An Engineering-Economic Model for Analyzing Dairy Plug-Flow Anaerobic Digesters: Cost Structures and Policy Implications

Treating animal wastes through anaerobic digestion (AD) yields methane-rich biogas that can be used for power generation or heating, and a nutrient-rich digestate that can be land-applied as fertilizer. Furthermore, AD reduces odors from stored and land-applied manures. Despite these benefits, AD deployment rates in the U.S. are only 5% for dairy farms identified as suitable for AD by the U.S. Environmental Protection Agency. The objective of this study was to analyze the economic and technical limitations of farm-scale anaerobic digesters using a simple model permitting insight into the fundamental constraints on the technology. A model was developed to determine the cost of methane produced via AD based on operation size. Dairy plug-flow systems were modeled because of their well-documented economic performance, and model validation used data from AgSTAR's FarmWare program. The analysis shows that farm size is critical to make digestion-derived methane cost-competitive with natural gas. At low herd sizes (