Steve Shehadey’s family has been in the dairy business for a long time – more than half a century. You may even be familiar with his uncle’s operation, Producers Dairy in Fresno.
“I'm third generation, I've got a daughter who's interested who's probably going to be fourth generation,” Shehadey said.
Shehadey’s dairy in the nearby city of Kerman, called Bar 20, is one of his family's newest. It’s so modern it produces not just milk, but also electricity, and that powers electric vehicle chargers owned by carmaker BMW. That technology, whisper-quiet and housed in a complex of metal boxes about the size of two 18-wheelers side-by-side, is called a fuel cell.
“From the fuel cell it goes into the electric grid, it interconnects with PG&E,” Shehadey said. “So extra power goes straight into the grid for everybody to use.”
Fuel cells are typically powered by chemical reactions between hydrogen and oxygen. At Bar 20, however, those reactions are driven not by hydrogen but manure. Specifically, the methane coming off of manure.
Cow dung is responsible for abouta quarter of the state’s emissions of methane, a powerful greenhouse gas that’s around 25 times as potent as carbon dioxide. Cow burps are a major methane source, too.
At Bar 20, the methane for the fuel cell is supplied by a facility called an anaerobic digester, which processes manure and captures the gases it emits. Here’s how it works: Manure that would typically be stored in an open lagoon is instead funneled into a lined and covered basin, which at Bar 20 is the size of 40 Olympic swimming pools.
“You definitely want a wetsuit, not recommended at all for swimming in,” joked David Wilbur, a vice president with California Bioenergy, the company that installed the digester, as he, Shehadey and others gave me a tour.
The methane, which puffs up the cover like a balloon, is captured and siphoned off to the fuel cell, where it’s converted to electricity. Other manure components are reused, too: The liquids are filtered and used for irrigation onsite, while solids are recycled as livestock bedding.
Do digesters pose dangers to San Joaquin Valley communities?
Digesters around California are estimated to havealready prevented more than a million tons of emissions. But as they’ve advanced, the state – and the Shehadeys – have found themselves fending off criticism of the technology, despite the fact thatthe state touts it as one of California’s most cost-effective climate-change-fighting tools.
“If you can clean air and produce renewable power for the state, especially as we're converting to more usages for electricity, it seems like a great solution,” said Shehadey.
Digesters are a fast-growing business. In 2015, the state had funded six of them. By 2020,that number had skyrocketed to 117.
But that growth is what worries community advocates. Dairies with digesters receive financial credits for the emissions they capture through a state program known as the Low Carbon Fuel Standard (LCFS) that works much like cap and trade. But advocates are calling on state air officials to stop offering LCFS credits for digesters.
One of their arguments is that the state’s emissions calculations are inaccurate and lead to inflated estimates of digester-related methane reductions. Another is that by monetizing manure, digesters incentivize dairies to expand their herds. That, in turn, leads to concerns about growing water contamination, odors and other air pollution that could harm nearby communities. Not to mention the fact that cow burps — which are estimated to contribute nearly as much of the state’s methane emissions as manure — are not captured by digesters.
“Any program that actually incentivizes the creation of methane and also the perpetuation of the unequal kind of local and regional burdens of dairies is problematic,” said Phoebe Seaton, co-founder of the non-profit Leadership Counsel for Justice and Accountability and co-author ofa petition submitted to state air officials in October to remove dairy digesters from the LCFS program.
Recent data to confirm herd size is hard to come by, and the industry says the idea of manure driving dairy growth is hogwash. Still, Seaton questioned whether taxpayers should be footing the cost of a technology with such imbalanced local and statewide impacts, even though there's an urgent need to address our methane crisis.
“The state is responsible for creating this policy framework that is continuing to dump on communities in the San Joaquin Valley,” she said.
In response to the petition, the California Air Resources Board (CARB)denied the request to immediately drop digesters from the LCFS program but agreed to hold workshops to discuss the issue. Matthew Botill, who oversees climate change programs with CARB, maintains that his agency’s emissions reductions calculators are accurate, and that digesters are essential to achieving our climate goals.
“On a broad basis, dairy digesters reduce greenhouse gas emissions more cost-effectively than alternative strategies,” he said.
Digesters are critical to climate change fight, proponents say
Botill and other air officials estimate that meeting the state’s climate goals would require constructing another 200 digesters by 2030. But Michael Boccadoro, a lobbyist and executive director of the non-profit Dairy Cares, warns that losing emissions credits would kill those projects, which could in turn export our environmental challenges elsewhere.
“Dairies won't be able to get the projects built. Cows end up on U-Hauls and they end up moving to another state where the problem is going to be exacerbated,” he said. “So, less regulation, less efficient production, higher methane, higher global warming.”
For some dairies, credits amount to millions of dollars each year. “A hypothetical 3,000 milking cow dairy supplying transportation fuel could generate approximately $3.5 million in annual LCFS credit value,”reads a recent CARB report.
Boccadoro, however, points out that’s not the cash cow it sounds like: Engineering firms, developers, and other companies involved in building and running digesters all get a slice of those profits, too. In fact, according to Boccadoro, some dairy operators don’t share any of those profits, except for a fee per head of cattle for providing manure as a feedstock.
According to Steve Shehadey, the Bar 20 digester and fuel cell cost $13 million. The prospect of annual credits did grease the wheels, but he’s got his eye on other existential threats, too. From his perspective, drought, water restrictions, and the rising costs of energy and fertilizer make that income a matter of survival.
“There's only so many ways to make money on a dairy,” he said. “It's your milk price, your beef price and your manure now. And so how can you maximize each area of your dairy?”
With such a high price tag, he suspects it’ll be a while before he sees any return on his investment.
*An earlier version of this story misrepresented the Leadership Counsel for Justice and Accountability as being opposed to dairy production in California.
This story is part of the Central Valley News Collaborative, which is supported by the Central Valley Community Foundation with technology and training support by Microsoft Corp.
