Pagel’s Ponderosa Dairy Biogas Utilization Project

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The Pagels Ponderosa Dairy Biogas Utilization Project is located in Kewaunee, WI, near Lake Michigan and approximately 25 miles west of Green Bay. Pagels Ponderosa Dairy is a large family owned and operated dairy farm. The Project will reduce the amount of greenhouse gases that are emitted to the atmosphere from the dairy operations, and also provides a source of renewable energy.

The Project consists of an anaerobic digester that converts manure from the dairies working cows into biogas, along with several means of biogas utilization and destruction. Before the construction of the digester, manure from the farms dairy cows had been treated in open lagoons which produced and released methane (a gas with global warming effects 21 times more potent than CO2) to the atmosphere. The digester captures the methane, which is then used to generate electricity and heat.

An on-site generator was installed in early 2009 and can generate up to 800 kW of electricity. A biogas fuelled boiler is also used to generate heat for the dairy and the barns, reducing the demand for other forms of energy. The Project also has a backup flare installed, which allows methane to be destroyed even if both the generator and boiler happen to be down for maintenance or repairs.

TerraPass funds help ensure an adequate financial return for the Project and satisfy the project developers expectation that the carbon market would support the project. TerraPass is the first company to purchase any credits from the facility.

TerraPass seeks to verify this project under the offset protocols of the Climate Action Reserve.

Project details

Pagels Ponderosa Dairy is a family-run farm that dates back to 1946, when Carl and Garnet Pagel started with 8 dairy cows. When John Pagel took over the farm in 1980 the farm had 65 cows, and in 1985, when a barn fire destroyed the dairy facility, the farm had grown to 100 cows. After rebuilding, the farm has continued to grow, and now contains 4,600 cows.

John Pagel has shown leadership in farm management practices, making sure that his business is successful and an environmental steward at the same time. It is important that we are not contributing pollutants to our rivers, streams, lakes or our groundwater said John, referring to the farms involvement with the University of Wisconsins Discovery Farms research project. The dairy was the first in the nation to direct-ship milk in 1996, and John received the Innovative Dairy Farmer of the Year award in 2003.

Project location

The Project is located in Kewaunee, Wisconsin, near Lake Michigan and approximately 25 miles east of Green Bay.

Other social and environmental benefits and costs

Environmental benefits

The Project provides the following environmental benefits in addition to minimizing greenhouse gases:

• Prevention of odor in surrounding areas.
• Improvement in air quality such as reductions in volatile organic carbon emissions.
• Renewable energy generation

Social benefits

• A local company based in Chilton, Wisconsin designed the system. Construction was undertaken by local contractors and created local jobs. The Project creates an ongoing operations and maintenance job function.

Project’s ability to foster further greenhouse gas emission reductions

• As part of its growth, Pagels Ponderosa Dairy has built a conference center overlooking its impressive 72-cow carousel-style milking parlor. This and other developments are part of an initiative to make the dairy a regional destination, with the goal that the Project and dairy will attract educational tours, other local dairy farmers and the general public. By introducing visitors to the Project, its successful operation may encourage others to implement similar projects.

Project’s environmental and social costs

• There are no major social costs associated with this Project.
• The Project required the construction of facilities and the associated consumption of energy-intensive goods such as concrete and steel. However, relative to the total emissions reductions created by the Project, these construction emissions are trivial.

Discussion of appropriate use of TerraPass funds

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 Project came online, all methane generated in the manure lagoons was vented directly to the atmosphere. With the Project in place, the methane generated will be collected and used to produce electricity and heat, minimizing the impact on the atmosphere.

Additionality

No regulatory requirements. The dairy is not required by any law to install a digester to treat its manure.

Barriers to implementation. While there were no regulatory barriers to implementing the Project, there are clear barriers to investment in this project. Dairy digesters are expensive to install and operate, and the prospect of carbon credit income reduces the financial risk of volatile energy prices.

Impact of TerraPass funds. TerraPass funds deliver a key component of Project funding that the Pagels expected to receive when they decided to undertake the Project.

Better than most. TerraPass seeks projects where the operations have shown good practices and avoided substantial negative impacts. Pagels Ponderosa Dairy has a strong track record of innovative management practices and environmental stewardship.