Village of Turtle LakeCollaborative Digester – Biogas to Energy

Feasibility Study Phase 1 Findings

Presented to Village BoardApril 20, 2009

Introductions

Paul Gont, PE, Wastewater Engineer

Sheryl Claflin, PE, Civil Engineer

David Carlson, CEDP, Economic Development

Mark Broses, PE, Environmental Engineer

Dan Hedrington, Agricultural Services

Short Elliott Hendrickson, Inc.

Outline• General Drivers for this Project

• Short Answer & Recommendation

• History of the Turtle Lake Project

• Overview of the Feasibility Study

• Preliminary Results

• General Considerations for Biogas to Energy projects

General Drivers for Collaborative Digester Biogas Project

• Collaborative digesters focus on combining the organic waste streams from multiple operations (cheese factories, dairy farms, and egg layers, for example) into a central digester system (s)

• Waste Treatment

• Biogas Renewable Energy Opportunity

• Financing Options for Public / Private Systems

Federal Legislative Actions related to Biogas to Energy

• Energy Independence & Security Act ( 2007 )• Food and Energy Security Act of 2008 ( Farm Bill ) • American Recovery and Reinvestment Act Economic

Stimulus Act (2009) • Production and Incentive Tax Credits, ( electricity derived

from biomass extended to 2013 )

In the not too distant future …..• New Energy Bill? Renewable Feed-In-Tariffs?• Biogas tax credits $4/MMBTU expected to pass• Bitter debate over Carbon Cap & Trade - When, If, How?• Increased emphasis on cogeneration

Why is a Digester Needed?

• The Turtle Lake WWTP is having difficulty meeting limits due to the industrial waste loads and slug discharges currently going to the treatment plant.

• The local industries are having difficulty meeting their DNR requirements to handle their high-strength waste (land application)

• Expansion

A collaborative digester would address both the industrial and the Village current DNR regulation issues.

The Short Answer

• The Base Case – Simple* Payback is at approx 10 yrs. (assumes $8/MMBTU gas, 20% grant funding available, $2 carbon credit value, and $4/MMBTU Biogas Tax Credit)

• Optimistic - Simple* Payback < 7 years (assumes $10/MMBTU gas, 30% grant funding available, $10 carbon credit value, and $4/MMBTU Biogas Tax Credit)

• But - Pessimistic Case shows Simple* Payback at approx 40 years. (assumes $6/MMBTU gas, 0% grant funding available, $1 carbon credit value, and NO Biogas Tax Credit)

*Simple Payback does not include Debt Service as base case assumes very low interest loans will be available

Potential Funding Options

• Grants and Low Interest Loans• Clean Renewable Energy Bonds

• Tax Credits (RE, Biogas)• Carbon Credits?

Implications of• Public Financing• Private Financing

• Integrated Public/Private Approach

Ownership and Administration Issues

• Tax code – tax credits

• Control of Project

• Operation and maintenance labor

• Renewable energy credits, carbon credits

• Long-term agreements

• Code (municipal utility)

• Financing (ownership structure)

Recommendation

Move forward with Phase 2, with initial focus on business planning component to

• evaluate financing methods

• secure long term partners

Work on engineering component of Phase 2 in parallel with business planning

History of the Project

• Initial studies conducted by Lake Country Dairy began in 2006

• Evaluated both single plant stream as well as additional waste streams from Kerry Foods and Northern Liquid Waste Management

• Ecovation Anaerobic Digester Mobilized Film Technology (MFT)

• Combined Heat and Power

• Project stalled due to short term finance issues

Current Study

The Village offered to take the lead on Public / Private approach

A Focus on Energy grant was securedto complete a Preliminary Feasibility study

to determine if a digester would be a feasible solution for the situation.

Core participants agreed to pay for a portion of the matching funds to complete

the study.

Is providing $10,000 grant toward Phase 1

Focus on Energy works with eligible Wisconsin residents and businesses to install cost effective energy efficiency and renewable energy projects.

Focus information, resources and financial incentives help to implement projects that otherwise would not be completed, or to complete projects

sooner than scheduled. Its efforts help Wisconsin residents and businesses manage rising energy costs, promote in-state economic

development, protect our environment and control the state's growing demand for electricity and natural gas.

http://www.focusonenergy.com/

Core (Paying) Participants for Phase 1

• Lake Country Dairy

• Kerry Foods

• Northern Liquid Waste Management

• Village of Turtle Lake

• Focus on Energy

Other Study Participants• Barron and Polk Counties

• UW Extension

• Turtle Lake School

• Other interested food industries and

• Large dairy farms – concentrated animal feed operations (CAFOS)

Lake Country DairyStudy Participant

Lake Country Dairy

• Lake Country Dairy started as a milk transfer station with 12 employees

• LC currently makes 70,000 lbs of cheese per day

• LC utilizes 800,000 lbs of milk per day• LC during the winter peak this year had 200

employees• LC land spread 11 million gallons of waste

per year• LC is hoping to double it’s size depending

on the economy.

Kerry Foods

Kerry Foods• Separates soy flour and removed protein for human

consumption• Kerry sells the protein to international companies

such as Nestle and Kellogg• By-product of their process is soy fiber and soy

whey• Kerry land spreads 30 million gallons of waste per

year• In 2008 Kerry produced 7 million lbs of product• Kerry is estimating 10 million lbs of production in

2009• Kerry would like to double it’s capacity depending

on the market

Northern Liquid Waste Management

Manages (including collection and land application) of liquid wastes from several local food industries including cheese factories and dairies

Village of Turtle Lake

Village of Turtle Lake

• Continue to Serve existing Industrial and Residential Clients

• Support Expansion

• Attract New Businesses to Eco Industrial Park

Turtle Lake Wastewater Treatment Plant• WWTP Built in 2003

• Design flow of 546,000 gal/day

• Current flow to the WWTP is 514,000 gal/day

• Design BOD is 2,464 lbs/day

• As of March 2009, BOD loading was 2,958 lbs/day

• Suspended solid design is 2,407 lbs/day

• Current suspended solids is at 1,762 lbs/day

Overview of the Feasibility Study

• looking at waste from farms, industrial food processing businesses and municipalities within an approximate 100 mile radius, and then processing that material at a single or multiple locations to produce biogas and solids that can be utilized for a variety of purposes.

• The goal of this facility is produce enough biogas that if used for electrical generation, could produce up to 4 MW of energy.

Collaborative Anaerobic Digester Concept for Biogas Production

Scope of the Study

Phase 1

Phase 2

Site Considerations• Aesthetics – odor, noise and visual

• Traffic (proximity to residence)

• Proximity to waste source (industries and agriculture producers)

• Proximity to by-product users

• Discharge of effluent

• Land availability

• Proximity to Eco-Industrial park

• Proximity to transmission infrastructure

• Proximity to source utilities (sewer, water electric, natural gas)

Options No. 1 and 2Processing manure waste and the industrial

waste in separate digesters at same site.

Option 1 –New Industrial Park (adjacent to Lake Country)

Option 2 –near the existing Public Wastewater Treatment Plant

Options 1 and 2 – two systems at one site (new Industrial Park near LC, or near the WWTP)

MFT DigesterMFT Digester

Biogas use processBiogas use process

Biogas CleanupBiogas Cleanup

High solids, fats& grease digesterHigh solids, fats& grease digester

Biogas CleanupBiogas Cleanup

Solids

Manure

Others

FiberHigh Soluble

Options No. 3 and 4Processing manure waste and the industrial

waste in separate digesters.

Option 3 – The industrial digester would be on LC site and the manure digester would be

located near the existing WWTP

Option 4 – The industrial digester would be on the Brownfield site (near Kerry Foods) and the

manure digester would be located near the existing WWTP

Options 3 and 4 – two systems, two sites

MFT Digester@ LC or KF

MFT Digester@ LC or KF

Biogas use processBiogas use process

High solids, fats& grease digester

@ site near WWTP

High solids, fats& grease digester

@ site near WWTP

Biogas CleanupBiogas CleanupBiogas CleanupBiogas Cleanup

Solids

Manure

Others

FiberHigh Soluble

Options No. 5 and 6Processing manure waste and the industrial

together in one digester.

Option 5 – near the Wastewater Treatment Plant

Option 6 – at the Industrial Park (near Lake Country)

Options 5 and 6 – Combined waste streamsat one site, WWTP or New Industrial Park

Combined flowDigester

Combined flowDigester

Biogas use processBiogas use process

Biogas CleanupBiogas Cleanup

Manure

Others

Fiber

High Soluble

Capital Costs

Annual Costs

Annual Revenue

Simple Payback

Biogas Use Alternative

• Direct use in plant boilers• Convert to electricity for power and heat

• Clean gas to vehicle quality• Clean gas to natural gas pipeline quality

Note: assume conversion to electricity and heat for the cost estimates due to the cost versus payback ratio. Other alternatives are dependant on project location and by-product users. The final use determination will be completed in Phase II.

Criteria for evaluating Biogas use• Technology maturity

• Cost– Capital– operations and maintenance

• Carbon Credits

• Regulatory permits

• Incentives– Grants– Funding sources

• Job creation

• Revenue generation from gas and by-products

Combined Heat and Power

http://www.ge-energy.com/prod_serv/products/recip_engines/en/downloads/as_biogas_feb08.pdf

Cleaning up Landfill Bio Gas to CNG for Vehicle Fueling in Ohio

http://www.firmgreen.com/tech_main.htm

Residual Solids from Digester Use

• Fertilizer

• Land application

• Bedding

• Other Alternatives

Considerations

• Logistical

• Administrative

• In-plant

Logistical Issues

• Feedstock Delivery (& rejection)

• Storage (inputs and outputs)

• Odor, Noise, & Visual Aesthetics

• Truck Traffic Planning

• Health & Safety

Administrative Issues

• Long term agreements

• Bio Fuel price variation may not be related to fossil fuel pricing

• Air permits (for variable fuels)

• Warranties (for fuel types)

• Public/private partnerships

• Power Purchase Agreements

• Carbon Credits

In the Plant

• Fuel quality specifications

• Toxicity and shocking to bacteria

• Handling (sizing, fines, rocks, corrosiveness, stability, etc)

• Gas cleanup (H2S, siloxanes,…)

• Emissions

• Reliability (for example - anaerobic digestion to biogas can be a tricky business)

• Redundancy and Replacement

Questions?

Thank you.