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Waste Not, Want Not - How Anaerobic Digestion Can Lower

Input Costs
Although the cost of an anaerobic digestion plant is high, by using your farm waste to generate heat,
electricity and biofertiliser, youll save money in the medium to long term and open up new income
streams.

Turning muck into brass

Imagine if you could take your slurry and turn it into something valuable Imagine if you could use it to generate
electricity that you could use on the farm and sell into the national grid ... Imagine if you could also capture the heat
produced and put it to use in farm buildings...
More and more farmers are using anaerobic digestion to turn their farm wastes into energy, cutting their own
energy costs and attracting additional subsidies. Some are even selling the electricity to the national grid and
see the investment as more secure and profitable than expanding their herds.
And if thats not enough, anaerobic digestion also creates a nutrient-rich biofertiliser which studies show works
better than chemical-based ones alone.

What is anaerobic digestion?

Anaerobic digestion is the controlled breakdown of organic matter in a closed digester vessel. The air supply is
restricted to stimulate anaerobic decomposition (unlike composting, which takes place in the presence of air).

This process of decomposition, accelerated in the presence of bacteria, produces a methane-rich biogas, which
can then be turned into heat and electricity through cogeneration also known as Combined Heat and Power
(CHP).
In its simplest form the process is:
biomass + bacteria = biogas + biofertiliser
Check out this illustration to see how it works on-farm.
It isnt a new idea. In 1895, street lamps in Exeter were powered using the same process. And the method has
been used on farms for a number of years. The difference now is that technological advancement, financial
incentives and years of rising input costs on-farm have made it commercially attractive on a small scale.

What does it mean for my business?

Input costs have recently fallen slightly, but are still high. There has been a decrease in fertiliser, seed and fuel
costs however the cost of oil wont always be this low (which means that energy and fertiliser costs will only go
one way in the medium to long term). Moreover, the small dip in input costs has been dwarfed by the huge falls in
commodity farmgate prices in the past year.
While you cant control the commodity or energy markets, you can control your energy input costs if you
generate it yourself. By using on-farm anaerobic digestion, you can not only produce biogas to lower your fuel bills,
you can potentially offset other costs by selling energy back into the grid. You can also lower both your fertiliser
and your waste removal costs...

Isnt the cost of an anaerobic digestion plant high?

True, anaerobic digestion requires substantial up-front capital. However, the cost of an anaerobic digestion
plant might not always be as high as the figures you have seen. For example, if you already have good access
and good slurry storage and handling facilities, this can significantly lower the overall investment.
Whats more, there are a number of funding streams available. The banks are becoming more receptive towards
anaerobic digestion as a stable farm diversification option. There are also loans available through the
governments On-Farm Anaerobic Digestion Loan Fund.
There are even grants available to help cover the cost of investigating the economic and environmental benefits of
anaerobic digestion for your farm.

Double subsidies
If you generate renewable energy on your farm, youll also attract not one but two subsidy streams.
The first subsidy is called the Feed-in Tariff and is paid for every kWh of electricity generated through anaerobic
digestion. The electricity can also be sold to the grid, generating even more income.
If Combined Heat and Power is used to turn the biogas into energy, the heat is also captured. This is often used to
maintain the temperature of the digesters on the plant, but in the right circumstances it can be used to heat water
and buildings. In this case theres an additional subsidy per kWh through the non-domestic Renewable Heat
Incentive.
Support from both of these subsidies is index-linked and guaranteed for a 20-year period.

Now Im interested.
And so now youll want to know what the return on investment is. It depends on the plant, the feedstock, the
efficiency of the CHP and the subsidies. There are a number of factors, but the return on investment can be
around five to seven years. Ask a good energy consultant for essential expert advice on the potential cost of an
anaerobic digestion plant at your farm. They will scope your project, conduct a feasibility study, handle any
necessary planning applications and ultimately implement your project successfully.

Takeaways:
A small dip in farm input costs has been dwarfed by huge falls in commodity farmgate prices in the past
year.
On-farm anaerobic digestion can cut your energy and fertiliser costs and provide additional income
streams.
Significant ROI can be achieved from an on-farm anaerobic digestion plant within five to seven years,
future-proofing your business.
An energy consultant is essential to give you expert advice and avoid costly pitfalls.