Growing Our Energy Agricultural Waste-to-Energy

Renewable Energy Generation and GHG Emission Reductions via

Innovative Waste Management

Presented To:

ACEC Environmental Committee

February 10, 2014

Presented By:

William G. “Gus” Simmons, Jr., P.E.

Cavanaugh & Associates, P.A.

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Why Are We Looking at Alternative Energy / Fuels???

• With less than 5% of the world’s population, the United States consumes 25% of the world’s oil supply.

• The U.S. has just 1.6% of the world’s oil reserves.

• We currently export 1.1 billion gallons of U.S.-produced ethanol annually (Europe, UAE, etc.)

• There are problems…

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A Quick Look at the Data…

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Where Does our Electricity Come From? (US)

The Great Imbalance of “Power”

A Global Supply Problem…

Alberta Tar Sand Pit

- This area used to be forested, full of trees and wildlife - 54,000 square miles in size – A little bigger than entire NC! - 4 Gallons of Water used for every 1 gallon of Oil Produced!!!

Why is NC Looking at Alternative Energy / Fuels from Ag Waste???

• NC Ranks 2nd in the US in pigs produced, with 15% of the US pig crop (IA)

• NC Ranks 2nd in the US in turkeys produced, with 13% of the US turkey crop (MN)

• NC Ranks 4th in the US in broilers produced, with 9% of the US broiler crop (GA)

• NC Ranks 10th in the US in residential electricity consumption, per capita

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Agricultural WTE Reqmnts in NC • With the passage of Senate Bill 3 (2007), North Carolina

became the first state in the Southeast to adopt a Renewable Energy and Energy Efficiency Portfolio Standard (REPS).

• SB3 requires: – investor-owned utilities in North Carolina to provide up to 12.5% of

their energy through renewable energy resources or energy efficiency measures.

– Rural electric cooperatives and municipal electric suppliers are subject to a 10% REPS requirement.

• Agree or Disagree – a linkage was made between the potential for the development of renewable energy (biogas / biomass) and all the pig farms in North Carolina

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North Carolina Potential

Data provided by Duke University Carbon Offsets Initiative 9

Asheville

Triad Raleigh/RTP

Charlotte Wilmington

Renewable Statutes Nationwide

State renewable portfolio standard

State renewable portfolio goal

Solar water heating eligible * Extra credit for solar renewables

Includes non-renewable alternative resources

WA: 15% x 2020*

CA: 33% x 2020

NV: 25% x 2025*

AZ: 15% x 2025

NM: 20% x 2020

HI: 40% x 2030

Minimum solar or customer-sited requirement

TX: 5,880 MW x 2015

UT: 20% by 2025*

CO: 30% by 2020

MT: 15% x 2015

ND: 10% x 2015

SD: 10% x 2015

IA: 105 MW

MN: 25% x 2025

MO: 15% x 2021

WI: Varies by utility; 10% x 2015 statewide

MI: 10% + 1,100 MW x 2015*

OH: 25% x 2025†

ME: 30% x 2000 New RE: 10% x 2017

NH: 23.8% x 2025

MA: 22.1% x 2020 New RE:

15% x 2020 (+1% annually thereafter)

RI: 16% x 2020

CT: 23% x 2020

NY: 29% x 2015

NJ: 22.5% x 2021

PA: ~18% x 2021†

MD: 20% x 2022

DE: 20% x 2020*

DC: 20% x 2020

VA: 15% x 2025*

NC: 12.5% x 2021

VT: (1) RE meets any increase in retail sales x 2012;

(2) 20% RE & CHP x 2017

KS: 20% x 2020

OR: 25% x 2025

IL: 25% x 2025 WV: 25% x 2025*†

DC OK: 15% x 2015

29 states (+ DC) have a Renewable Portfolio Standard; 7 have goals

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NC IOU* Renewable Obligation**

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* Investor Owned Utility ** Under Senate Bill 3

Year Total REPS Solar Swine Waste

Poultry Waste

2010 0.02%

2012 3% 0.07% 0.07% 170k MWh

2013 700k MWh

2014 900k MWh

2015 6% 0.14% 0.14%

2018 10% 0.20% 0.20%

2021 12.5%

Out of State REC Cap = 25% of Requirement

To meet obligations of SB3, Duke Energy would need ~123,000 MWh of Swine Waste Fueled Electricity Needed by 2018

The North Carolina Potential - What Can We Expect from Swine

Waste to Energy Systems? • About 1.1 M MWh electricity annually

• About 6.3 M tons GHGs reduced annually

• Potential for major nutrient management strides and pathogen reductions

• Improved animal health, reduced mortalities, greater farm productivity

• Creation of new acres of cash cropland Data provided by Duke University Carbon Offsets Initiative

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How to turn pig waste into electrons?

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Step 1: Model Development Project Goals: (2006)

• Make it “Market Feasible” – farm owners perspective

• Energy Generation + Water Quality Improvement + Air Emissions Improvement

• Make it flexible - different farm sizes & types

• Process based, not technology based

• Innovative waste management : Achieve environmental performance standards as described by NC legislation – Substantial elimination of odor, ammonia, total nitrogen,

and pathogens

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BioEnergy Digesters in United States

BioEnergy Digesters in North Carolina

Commercial-Scale Project : Case Study: Digester Systems for Animal Waste Solids – Loyd Ray Farms Project GHG Emission

Reductions and Renewable Energy Generation via Innovative Waste Management

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Commercial-Scale Demonstration Project: Loyd Ray Farms Swine Waste-to-Energy Project Converts waste from 9,000 pigs into electricity Improved Environmental Management

How it Works:

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~65% CH4

Raw

Was

te

Mixed Digester

Bio

gas

Liq

uid

s

How it Works

Existing Storage Lagoon

Photos by: Marc Deshusses, Duke University, 2011

What it looks like… After Construction

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What it looks like… Steady State

Covered Anaerobic Digester

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Aeration System

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Gas Conditioning System & Microturbine

Microturbine Specifications: •65 kilowatt Generative Capacity •First Scheduled Service @ 8,000 Hrs •Only one moving part @ >90,000 RPM •Air bearings – no lubricant or coolant required

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Expected Outcomes: 5,000± Carbon Offsets per Year, registered with Climate Action Reserve

Duke University & Google: Retire to meet carbon neutrality goal,

retire for immediate internal demand, and/or sell when strong

market signal arises

500± Renewable Energy Credits per Year

Utility: Motivated by NC Renewable Energy and Energy Efficiency

Portfolio Standard Swine Waste Set Aside

Electricity Generation

Farm: Energy to offset increased demand from innovative system

and offset baseline electricity demand (projected to offset up to

half of farm’s existing electricity demand)

Compliance with Environmental Performance Standards for New &

Expanded Swine Farms (ammonia, nutrients, pathogens, odors,

metals and zero discharge of waste to surface and groundwater);

Ensures compliance with offset standard to meet all air and water

quality standards by controlling nutrient loads

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Equivalent GHG Emissions: • Annual greenhouse gas emissions from 889 passenger vehicles

• CO2 emissions from 508,512 gallons of gasoline consumed

• CO2 emissions from 10,549 barrels of oil consumed

• CO2 emissions from 60 tanker trucks’ worth of gasoline

• CO2 emissions from the electricity use of 566 homes for one year

• CO2 emissions from the energy use of 393 homes for one year

• Carbon sequestered by 116,306 tree seedlings grown for 10 years

• Carbon sequestered annually by 967 acres of pine or fir forests

• Carbon sequestered annually by 45 acres of forest preserved from deforestation

• CO2 emissions from 188,997 propane cylinders used for home barbeques

• CO2 emissions from burning 25 railcars’ worth of coal

• Greenhouse gas emissions avoided by recycling 1,580 tons of waste instead of sending it to the landfill

Source: EPA Greenhouse Gas Equivalencies Calculator

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RESULTS

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Electricity Production Rate - 2011

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Condensate flooded compressor,

required rebuild

Controls system issues, supplier

‘tweaks’

Condensate pump issues

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Compressor cooler failure, controls

Manual Operation Only – Gas Skid Replacement

Scorecard

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Parameter Goal Actual Success Gauge

RECs 500 344 69%

Carbon Offsets 5,000 Tons 2,500 Tons 50%

Environmental Performance - Surface Water Protection

Substantial Elimination Accomplished by Permit

Passed

Environmental Performance - Ground Water Protection

Substantial Elimination Accomplished by Permit

Passed

Environmental Performance - Odor Emissions

>7:1 D/T 2:1 D/T Passed

Environmental Performance - Ammonia Emissions

WWTP = Farm =

106 kg/wk 476 kg/wk

23 kg/wk 341 kg/wk

460% (Passed) 140% (Passed)

Environmental Performance - Vector Reduction

<7,000 mpn/100mL <5,000 mpn/100mL

140% (Passed)

Costs and Benefits Costs

• Capital: $1.7M

• O&M: $80,000/year

Funding sources • NCACSP LCP • CCPI/EQIP • Farm Bill Section 9006 REEP • NRCS CIG & FPPC • USDA SBIR • USDA SARE • NSF • US Dept. of Energy • NC State Energy Office • Sale of RECs and Carbon Offsets

Benefits

• Cash flow for farm owner

• Improved animal health

• Other ecosystem services (N, P control)

• Variability in nitrogen output for fertilizer

• Reduced sludge management cost

• Improved air quality on-site

• Reduction of odors off site

• More choice in cropping plan

• Sustaining NC Agriculture

• Reduced GHG Emissions

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A couple of firsts… • First Swine Waste-to-energy project in the State

of North Carolina to place RECs on the North Carolina Utilities Commission REC Tracking System

• First Transfer of RECs from a NC Swine Farm to Duke Energy

• First ‘Innovative Swine Waste Treatment System’ permitted that utilizes digester

• First Swine Farm Expansion Permit Since 1997???

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Deployment? • Broad-scale deployment has been inhibited by:

– Costs: still requires “artificial economics” to make financial feasibility threshold

– Management: Requires ~240 farms to meet the goal, which means 240+ generators, etc.

– Risks: Many risks for many folks

• Policy, environmental, biosecurity, technology, etc.

– Access to Capital: $Millions and more required

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Overcoming Obstacles

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Overcoming Obstacles

• Research Team evaluated:

– On-farm Electricity Generation (like LRF)

– On-farm Digesters, Individual Directed Biogas

– On-farm Digesters, Centralized Biogas-to-Electricity

– On-farm Digesters, Centralized Directed Biogas

Report prepared and released by Nicholas Institute for Environmental Policy at Duke University, April 2013

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Next Steps • Continue to Overcome Obstacles

– Further Economic Analysis

• Refine / Validate Deployment Costs

• Refine / Validate Revenue Streams

• Monetize Non-Revenue Benefits for All Parties

– Expand Technology Reach

• New technologies / equipment every day in the expanding biogas/biomass markets

– Continue Research at LRF

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It took several hundred thousand years for the Earth

to make crude oil, but we can convert organic waste into natural gas (biogas) in

less than 2 days

Final Thought…