbon Farming team, new case officer.

Eligible Offsets Project: Q10 Project start date

If backdating, confirm project operating with project requirements the whole time period

Eligible Offsets Projects: Q12 Project description

• Address all project eligibility points identified in s2.1 of the methodology determination

Eligible Offsets Projects: Q25 Legal right

• Land title

• Licence

• Contracts

Certificate of Entitlement and offsets report

• Applications for Australian carbon credit units are made at the same time as you submit your offsets and audit reports.


• You can choose when to report and apply for credits, within the one to five year period.

• Good record keeping is essential to your report and audit.

Summary: three important parts to your administration

1. Recognised Offsets Entity 2. Eligible Offsets Project 3. Certificate of Entitlement

Carbon Markets and feasibility

Purpose:

• Understand the basics of ACCU markets to enable you to ask questions of your advisors

• Provide you with tips to consider when undertaking your feasibility

Types of markets

• ACCUs are personal property and can be traded.

• Two key markets: » Domestic compliance market » Voluntary market

Characteristic Kyoto ACCUs Kyoto project

Non-Kyoto (eligible) Kyoto Project

Non-Kyoto (voluntary) Non-Kyoto project

Can be surrendered under the carbon pricing mechanism

Yes Yes No

Able to be sold on the voluntary market

Yes Yes Yes

Able to be converted or exchanged for international emissions units

Yes No No


Selling ACCUs

• Compliance market - pay attention to: » Carbon pricing mechanism in fixed price period (to 2015) » Market for European Union Allowances (after 2015)

• Voluntary market – pay attention to: » Charisma of your project

Who can help?

• Seek advice from an Australian Financial Services Licence holder

• Consider these resources: » Your normal bank and/or broker » Carbon Markets Institute:

CFI hub » Liable Entities Public Information Database (LEPID)

Project feasibility

1. Financial feasibility

• Know the costs and benefits

• Cash flow

• Scenario analysis 2. Commercial feasibility

• Kyoto or Non-Kyoto ACCUs?

• Number ACCUs estimated?

• Timeline to deliver ACCUs?

3. Methodology

• Can you meet the rules for eligibility and data capture as described in an approved methodology determination?

4. Regulatory Feasibility

• Methodology available?

• In Australia?


• Required by law?

• Legal right?

5. Legal feasibility

• Pass tests to open ANREU account?

• Legal right to carry out project?

6. Organisational capabilities

• Own and operate?

• Engage third parties? (aggregator, broker, cooperative)

Question and Answer panel • Case study

• Administration: three key steps when working with the Clean Energy Regulator

• Carbon market and project feasibility

Thank you

Evaluation forms

More Information

• Clean Energy Regulator website5

• Phone: 1300 553 542

• Email: [email protected]

• Watch the webinar or view the transcript6

5 http://www.cleanenergyregulator.gov.au/Pages/default.aspx 6 http://www.cleanenergyregulator.gov.au/Carbon-Farming-Initiative/events/Pages/webinar-piggeries.aspx

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