George DeRuyter and Sons Dairy

George DeRuyter and Sons Dairy is an anaerobic digester project in the state of Washington. The project benefits climate change strategies by reducing the amount of greenhouse gases produced in dairy operations, and by reducing the green house gases from the public electricity grid. The farm substitutes fossil fuel-based electricity with clean renewable electricity and substitutes fossil fuel based heating with waste heat from the electricity generators.

Prior to the project, the manure at this 5,500-cow facility was stored in open lagoons and applied to fields as fertilizer seasonally. In open lagoons manure decomposes anaerobically and results in large amounts of methane emissions. Methane is a harmful greenhouse gas. The sale of carbon offsets helped make a digester system financially feasible, and now manure is instead fed into a digester where the methane is captured and used for energy production.

The project first came online on in November, 2006.

TerraPass funds help ensure an adequate financial return for the project, consistent with the farm management team’s assumptions about carbon offset revenue as part of the project’s financing package.

Project details

The George DeRuyter and Sons Dairy is a large dairy operated in one of the most active dairying counties in the United States. The project is well managed, and in addition to operating a digester, also sells a mix of innovative agricultural products, such as Enviromoss, a branded garden product made from digestate.

The dairy is home to approximately 4,500 cows and 1,000 heifers housed in two farm complexes. The larger of the two holds 3,000 head in freestall barns and has double 40 parallel milkers. The smaller complex holds 1,200 head and milks in double 20 herringbone milkers. Manure is managed with a flush system, having been previously stored in open lagoons where it decomposed anaerobically to produce methane gas. In 2001 the farm was the site of a trial project of the Pacific Northwest National Lab involving a mixed aerobic/anaerobic treatment system for animal waste call the InStreem. This project does not seem to have moved to a larger scale.

The anaerobic digester project is a two-stage mixed-plug flow system. It has a planned hydraulic retention time of approximately 21 days and is operated at mesophilic temperatures.

The project is generating electricity and has a nameplate capacity of 1.2 megawatts through two gas turbine engines, as well as a backup flare.

Project location

The project is located in Outlook, WA, southeast of Seattle.

Other social and environmental benefits and costs

Environmental benefits

• Improvement in air quality (e.g., VOC reductions).
• Elimination of odor in surrounding areas, improving living standards both on the farm and in the neighboring communities.
• Digester output serves as organic, largely pathogen-free nutrients for use as fertilizer. The farm also markets this output as an organic garden additive.

Social benefits

• Local employment for construction related to the project, installation of equipment, and operation of the project.
• Increasing energy independence for the farming sector. This manifests itself both in lower long-term energy costs (extending beyond the crediting period) as well as reduced exposure to price risk in energy markets.
• Continued operation of a dairy farm that brings economic benefit to the local community.

Project’s ability to foster further greenhouse gas emission reductions

• This project is the second digester is the state of Washington and will help encourage further uptake of the technology in the state.
• The project can be expanded to help manage additional manure.

Project’s environmental and social costs

• The project required construction of a new digester, along with associated consumption of energy-intensive goods such as concrete and steel.
• The project’s engine emits small amounts of air emissions typical for a backup gas generator.

Discussion of appropriate use of TerraPass funds

The project is an ideal candidate for TerraPass funds, as carbon revenues clearly were a decisive factor in helping a project that significantly and permanently reduces greenhouse gas emissions while achieving a modest financial return.

TerraPass considers many aspects of projects before deciding whether to fund them. Here is a summary of key considerations for this project.

Baseline conditions

Before the installation of a digester, the farm stored its manure in open lagoons and applied it to fields as fertilizer seasonally.

Additionality

No regulatory requirements. There are no state, federal, or local regulations requiring the diary to manage
its manure in this manner.

U.S.-based anaerobic digester based projects are widely accepted as additional by analysis of their aggregate economics and adoption profiles. This project meets the eligibility criteria of all the following performance standard protocols: EPA Climate Leaders, Climate Action Reserve, and CCX Offset Protocol. The project has been verified against the standards of the CCX Offset Protocol. At the time of project launch there were approximately 100 dairy digesters in operation in the USA, out of a total of about 92,000 dairies.¹

Barriers to implementation. As one of approximately 100 digesters in the United States, this project faced early market and technology barriers. Other alternatives open to the facility, such as continuing open lagoons, did not face these barriers. We do not know of any reasons that continuing operations would face any legal or permit barriers.

Impact of TerraPass funds. A review of the project’s finances prior to operation showed clear expected carbon offset revenues at the time of launch, and the magnitude of carbon offset revenues significantly contributes to making the project economically feasible to the farm owners compared with other investment alternatives.

Better than most. TerraPass seeks projects where the operations have shown good practices and avoided substantial negative impacts. George DeRuyter and Sons Dairy is a well-run dairy with good community relations and an innovative approach to environmental management.

1. Climate Leaders Draft Offset Protocol, October 2006.