PennVEST Approves $7.8 Million for Kreider Farms Dairy Project

On of the projects approved this week by the Pennsylvania Infrastructure Investment Authority was a $7.8 million loan to Bion PA for a livestock waste treatment system designed to generate nutrient reduction credits.

 

The facility will be located on the Kreider Farm in Manheim, Lancaster County, and involves treating the waste from nearly 2,000 dairy cows to generate cellulose that will be burned along with poultry waste to generate energy. In addition, the company expects to generate greenhouse gas credits using the process and generate a stabilized fertilizer. (See project announcement.)

 

This is the first project approved by the PennVEST Board that supports waste treatment infrastructure at a CAFO (confined animal feeding operation) for the purpose of generating nutrient credits. Based on this approval, Bion will move forward with engineering and permitting for the Kreider project while finalizing definitive agreements with PennVEST.

 

Over the past two years, Bion has worked with the Department of Environmental Protection and representatives from Pennsylvania State University to establish an acceptable nutrient credit calculation and verification methodology for the Kreider Farm project, which was approved by the DEP in mid-2008.

 

DEP approval projects a credit total in the range of 140 nutrient credits per milk cow's waste treated; with a majority of these credits will be generated from airborne ammonia reductions.

 

Ammonia air emissions from CAFOs are for the most part quickly re-deposited onto neighboring lands, which simply advances the nitrogen molecule's travels towards the Chesapeake Bay.

 

Bion's project at Kreider Farms will be the first comprehensive on-farm waste treatment plant installation in the state, generating a steady stream of more than 100,000 credits per year. In addition to this initial dairy installation, Bion is working on a second phase of the project that it believes will generate in excess of 1 million additional credits. Phase 2 is anticipated to include a renewable energy production facility that will convert cellulose in the waste stream into usable thermal energy.

 

According to the Chesapeake Bay Tributary Strategy, Pennsylvania's municipal wastewater treatment plants that ultimately discharge into the Susquehanna River watershed are required to reduce or offset their nutrient discharges by 7.5 million pounds per year.

 

Mark A. Smith, Bion's President, stated, "We are extremely pleased with the PennVEST Board's loan approval. This is a great example of what Pennsylvania's nutrient credit trading program was designed to do: achieve nutrient reductions required under the Chesapeake Bay Strategy at a fraction of the cost to upgrade municipal waste treatment plants. This value proposition is the essence of what new technologies and solutions need to accomplish - doing more with less - one of Bion's core principles. We look forward to working with PennVEST, DEP, U.S. Environmental Protection Agency and other stakeholders to achieve permanent, effective, and affordable solutions for the Chesapeake Bay."

 

To help put this investment in perspective, the $10 million 2008 Resource Enhancement and Protection Program (REAP) tax credit program that helps farmers install conservation practices helped fund 231 on-farm conservation practices and attracted $23 million of additional investment in conservation by farmers. (See 12/22/08 Pa Environment Digest) In 2007, 277 on-farm projects were funded using that year's allocation. (5/5/08 Pa Environment Digest)