Biogas Economic Assessment Tools
Brent Gloy, Ph.D.
The following worksheets itemize the inputs that one would need to conduct an economic assessment of a biogas project. The inputs are designed for use with two Microsoft Excel spreadsheets.
The inputs are used to create proforma financial statements for the biogas project and to conduct a discounted cash flow analysis of the project. A basic understanding of financial concepts is required to understand and interpret the outputs of the spreadsheets. These tools should only be used for an initial analysis of a biogas project. A more thorough analysis is required to establish the expected profitability of the project.
Users should carefully consider the validity of the assumptions utilized in the assessment before making investment decisions. In other words, these tools should be used with caution and no warranty is made regarding the validity of outputs obtained and decisions made based upon the model. The assessment does not consider the impact of any taxes that may be generated or saved by the project. These values may significantly alter the profitability of the project. The spreadsheets do not currently consider inflation or allow for changing prices over time. These assumptions can be modified with modest alterations to the spreadsheets.
In both spreadsheets, users should be careful to enter parameter values that correspond to the units listed in the spreadsheet. The spreadsheet will not identify inappropriate units or entries that are unrealistic.
Two tools are available
- The first tool is designed for use with Farm Ware 3.1 which was developed by the United States Environmental Protection Agency and is available for free download atwww.epa.gov/agstar/resources/handbook.html.This analysis uses the outputs of Farm Ware 3.1 to conduct a financial analysis. This worksheet does not guide the user through the inputs required to conduct a Farm Ware assessment.
- The second tool allows the user to input more detailed information about their specific anaerobic digestion project. The tool requires that the user possess information about the capital and operating costs for the project. It utilizes a variety of assumptions to create estimates of the biogas and electrical generation potential of the project.
Dairy Air Emissions
- Dairy Air Emissions: What You Must Know - Curt Gooch, Karl Czymmek, and Frank Mitloehner (2011)
- Dairy Ammonia Loss Estimation Worksheet - Karl Czymmek and Curt Gooch (2009)
Digester Simulation Module and Greenhouse Synergy
- Partnering Commercial Greenhouses with Dairy Manure-Based Anaerobic Digestion Systems - Quantifying Energy Synergies - Timothy J. Shelford, Curt A. Gooch, and Peter E. Wright (2016)
- Coupling Dairy Manure Anaerobic Digesters with Commercial Greenhouses - An Assessment of Technical and Economic Feasibility - Timothy J. Shelford, Curt A. Gooch, and Peter E. Wright (2015)
- Heat Transfer Model for a Biogas System
Manure Storage Cover Cost Calculator
Water Use Reporting
On August 15, 2011 Governor Cuomo signed a law that updates water use reporting and permit requirements for users of large volumes of water in New York State (http://www.dec.ny.gov/lands/86747.html ). NYS Department of Environmental Conservation (DEC) indicates that the reporting of water usage provides them with needed information to manage the state’s water resources. The law has a provision that waives reporting fees for agricultural users. It also exempts some agricultural water users from reporting and clarifies obligations for other farms. The bottom line:
Agricultural water users withdrawing an average of 100,000 gallons or more of water per day in any month during the previous year (2015) from any combination of groundwater and surface freshwater sources are required to register their water withdrawals with NYSDEC.
All other farms using freshwater for agricultural purposes at a monthly average rate of fewer than 100,000 gallons of water per day for all months are exempt from reporting.
Water use on a dairy farm depends on many factors, most notably: number of animals, level of milk production, size of milking center and other areas cleaned with fresh water, use of a milk pre-cooler and/or summer cooling of cows (sprinklers), and, for some cases, irrigation of crops.
For farms with multiple sites, generally, locations that are contiguous or that share water supplies should aggregate water use for reporting purposes, while non-contiguous sites should estimate water use separately. Farms solely on public water supplies are NOT required to register because their water use will be reported by the municipal water provider.
Because it can be difficult to accurately estimate water use for many dairy operations, the PRO-DAIRY Environmental Systems Group developed this Calculator for use by farmers and their advisors. The Calculator has been reviewed and approved for use by NYSDEC. The Calculator can be used to estimate a farmstead’s water use (barns, milking center, etc.) and also has provisions for entering in other uses of water on the farm such as crop irrigation. Based on inputs by the user, the Calculator estimates the average daily water use for each month. While the estimating formulas were developed for Holstein water consumption, Jersey cow water consumption is close enough that in the overall calculation of water usage should not be significantly affected.
This year the calculator has been modified to use “Typical Meterological Year” data in the estimation of cow water consumption, rather than reported values for each particular year. The difference between using typical and year specific climate data should produce negligible differences in farm total water consumption and will allow the calculator to be used for subsequent years without waiting for climate data updates. By using Typical Meterological Year data we were also able to expand the number of climate data sites from five to 19 to provide more options for finding a weather station that best represents the climate of the farm.
Some users have reported difficulty opening the current DEC water use reporting form. DEC is aware of the issue and it seems to be related to users who have the Chrome browser. One workaround is to save the linked file to your computer (right click on the link and select "Save Link As"). Then open Adobe reader (should be listed under your program files). Once Adobe reader is open, select "File" and then "Open" and then select the saved water use form. It should now open correctly. For assistance filling out the form please contact Richard Kruzansky, richard.kruzansky [at] dec.ny.gov, 518-402-8182.
In previous years, the form could be automatically completed by the Calculator However, due to the new DEC form, users will have to transfer values from the Calculator to the form manually. Once the form is completed it can then be submitted electronically or printed and returned to NYSDEC by US mail. Farms should discuss business confidentiality issues with their legal advisors.
The DEC reporting form is designed for a broad range of users and asks for information that many dairies are unlikely to have ready access to. Producers are encouraged to answer as completely as possible and to do the best they can when there are information gaps.