Essay on Dfnaklnlk

9896 Words Dec 14th, 2012 40 Pages
Investing in Methane Digesters on Pennsylvania Dairy Farms: Implications of Scale Economies and Environmental Programs
Elizabeth R. Leuer, Jeffrey Hyde, and Tom L. Richard
A stochastic capital budget was used to analyze the effect of net metering policies and carbon credits on profitability of anaerobic digesters on dairy farms in Pennsylvania. We analyzed three different farm sizes—500, 1,000, and 2,000 cows—and considered the addition of a solids separator to the project. Results indicate that net metering policies and carbon credits increase the expected net present value (NPV) of digesters. Moreover, the addition of a solids separator further increases the mean NPV of the venture. In general, the technology is profitable only for
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Tom Richard is Associate Professor in the Department of Agricultural and Biological Engineering, also at the Pennsylvania State University in University Park, Pennsylvania. The authors wish to thank Joshua Duke, co-editor of this journal, and two anonymous reviewers for helpful suggestions that improved the clarity of the paper. We also thank Pat and Deb Topper for sharing their experiences from working with digesters and farms. Finally, we thank USDA/CSREES for financial support of this work.

individual farms (i.e., case studies), we use a model to compare several scenarios, including the application of benefits realized by farms via net metering laws and carbon credits. Literature Review Anaerobic digestion is the process by which manure generates biogas, a mixture of methane (CH4) and carbon dioxide (CO2), without the presence of oxygen. Manure is made up of water and solids. The solids, often referred to as total solids (TS), consist of volatile solids (VS) and ash. When manure enters the digester, the VS are digested by several types of bacteria. In the early stages of digestion, one type of bacteria breaks the manure into simple fatty acids, carbon dioxide, and hydrogen. The simple fatty acids and hydrogen are then converted by a different type of bacteria into methane and more CO2. To operate correctly, the digester must maintain the appropriate temperature and a pH

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