STATE REGULATION OF ON-FARM ANAEROBIC DIGESTION

CALIFORNIA AND NEW YORK

Introduction of off-farm waste streams to agricultural manure digesters is leading to some hybrid approaches in state permitting and rule development.

A NUMBER of states have granted operating permits to on-farm anaerobic digester facilities that process farm manure and other organics for biogas production and subsequent on-site electrical generation. Some of those facilities are also permitted by the agencies to codigest nonagricultural feedstocks such as fats, oil, grease and food processing residuals, which are usually managed as municipal solid waste. When such materials are added, the farm may generate tipping fees and can produce significantly more methane per ton than by using manure alone, and thus can produce more electrical power.

Regulation of such AD systems has required states to come up with a hybrid of permitting requirements involving regulations applicable to CAFO (confined animal feeding operations), AFOs (animal feeding operations), municipal solid waste, wastewater treatment, air emissions, and nutrient management plans. On top of such state regulations are local zoning and building code requirements. Unlike the U.S. Environmental Protection Agency's Part 503 regulations that set minimum standards for reuse of biosolids, there are no comparable federal standards for operation of anaerobic digesters (AD) for processing manures and food waste. Therefore, regulatory agencies are cutting their teeth on permit applications submitted for such AD projects. Another article in this month's BioCycle Energy section about the Mead, Nebraska facility that processes only on-site generated material, illustrates the importance of the permitting process in development of AD facilities, particularly its impact on capital costs.

As the first in a series of articles on regulations and permitting for anaerobic digesters, BioCycle reviewed requirements in California and New York. From a regulatory perspective, AD may be considered a variation of composting because it is a biological process which maximizes anaerobic bacteria instead of aerobic bacteria and fungi. However, many AD systems operate at around 100�F rather than 131�F as required by the USEPA Part 503 regulations and some state composting regulations. The AD process extracts methane and produces a solid material (digestate) that can be processed, usually through composting, to achieve further pathogen reduction.

CALIFORNIA REGULATORY STRUCTURE

Scott Anders at the University of San Diego's Energy Policy Initiatives Center recently released a paper titled Biogas Production and Use on California's Dairy Farms, A Survey of Regulatory Challenges (August 2007). The paper identifies regulatory challenges in the areas of water, air, electricity, natural gas, and solid waste management. Anders notes that California has 22 anaerobic digesters located on dairy farms, and he identifies the following California state agencies that have some jurisdiction over major portions of biogas production and consumption:

* California Integrated Waste Management Board (CIWMB) has jurisdiction over solid waste disposal, recycling, and composting.

* California Air Resources Board and 35 local air pollution control districts (APCDs) regulate air emissions from mobile and stationary sources.

* State Water Resources Control Board and nine regional water quality control boards are charged with protecting and preserving the water resources of the state.

* California Public Utilities Commission regulates privately-owned electric and natural gas companies.

The CIWMB does not have a statutory or regulatory definition for anaerobic digestion, something that would help to resolve jurisdictional questions for project developers. Anders points out ambiguity over the extent to which the CIWMB has jurisdiction over AD systems.

The only APCD that is currently regulating ADs at dairies in California is the San Joaquin Valley APCD. This district is located in the southern portion of the Central Valley which has significant air pollution issues related to various sources. The district has identified ADs as a good control method for air emissions from manure storage facilities, but does not mandate their use due to the high costs relative to the expected air quality benefits.

With respect to regulatory programs for protection of water quality, Anders notes that historically in California, animal feeding operations such as dairies, feedlots, and poultry facilities operated under a waiver of permit requirements. However, as described below, that situation has changed.

John Menke is a Senior Environmental Scientist with the California Water Resources Control Board and is the Board's technical expert on AFOs and ADs. He notes that California regulations prohibit dairies from discharging manure to surface waters, even during a 25-year, 24-hour storm. Although most AFOs in the state voluntarily comply with the discharge prohibition, some dairy operators did not construct adequately-sized lagoons or storm water containment facilities and as a result had discharges, primarily during storm events. To address such discharges, the state formed an Attorney Task Force to initiate enforcement action. According to Menke, there have been over 100 enforcement actions against dairies in California over the past eight years. Fines are generally in the tens of thousands of dollars for discharges but have been over a million dollars for repeat offenders.

Since few dairies in California discharge manure to surface water, few AFOs are required to obtain NPDES permits. Instead, most dairies are now regulated through Waste Discharge Requirement (WDR) Orders - essentially state permits issued by the regional water quality control boards. Menke notes that there is great regional diversity between dairies within California, where North Coast dairies typically milk 250 to 300 cows and are on pasture, and many dairies in the Central Valley milk more than 1,000 cows and have lagoons that can exceed 40 million gallons. "Given that diversity, it makes sense for each region to develop its own regulations," he explains.

An exception to the use of WDRs is the approximately 170 dairies in the Santa Ana Region in southern California. That region includes the Chino Basin where, due to urban expansion, little cropland remains for manure application. As a result of several manure discharges into the Santa Ana River, all dairies and feedlots in that region are under a general NPDES permit.

Menke notes that WDR Orders have an advantage over NPDES permits in that the WDRs are more appropriate for protection of groundwater. "We're very concerned about salts and nitrate in groundwater in California," he says. "We try to maintain water quality at its ambient concentrations, and we work to ensure that a discharge activity does not make the water unusable." Menke explains that there is an upper limit of 1,000 ppm salt, above which the water is not suitable for use as drinking water. "However, for some beneficial uses the acceptable upper salt limit is lower, and for some specific salts or ions the upper limit may be a low value." Using a WDR Order means that all AFOs, not just concentrated animal feeding operations (CAFOs), can be required to utilize nutrient management plans.

"We recognize that ADs have great benefits for reducing emissions of greenhouse gases and improving air quality," adds Menke. "But the digester does not decrease the salts and nutrients in the manure, and we want to ensure proper management of the organic residuals and effluent that are discharged." He notes that they are particularly concerned about codigestion because the imported feedstocks may add salts and nutrients. A few of the approximately 20 ADs at dairies in California currently use codigestion.

CODIGESTION CONSIDERATIONS

For codigestion of manure and off-farm wastes in the Central Valley, Menke says there is a case-by-case review and development of an individual WDR Order. "The big problem is a lack of characterization of the waste stream. For example, if a farmer wants to add 10 percent tomato processing waste to a manure anaerobic digester, they have to provide the expected concentrations of salts and other pollutants in the proposed waste and demonstrate that water quality is protected. We have asked how salts are handled in Europe where they have more anaerobic codigestion systems, and have found that salts do not seem to be much of a concern in Europe. Since California has a greater dependence on groundwater for domestic consumption and irrigated agriculture, we need to ensure that down-gradient water users are not impacted by salts from both natural occurrence in the soil, as well as from upstream farm fields."

In Southern California, the Inland Empire Utility District operates a regional digester that utilizes manure from about eight dairies. Some of the energy produced is used to power a reverse osmosis system that treats drinking water for the region. Effluent from the AD is discharged to a "brine line" that goes to the regional wastewater treatment plant, which discharges its treated effluent into the Pacific Ocean. No such brine line exists for dairies in the Central Valley.

About 1,600 of the state's 2,000 dairies are located in the Central Valley Region, and the Central Valley Water Regional Board has identified the following water quality concerns related to anaerobic digestion: (1) Use of off-site waste in codigestion, which can increase the salt and nitrate content of digestate; (2) Ability of lagoons to safely contain digestate, in particular from codigestion; and (3) Potential groundwater quality impacts from the effluent stored in lagoons.

In May 2007, the Central Valley Water Board adopted a General WDR Order with requirements that apply to the construction of holding ponds, the operation of ADs, and the discharge of manure to cropland. Any dairy operator in the Central Valley wanting to cover an existing storage pond to capture methane gas or to construct a new AD must file a Report of Waste Discharge (ROWD) that describes the digester and how digestate and effluent from the digester will be managed to protect water quality. Board staff will review the ROWD to ensure adequate protection of water quality. For a new lagoon system to be approved, an engineering study must prove through modeling that there will be no unacceptable degradation of groundwater quality.

Recognizing regional water board's regulations, Ander's report recommends that "California should evaluate the possibility of developing a permit process for complex and cross-cutting projects like biogas production... Because biogas production and use requires approval from so many different state and local agencies, centralizing and standardizing the permit process could help to ease the regulatory burden for participants and help California attain its greenhouse gases reduction goals."

Echoing Ander's conclusions is Ruth MacDougall of the Sacramento (CA) Municipal Utility District (SMUD), an electric utility with a commitment to greenhouse gas reduction. SMUD's official policy is to "pursue renewable energy supplies and other non-greenhouse gas emitting energy resources," which currently includes the purchase of 5 MW of power from the Sacramento County Regional Sanitation District's biosolids digester. "We want to get farms to put in anaerobic digestion systems and we have sponsored some research which shows farms can be a good source of renewable energy for our electrical district," says MacDougall. "We have one farm putting in an AD system, but a big problem is that the regulations are not well defined, and we believe it would facilitate more AD projects if we had consistent standards."

NEW YORK STATE'S COOPERATIVE AGREEMENT

New York State has several anaerobic digestion biogas systems operating on farms, including CAFOs. Some of the facilities have been permitted in accordance with the state's solid waste facility regulations, and some under the CAFO regulations, and at least one under both. To avoid such "double regulation" in the future, the two divisions of the State Department of Environmental Conservation (DEC) that regulate solid waste and CAFOs recently drafted a cooperative agreement that allows farms with a CAFO permit to process off-site generated food waste, with no solid waste facility permit required.

Sally Rowland, DEC Environmental Engineer charged with overseeing the state's Part 360 rules for organics recycling projects, explains that the Part 360 regulations are in the process of being amended to reflect food processing in accordance with CAFO permits. "Under a farm's CAFO permit we are confident that the permit addresses all of the issues of concern," she says. "However, for farms that do not have a CAFO permit, a Part 360 solid waste permit will be required to handle food materials." Part 360 permits address the design and operation of a facility, its capacity, and potential environmental impacts of noise, odor, and run-off.

A Part 360 solid waste permit was issued to the Cayuga County Soil and Water Conservation District in 2006 to construct and operate a facility in the Town of Auburn that will anaerobically digest 40,000 gallons/day of dairy manure and straw bedding, 4,200 gallons/day of potato processing wash water, 2 tons/day of potato clippings, and 6 tons/day of grease/cooking fats. The District anticipates using a German mesophilic hydraulic mix digester technology (GBU) that agitates the manure by downward flow of the liquid, minimizing moving parts. Once completed, the methane will be burned in a Jenbacher gas engine to produce electricity and hot water to heat an adjacent nursing home, jail, office building, and maintenance shop, with excess power sold to the electrical grid. Digestate will be dewatered and the solids composted on a 2-acre pad in accordance with pathogen reduction requirements of a Class A compost for use on sites other than farmland. The liquid will be transferred to local farms for land application as fertilizer, in accordance with the farm's nutrient management plan or a land application permit under Part 360.

New York State also requires the Cayuga County facility to have a storm water discharge permit for construction activities, as well as implementation of a storm water pollution prevention plan. Although the facility is not a CAFO, the Part 360 solid waste permit requires any CAFO permitted facility "importing or exporting waste to or from this digester facility to update their CAFO required Comprehensive Nutrient Management Plan."

Due to the gas engine, a DEC Part 201 air facility registration certificate for the exhaust emissions is also required. The air registration also covers a safety flare that will be operated when the generator system is not operating, or when the biogas storage system cannot accept biogas.

Jim Hotaling, who manages the Cayuga County Soil and Water Conservation District's community digester project, explains that several other local permits were required, including state historical commission review, a wetland permit from the U.S. Army Corps of Engineers, and county permits for the building and the access road. Illustrating the project specific nature of such innovative projects, the host Town of Auburn raised concerns about the potential for explosions associated with the new facility. hotaling says that this issue was eventually resolved. "The Town's main concern about the project was liability from explosions, so a couple of months were required to have the attorneys for both parties negotiate an agreement where the County assumes liability for such an accident."

Also located in the Town of Auburn, the Patterson Farm received a Part 360 approval in 2005 for a "research, development and demonstration permit" for a manure and 18,000 gallon/day food waste anaerobic digester. The digested food waste/manure mixture is separated into solids, which are used for bedding, sold as compost, or land applied per the farm's CAFO Manure Management Plan. The Part 360 permit states that "only food processing waste approved under the farm's CAFO permit can be processed at this facility. Land application of digester residue must be in accordance with the CAFO permit, and other treatment and disposal options must be in accordance with Part 360."

The DEC, through its Division of Water, has issued a General State Pollutant Discharge Elimination System (SPDES) Permit for CAFOs. The permit includes minimum standards for protection of water resources that are applicable to all CAFOs, as well as specifications for developing Comprehensive Nutrient Management Plans in accordance with the Natural Resource Conservation Service's Conservation Practice Standard No. NY312. For a CAFO to be in compliance with the CAFO permit, "there shall be no discharge of process wastewater pollutants to the surface water of the State, except for releases in excess of the 25-year, 24-hour storm event. Process water is defined as any wastewater, leachate or precipitation that comes into contact with manure, bedding, grain, or other organic materials."

Therefore, each CAFO farm must have lagoons and treatment systems to comply with those requirements, even if no food waste is handled. In addition, any farm with a CAFO permit must amend its nutrient management plan if any significant changes are made in the facility, such as adding food waste.

In addition to providing legal protection for its manure management practices, as well as savings in fertilizer costs associated with nutrient management plans, the DEC recognizes that another potential benefit to CAFO permitees is renewable energy production. Notes DEC's website: "If green power, such as electric generation from an anaerobic digester, or CO2 trading becomes popular, the comprehensive nutrient management plans needed for the CAFO permit may be required to certify the farm is green."

Information on how other states and Canadian provinces are regulating onfarm digesters and processing of off-farm feedstocks in those systems will be addressed in future articles. If New York's approach of regulating on-farm digesters through the CAFO process is deemed successful, it is likely other states will follow suit. Other states may follow California's approach to empower regional boards to determine permit conditions that are based on regional geographic differences such as size of farms, annual precipitation, water quality, soil conditions, and agricultural practices.

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Permitting anaerobic digesters is sometimes done in accordance with an existing CAFO permit.

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Among the Central Valley Water Regional Board's water quality concerns is possible increase in salt and nitrate content of digestate if off-site waste is codigested with manure.

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Patterson Farm received approval for a "research, development and demonstration permit" for a manure and food waste anaerobic codigester.