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US biogas and dairy applaud Agriculture Environmental Stewardship Act

New bipartisan legislation, the Agriculture Environmental Stewardship Act (HR. 5489), was introduced June 16 to the US House of Representatives. US biogas and dairy sectors applaud the bill saying it will increase the sustainability of farms by helping to deploy new nutrient recovery and biogas systems to recycle organic material into baseload renewable energy and healthy soil products.

In a bid to incentivise environmental stewardship amongst dairy farmers through existing tax policy new bipartisan legislation, the Agriculture Environmental Stewardship Act (HR. 5489), was introduced June 16 to the US House of Representatives. Both the American Biogas Council (ABC), the US national trade association for the American biogas industry and the National Milk Producers Federation (NMPF), representing US dairy producers and the cooperatives they own, applaud the bill saying it will increase the sustainability of farms by helping to deploy new nutrient recovery and biogas systems to recycle organic material into baseload renewable energy and healthy soil products. The Act provides a 30 percent investment tax credit (ITC) for qualifying biogas and nutrient recovery systems. A similar bill is expected to be introduced to the Senate later this year.

– For a healthy economy, we need healthy soils and clean waterways. Biogas and nutrient recovery systems contribute to cleaner, healthier soil and water and the Agriculture Environmental Stewardship Act will make these systems possible, said Patrick Serfass, Executive Director of the American Biogas Council in a statement.

Addresses multi-benefits

According to ABC the introduction of HR. 5489 reflects the critical need to support economically and environmentally sustainable agricultural practices that protect waterways and enrich soils. Currently no tax incentive exists for nutrient recovery systems, which farms increasingly need to properly manage the nutrients found in raw manure. Currently, only biogas projects that generate electricity are eligible for a production tax credit under Section 45 of the federal tax code, omitting other energy uses like production of pipeline quality natural gas and compressed renewable natural gas vehicle fuel.

– This measure recognizes the value that biogas systems can have as dairy producers continue improving the sustainability of their farms, large and small, across the country. Importantly, the creation of this new investment tax credit also addresses the value of nutrient recovery technologies, which can transform manure into fertilizer for crops and bedding for cows. This bill will help dairy farmers to utilize these new, often expensive technologies on their dairies, said Jim Mulhern, president and CEO of the National Milk Producers Federation.

By deploying nutrient recovery systems that allow farms to apply nutrients when and where they are needed throughout the year, farms greatly reduce the potential environmental impact and the use of expensive chemical fertilizers. While nutrient recovery systems can be used alone, their performance is enhanced when used with a biogas system. As the digestate is already warm and homogenous as it leaves the biogas system, nutrient separation is more efficient and the reliability of separating or concentrating the nutrients from the digestate is increased. This allows farmers and landscapers greater control of how much of each nutrient such as nitrogen, phosphorus and potassium is applied to the soil.

Concurrently, the digestate leaving the biogas system is virtually odourless and devoid of fly larvae – and importantly – as much as 99 prcent free of pathogens, preventing the spread of E. coli in watersheds. In addition, biogas systems capture all of the methane to generate baseload renewable energy, preventing greenhouse gas emissions and reducing reliance on fossil fuels. Combined, the biogas and nutrient recovery systems create jobs both during construction and ongoing operation of new systems through the daily input and processing of organics and the use and sale of energy and nutrients.

US biogas market potential

Currently, the US has over 2 100 sites producing biogas of which, according to the Environmental Protection Agency (EPA), just over 250 biogas systems are operational or under construction on dairy and pig farms. Yet the potential for growth of the US biogas industry is huge. A recent industry assessment conducted with the USDA, EPA and DOE as part of the Federal Biogas Opportunities Roadmap estimates that nearly 11 000 sites are ready for development of which 8 000 are farms. If fully realized, these new biogas systems could produce enough energy to power 3.5 million American homes and reduce emissions equivalent to removing up to 11 million passenger vehicles from the road. It would also result in an estimated US$33 billion in construction spending, creating approximately 275 000 short-term construction jobs and 18 000 permanent jobs to operate the biogas systems and manage ongoing business activities.

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