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    Centralized Anaerobic Digestion (AD)

    Diversion Potential:
    1,884K Tons

    Economic Value Per Ton:
    $21

    GHGs Reduced:
    1,179K Tons

    Jobs Created:
    1,933 Jobs

    Definition

    A series of biological processes in which microorganisms break down biodegradable material in the absence of oxygen resulting in two end products: biogas and digestate. There are many different AD technologies, including wet and dry versions, the latter being generally better suited for food waste mixed with yard waste.

    Overview

    More than 2,000 sites in the U.S. utilize ADs, primarily in agricultural, wastewater, and urban settings, but only 40 to 50 are dedicated to processing food scraps today. The primary physical byproduct of AD is a digestate. The liquid fraction of digestate can be applied to fields seasonally as a biofertilizer, and the solid fraction can be composted. Biogas, the primary economic byproduct, consists of roughly 60% methane and can be: • minimally treated and used to generate heat on-site, offsetting natural gas, • treated to remove contaminants and fed into a natural gas pipeline, • treated and converted to compressed natural gas (CNG) as a renewable vehicle fuel, or • converted to electricity and heat with a combined heat and power (CHP) system. Capital costs for a larger AD facility (50,000 tons per year) are expected to be over $20 million. Similar to Centralized Composting, the combination of high disposal fees, high compost values, and high electricity prices make the Northeast the most favorable area for Centralized AD economically. The Northwest has very cheap electricity, but if the gas is used to power vehicles rather than create electricity, it can be profitable. Areas like Las Vegas and Tampa, Fla., show profit potential, but low disposal fees and high collection costs make it unlikely that projects will be developed without additional policy support.

    Challenges

    • The cost of capital is both critical to project economics and correlated to uncertainty in the supply of feedstock for the life of the project. AD facilities often need to secure a complex set of contracts with multiple points of waste generation. Large anchor generators are preferred but are hesitant and unlikely to sign long-term contracts since renegotiating contracts on a regular basis can lower costs for the generator.
    • A survey of producers in California identified the negotiation of power purchase agreements with local utilities as the most difficult challenge for AD.

    Stakeholder Actions

    • Policymakers can offer broader recognition of the ability for biogas to contribute to renewable energy portfolios. The Department of Energy is helping facilitate this transition with its recent expansion of the definition of "biomass" to include "wet waste", including food waste, for renewable fuel standards.
    • Further development of AD in agricultural settings is needed. A very small proportion of U.S. dairy farms — about 250 out of 51,000 — are currently digesting manure. The USDA estimates the market for AD installations could approach 11,000 farms nationally.
    • Leasing models could allow for a third-party owner or operator to manage regional sets of medium-size digesters.
    • More consistent markets for digestate products would boost the stability of AD projects. One step is to develop organics certification for digestate-derived fertilizer through channels like the National Organics Program (NOP) in order to be recognized as organic by the USDA.
    • Impact investors can offer lower-cost sources of financing to enable projects that are unable to complete their financing today.

    Related Solutions

    Top Rated Solution:
    Largest Waste Diverted
    Greatest GHG Reduction
    Most Jobs Created

    Centralized Composting

    Composting is the process of transforming organic waste into humus, a critical component of healthy, fertile soil. In rural areas, this can be accomplished by periodically turning large piles, or windrows, of organic waste over themselves using specialized equipment. In more urban areas, Aerated Static Pile (ASP) composting is generally preferred, where piles can be covered and mechanically aerated in order to minimize the site’s footprint and odors.

    $4 /ton
    in financial benefit

    5,037 K tons/yr
    in diversion potential

    0 M meals/yr
    meals recovered

    2,605 K tons/yr
    in GHG reduction

    0 B gal/yr
    in water conservation

    9,000
    jobs created

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