Down on the Farm: Farmers benefit from Wisconsin’s limitless potential for clean, renewable energy

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Down on the Farm

Farmers benefit from Wisconsin’s limitless potential for clean, renewable energy

Acknowledgements

The primary funding for this work was generously provided by the Energy Foundation.

Thank you to the farmers and producers who appear in this report and shared information and insight on their farms and Wisconsin’s potential for clean, renewable on-farm energy. Thank you to Crave Brothers for providing the cover photo featuring their digester.

Lead Author Katy Walter, Clean Energy Specialist Several Clean Wisconsin staffers assisted with this report. Special thanks to: Keith Reopelle, Senior Policy Director Amanda Wegner, Creative Director Tyson Cook, Staff Scientist Sarah Witman, Communications Intern

About Clean Wisconsin

Clean Wisconsin is an environmental advocacy organization that works to protect Wisconsin’s clean water and air and advocates for clean energy by being an effective voice in the state legislature and by holding elected officials and polluters accountable. Clean Wisconsin was founded in 1970 as Wisconsin’s Environmental Decade and is the state’s largest environmental advocacy organization.

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Rural Energy Report

Renewable Energy: Limitless Potential Renewable energy is clean, unlimited and offers enormous potential for rural Wisconsin. This report showpage 4 cases just a few examples of farmers who are taking advantage of the limitless resources provided by the wind, sun and farm waste.

INSIDE

Turning Waste into Energy Farmer Profiles Holsum Dairies Kenn Buelow

Digester, energy efficiency upgrades

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Quantum Dairy Richard Wagner Digester, energy efficiency upgrades

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Scenic View Organic Eggs/Ihm Organic View Farm John Ihm Solar array

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New Forest Farm Mark Shepard

Wind turbine, solar system, gasifer (under construction)

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Crave Brothers Digester, energy efficiency upgrades

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Moving Forward Resources for Farmers www.cleanwisconsin.org

Without a doubt, Wisconsin’s Focus on Energy program has helped make these success stories possible: each farmer we spoke with cited the program as being critical to the feasibility and affordability of their project. Focus on Energy is the statewide energy efficiency and renewable energy program that provides incentives for business and homeowners to make energy efficiency and renewable energy upgrades that save money on energy bills. Focus on Energy’s expertise and incentives have helped pave the way for each one of these projects.

When it comes to financing renewable energy projects, it’s no surprise that budgets on farms are tight and any expense must be justified. By producing their own energy on-site and coupling clean energy systems with energy efficiency upgrades, these farmers are cutting their electricity bills and bolstering their self-sufficiency. In some cases, renewable energy system and energyefficiency measures eliminate electricity bills altogether and create an extra income stream from the sale of excess electricity.

While each renewable energy system has to make sense for the farmer, expanding renewable energy in Wisconsin offers a myriad of benefits that extend beyond the farm. Every year, Wisconsin sends over $12 billion out of state to import fossil fuels. Giving Wisconsin’s farmers the tools they need to produce renewable energy will keep more money flowing in our economy by sending less money out of Wisconsin to import fossil fuels. In addition, Wisconsin is home to hundreds of businesses that manufacture, design and install renewable energy systems. In fact, there are 12,000 jobs connected to just the wind and solar industries alone. Investing in renewable energy promises to create thousands more jobs.

Despite the self-driven growth in on-farm renewable energy systems and the limitless benefits of that growth, page 10 there are steps that policymakers should take to help Wisconsin and its farmers take advantage of these repage 11 sources. This report ends with recommendations for moving renewable energy forward in Wisconsin.

Introduction | page

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Turning Waste into Energy Manure digesters (also known as anaerobic digesters) use bacteria to convert manure into water, solids and gas that can be used to produce electricity. While the ability to produce and sell electricity is often the first thing that comes to mind with this technology, farmers choose to invest in manure digesters for a number of reasons that are often overlooked by the public and policymakers. Thermal energy created from the digestion process offsets the need to heat buildings on the farm. After the digestion process, the waste is easier to handle and has significantly less odor. In addition, the solid byproduct can be sold as a fertilizer for gardeners. With so many benefits, it’s easy to see why this is a growing technology in the Dairy State.

Wisconsin leads the nation in on-farm digesters, but until very recently, all of the more than 30 digesters in Wisconsin were located on large dairy farms. This stands in contrast to the nature of Wisconsin’s agricultural industry, which is dominated by small- and medium-sized farms; closing this gap is an important next step for agricultural energy production in Wisconsin. Wisconsin is on its way, with the opening of a new small-scale digester at Wayne Peters’ farm near Chaseburg. (See “Digester Downsizing” at right.)

Digesters are especially rewarding for renewable energy and agriculture in Wisconsin given their ability to reduce phosphorus pollution entering our waterways.

Phosphorus is a nutrient responsible for dangerous, smelly algae blooms and is found in excess in many parts of Wisconsin. When used in combination with a nutrient management plan, digesters can help control this runoff pollution, as technology is available that removes most of the phosphorus during the digestion process. With places in Wisconsin and the nation in need of this nutrient, there is the potential for it to be captured and sold to phosphorus-deficient areas.

page 4 | Turning Waste into Energy

Digester Downsizing for the Future

Farmer Wayne Peters of Chaseburg, southeast of La Crosse in Vernon County, has initiated a project that could transform the landscape for Wisconsin’s small- and medium-sized farms.

In Wisconsin, the overwhelming majority of digesters are designed to serve herds of at least 800 to 1,000 cows. But in early 2012, Peters flipped the switch on a 30,000-gallon 45 kW manure digester that turns the waste of his small herd of just 210 into methane gas. That gas is then converted into electricity and fed into Vernon Electric Cooperative’s energy grid.

“I think in 20 to 50 years, every farm will have some form of a digester.”

The small size of Peters’ digester makes it a leader in a state already ahead of the curve in this technology sector. Pat Rezin, engineer and president of Tomah’s USEMCO, which built the digester, considers Peters’ digester a potential gamechanger.

"If this works well,” said Rezin in an interview with DairyStar, “the market for (manure digesters on) small farms will greatly improve.” In the same interview, he says “I think in 20 to 50 years, every farm will have some form of a digester.”

Source: http://dairystar.com

Rural Energy Report

Kenn Buelow’s farms are about

systems — cows, people, feed and energy. For Kenn, a veterinarian with advanced degrees in physics and math, this means taking a look at how everything fits together, tweaking things as changes come along, getting new ideas, and keeping records to make better and wiser decisions. This systems approach has led to a focus on energy efficiency and a remarkable achievement: Buelow’s operations use almost half as much energy per cow compared to traditional farms.

As one of the first dairies in Wisconsin to install a digester, Kenn learned that his operations could be profitable and installed a second one. While the digesters can produce two to three times the electricity Holsum Dairy needs, the benefits reach beyond energy: waste is easier to manage, the solid byproduct saves on bedding costs and is sold to other farmers and landscapers, and the system makes overall management of the dairies easier.

Holsum Dairies’ Energy Future

Kenn talks about the possibility of utilizing new technology that can remove 95% of the phosphorus from the manure to sell it at a higher value.

Holsum Dairies (includes two farms: Irish and Elm) Kenn Buelow

What Wisconsin needs to succeed

Hilbert

Built 2001-’02 and 2006-’07 On-farm energy 2,100 kW between both

farms

How energy is used Excess electricity

“Having the support industry – engineers, system designers and a devoted maintenance person – is really key. When local economies are developed to support this technology, we will see more jobs and lower costs for farms with digesters.”

www.cleanwisconsin.org

that isn’t used on the farm is sold to the utility at a fixed rate, providing the dairies with additional income. Excess heat from the digester is used to heat various buildings on the farm.

Farm Facts

In order for Wisconsin to grow on-farm energy sources, Kenn believes farmers need support systems in their local economies, a quick turnaround on maintenance and a better rate for electricity.

Cost benefits While the digesters can pro-

duce two to three times the electricity Holsum Dairy needs, the benefits reach beyond energy: it saves on bedding costs, manages nutrients better and makes overall management of the dairy easier.

Funding Focus on Energy incentives for the digester and energy efficiency upgrades

Holsum Dairies | page

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Upon retiring from his family’s 100-year-old cheesemaking business, Richard Wagner became a dairy farmer. In a township that is equally divided among farmland, forest and recreation, Wagner expanded the dairy to a 500-head operation to save the land from development pressure.

To make the expansion more palatable to neighbors, Wagner also installed an on-farm digester, which not only helped with odor control, but created a new revenue stream from bedding sales and, coupled with energy-efficiency measures partially funded by Focus on Energy, helped reduce on-farm electricity costs. Running the farm has been hard work, but Richard and his son-in-law Kurt Duxbury are “having a blast.” Richard looks at the farm as an investment in future generations and when the time comes, he will pass it on to the next generation in his family.

Quantum’s Energy Future

Quantum Dairy Richard Wagner

Farm Facts

Weyauwega

Built 2004/2005 On-farm energy 450 kW digester How energy is used Quantum Dairy sells

the electricity it doesn’t use. The excess heat is used to heat the dairy buildings and the water to clean the milk house.

Cost benefits After digestion, the waste is easier to spread on fields and the nutrients are easier for the crops to absorb and utilize. The farm saves money on bedding and receives income from the sale of electricity, carbon offsets, and bedding solids.

Funding Incentives for the energy efficiency

upgrades and the digester came from Focus on Energy. “Focus on Energy incentives and experts were critical to making the energy efficiency upgrades and digester installation possible,” says Wagner.

page 6 | Quantum Dairy

Richard would like to install a second digester and a solar array on the barn, but to do so he would need a strong rate for excess electricity. With an additional digester, it is possible that the farm could accept cheese waste, grease, and other materials that are currently going into landfills, creating more electricity and additional income for the farm. Wagner regularly receives calls from businesses that want to send their waste to Quantum’s digester.

What Wisconsin needs to succeed

Richard recognizes that while there are a number of factors that make Wisconsin the epicenter of digester installations at dairy farms, we are in danger of losing that distinction. A reliable buyback rate for excess electricity produced and increased incentives and financial assistance could help secure Wisconsin’s place as a leader.

“Manure digestion brings great synergies to the table for crops, the environment and a farm’s balance sheets. There is so much potential for growth and investment on dairy farms in Wisconsin.”

Rural Energy Report

Without the steady price of

organics, John Ihm never would have been able to afford to take over the family farm his father started in 1943. Limited by their small facility, Ihm’s Scenic View Farm became a certified organic farm in 2005, providing a stable price and steady income for his family. Interestingly, the farm had always been organic.

“We’ve been organic most all our lives, but just didn’t know it,” says John.

With the farms, John has 85 dairy cows and is a chicken farmer of Organic Valley. To boost stability and reduce costs, the Ihms installed a solar array on their chicken farm. The solar panels are a nice fit, since the chicken farm uses the most electricity in the summer when the solar panels are most productive, and a net-metering agreement with their power company ensures that their use and production evens out over the course of the year.

The solar panels offer an ancillary benefit as well: They were placed so the chickens can lounge in the shade the panels provide while on pasture.

Scenic View’s Energy Future

Scenic View Organic Eggs & Ihm Organic View Farm John Ihm

In the future, the Ihms would consider installing enough solar so they can cut their electricity bill in half.

What Wisconsin needs to succeed

Built 2012 On-farm energy 21.5 kW solar array How energy is used The electricity is

used to power the organic egg farm

Cost benefits The electricity that the solar panels produce has paid for itself.

Funding Grants from Focus on Energy,

“Everyone looks to be self-sustaining. Especially with electricity costs going up, in the long run, producing your own electricity will be incredibly beneficial.” www.cleanwisconsin.org

Farm Facts

According to John, the incentives from Focus on Energy were crucial to allow them to afford the up-front costs of installing the solar panels. “Any less financial help and it’s hard to justify. But with energy costs coming up, and solar prices come down, it will become more justifiable.”

Lancaster

USDA’s Rural Energy for American Program (REAP) and the U.S. Treasury Department

Scenic View Farm | page

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Putting an old concept into practice, Mark Shepard’s New Forest Farm models a return to nature without a return to the Stone Age.

Energy independence was a priority for this family farm at the very beginning, from the design of the buildings to the wind and solar power that provide all their electricity. Based on his background in mechanical engineering, Mark believes that 99% of homes or agricultural buildings can be designed to produce their own heat and power.

Mark views the wind turbine as an investment in the asset value of his property, with the fact that he doesn’t get an electric bill as an added benefit.

New Forest Farm Mark Shepard

Farm Facts

Viola

Energy self-sufficient since 1995 On-farm energy 10 kW wind turbine for the farm and 3 kW wind turbine and solar system for the house; solar thermal heating for processing center. Also produces biofuel for vehicles.

How energy is used To provide all the

power for the farm, home and vehicles

Cost benefits Mark produces enough elec-

Mark is quick to point out that the wind turbine on their farm is only one part of their energy story: their most innovative energy strategy is perennialism. With perennial crops like chestnuts, cherries, apples, hazelnuts, raspberries, grapes, mushrooms and livestock all layered on top of each other, they receive a significant financial benefit by never having to plant again. The farm’s unique strategy of layering different crops on top of one another is being studied by a number of universities, and results are showing that when you grow many different plants together, they produce more.

Wisconsin’s energy future The hazelnuts grown on New Forest Farm are a valuable commodity, but the shells of the nuts are available as well: Mark is in the process of building a gasifier to generate electricity from the remnants of the hazelnuts and other waste from their forest farm. One acre of trees can produce $90 worth of electricity that will be sold back to the grid.

New Forest’s energy future

Mark notes that Focus on Energy’s incentives for renewable energy were helpful and should be continued.

tricity that he doesn’t get an electric bill, but more importantly he looks at his wind turbine as a capitol investment in the asset value of his property.

Funding Focus on Energy renewable energy incentives

page 8 | New Forest Farm

“All farms can become energy producers.”

Rural Energy Report

Back in 1999, Crave brothers

George, Mark, Thomas and Charlie found themselves discussing the future of their business. That future was solidified over the next seven years as the brothers built a cheese factory in 2001 and added a manure digester in 2006.

“We wanted to use our own high-quality milk to produce specialty cheeses for the consumer,” says co-owner George Crave. “Within hours of milking the cows, the milk is piped directly to the cheese factory onsite.”

The decision to add a digester was a slow one, says George. The key, he adds, was striking a balance between the size of their operation and the size and cost of the technology. Crave Brothers worked with Milwaukee’s Clear Horizon Energy to build the digester.

In 2009, they upgraded from a 200 kW digester to one that produces 633 kW of power.

When asked if he considers Crave Brothers a leader in on-farm renewable energy, George defers.

Wisconsin’s energy future

Crave Brothers

Tom, Charles, George & Mark Crave Waterloo

Built 2007, upgraded in 2009 On-farm energy 633 kW digester

There is a sustainable energy movement in the United States, says George, with more farmers becoming dependent on renewable energy. And not just biodigesters, but solar and wind as well. “[Digesters are] just one of the different technologies that are going to be available for future production of green energy, where we’ll be in 10 or 15 or 20 years from now. We hope these will be more readily available to use on larger farms and that they become more costeffective and specific for even smaller farms.”

How energy is used Using energy-efficiency

“There aren’t many factories that come in and produce more energy with their byproducts than they’re using.”

Cost benefits There are “multiple spokes

www.cleanwisconsin.org

technology, excess heat is captured from various processes in the cheesemaking buildings and used to heat several other farm buildings. In addition to manure, all water used to wash and cool cheese and equipment is sent to the digester for electricity production; the digester produces enough electricity to power the farm, the cheese factory and roughly 300 homes in the community.

Finally, those digested solids are re-circulated to the farm fields to supply added nutrients.

Farm Facts

“We look at ourselves as ‘Is this right for us? Is this right for the environment? Is it right for our business? Is it right for our community and our customers?’ When we answer yes to all those, then if you want to call us a leader, that’s up to you. These are things we just do…

Really, farmers have always been the first recyclers and conservationists: growing the crops to feed the livestock, and the manure would be recycled back to the land to fertilize next year’s crops. It’s just at a different level now where we’re even producing electricity.”

to the wheel,” says George, noting the huge monetary savings gained from conserving and reusing energy. The digestion process converts manure into a higher-quality fertilizer for their crops.

Crave Brothers | page

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Moving Forward Wisconsin voters want more of our energy to come from renewable sources: A January 2012 poll found that nearly nine in 10 Wisconsin voters support increasing the use of wind and solar power to meet our state’s future energy needs. While the farmers featured in this report show that renewable energy works for agriculture, there are a few policies Wisconsin needs to allow farmers to realize the full benefit of renewable energy and create an even playing field for these technologies to compete with traditional fossil fuels. By working to pass the following policies, decision-makers can invest in Wisconsin famers and move our state forward.

Clean Energy Contracts

Up-front financing costs can be a significant barrier for a farmer, homeowner or business to install a renewable energy system. While the payback on renewable energy can be attractive to investors, a hole in current law makes this financial relationship potentially risky. By changing current law to allow a third party to own a renewable energy system and sell the power back to the host farmer, homeowner or business through a clean energy contract, we can break down a key accessibility barrier to clean, renewable energy.

Net metering

Net metering is a policy tool that allows farmers to offset their electricity use by generating their own onsite. Like rollover minutes for a cell phone, net metering provides credits for extra electricity produced that a farmer can use in the future and ensures that owners get the same rate that they pay the utility for their electricity. To make renewable energy systems more affordable and accessible for all, Wisconsin should have a fair and uniform net metering policy across all utilities. Currently, only projects that are under 20KW in size qualify for net metering statewide. Raising this cap is critical to providing an even playing field for renewable energy in Wisconsin.

85%

67%

88%

Increased Renewable Energy Standard

The major driver of demand for renewable energy projects in Wisconsin has been our Renewable Energy Standard, which requires utilities to get 10 percent of their electricity from renewable sources by 2015. As of this date, all utilities are on track to meet this goal and many are already well beyond it. Our neighbors, Minnesota and Illinois, both have much stronger renewable energy standards and Wisconsin voters agree that it is time to catch up with the neighboring states: eight in 10 voters’ support increasing Wisconsin’s Renewable Energy Standard to 30 percent.

page 10 | Moving Forward

84%

of Wisconsin voters support increasing the use of wind to meet our energy needs; 89% support increasing solar of Wisconsin voters believe we should prioritize clean, renewable energy over fossil fuels

of Wisconsin voters are willing to pay more to promote clean, renewable energy

of Wisconsin voters support a 30% Renewable Energy Standard

Rural Energy Report

Resources for Farmers Focus on Energy www.finditwithfocus.com Find incentives and providers that can help farmers, as well as businesses and homeowners, save money on their energy bills.

Energy Self Assessment Tools www.ruralenergy.wisc.edu This website features a series of online modules designed to help farmers identify energy efficiency or renewable energy projects that could work on their farms.

Natural Resources Conservation Service www.nrcs.usda.gov Visit this division of the U.S. Department of Agriculture for the latest federal programs designed to save farmers money through conservation.

www.cleanwisconsin.org

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