At Vintage Dairies just south of Fresno, a huge plastic tarp stretches across a
five-acre lagoon where cow manure is mixed with water and decomposes.
Massive bubbles under the tarp are captured methane gas. The methane is pulled out and turned into high-grade gas, which is sent down a PG&E transmission line to a power plant up north.
"We're milking 2,400 cows right now and producing enough power for about 1,000 homes," said David Albers, president president of Bioenergy Solutions.
It's the first and only methane-to-market system in the state.
Albers created Bioenergy Solutions to tap into the biomethane market.
He says the system is working well, but needs fine tuning.
"It's running well, but not perfectly. Some of this equipment is rented. Some equipment is temporarily installed as we gear up for a larger project. So it's very close to what we expected, but not quite there."
Albers says his experience as an environmental lawyer for the dairy industry led him to push forward with the project. "Every time we'd go in for a permit, someone would oppose it. One argument would always be "why don't you put in a digester?" -- a process that breaks down animal waste and produces methane gas in the process.
And in every case, our analysis would conclude it was economically infeasible ... one or two million dollars in expenses and no buyer for the energy he would produce."
Now, with utilities under orders to produce a third of their power from renewable energy sources by 2020, biomethane plants are more attractive.
"Processing manure at dairies for methane injection helps reduce greenhouse gas emissions from those dairies,'' said Ken Brennan, PG&E gas transmission department. "It also precludes the NO2 or nox gases normally associated with buring gas for on-site generation out there in the valley. Biomethane operations also operate 24/7 which is a big advantage."
It's an idea whose time has come, said Albers. "Cow power creation is catching on. Forty dairies have signed 10-year contracts to have their methane captured. Another 140 dairies have signed letters of intent. All that's needed now ... is the money."
Albers says he needs $40 million dollars to fill his current contracts. "It's been a tough year to raise money. The markets are frozen, banks aren't wiling to lend. It's tough for us. We built this with plans to expand, but that hasn't happened."
Shafter dairyman Ben Goedhart has signed on with Albers. He sees great promise in cow power. "We're just waiting for the financing." he said. "I thought it would be done already, but it's taken longer that we thought it would."
Albers envisions one day capturing biomethane gas from clusters of dairies, up to 12 dairies linked to one refining plant, where the methane gas is cleaned. "Our company alone could provide enough energy for a million homes, just from the dairy industry."
And Albers says it's a win-win for the dairyman.
His company builds the biomethane facility with its own money. The dairyman has no out-of-pocket expenses, and gets a cut of the profits from gas sales to the utility.
And because he's voluntarily making an environmental improvement to his dairy by treating his manure and reducing his carbon footprint, he receives emission reduction credits from the government, which can be sold annually on the carbon market.
Goedhart adds, "It will make for a cleaner operation. And we'll also be paid for our manure. So we're making money on what goes in the cow and what comes out."
Exactly how much gas Albers has sold to PG&E, and his profits from those sales are confidential. But albers says a dairyman could realize a six-figure revenue stream by capturing biomethane gas.
The big question now is whether regulators and policy makers will allow large dairies to install digesters, at their own expense. That discussion is looming large in 2010 for Kern County Supervisors, environmental groups, and the dairy industry.
