Revenue Streams
Anaerobic digestion systems can generate multiple revenue streams and reduce costs. Examples include:
Energy
- Electricity: Power sales under the current BC Hydro Standing Offer Program (SOP) will pay $74 - $89/MWh, depending upon location. BC Hydro is also in the process of increasing the SOP to $95 - $104/MWh, depending upon location. For more information on the SOP, please click here. The British Columbia Ministry of Energy and BC Hydro are also developing a Feed-In Tariff (FIT) for five renewable energy technologies. Anaerobic digestion is one of these technologies. While the price paid per MWh is yet to be determined, speculation is that it will be $140 – $180/MWh. For more information on the FIT, please click here.
- Heat: Heat may be used to offset building heating costs or sold to greenhouse or industrial complexes to displace natural gas. A potential thermal energy customer must be located close to the biogas plant as heat transportation is difficult.
Manure
- Bedding: Solid digestate can used as animal bedding, primarily in cattle and dairy industries. For example, a 200-head dairy may have bedding costs of $30,000/yr. This cost could be completely offset with the solid digestate.
- Spreading: Covered manure storage will decrease rainwater load in the manure pit, thus reducing hauling and spreading costs. For example, where winter precipitation is 1 meter, covered manure storage could reduce manure spreading costs by up to 30%.
- Fertilizer: Anaerobic digestion systems increases the crop nutrient value of manure. As such, less synthetic fertilizer is required. An accepted rule of thumb used in European is that the avoided fertilizer cost is $13/animal per year.
Fees
- Off-farm waste: Off-farm food waste is used in an anaerobic digestion system to increase biogas output and generate gate fees. Where disposal fees are $65/tonne at the landfill and up to $55/tonne at the rendering plant, anaerobic digestion systems could receive up to $50 – $60 /tonne for the off-farm waste they receive*.
- Environmental attributes: These are the positive environmental difference between the current manure management system and the anaerobic digestion system. Examples include greenhouse gas reductions, odour reductions and pathogen reductions. Currently, due to the small volume created by a single anaerobic digestion system in BC, individual system owners are unable to sell their environmental attributes as the cost is greater than the revenue received. However, the BC Agricultural Research and Development Corporation is now working on a program to enable farmers to sell their environmental attributes for $0.03/kWh. Watch this space.
* Securing a long term contract can be difficult and the supply of waste must be constant and consistent throughout the year.
