State’s farmers feel left out of big clean energy programs

Woodstock — Paul Miller has two words for the watery cow manure being pumped from catch basins under his barns into a large tanker truck — and those words, surprisingly, are not “that stinks!”

The words are: “liquid gold.”

For the record, the manure does stink, and by all accounts would be even worse if the temperature wasn’t in the low teens this frigid morning. But stinky or not, the manure, which each of Miller’s 1,600 cows produces to the tune of 100 pounds a day, does indeed have the potential to be liquid gold as a way to pay his farm’s $150,000-a-year electric bill.

And then some.

Fairvue Farms owner Paul Miller has been trying to get an anaerobic digester for his Woodstock dairy farm for 10 years. (Photos by Jan Ellen Spiegel)

The problem for Miller, whose Fairvue Farms in the state’s northeast corner is one of the dairies in the Farmer’s Cow cooperative, is that state laws and regulations don’t make the economics of his manure-to-electricity plan work.

What Miller wants to do is install an anaerobic digester. This would essentially decompose the manure, and/or other organic waste such as food, in a closed container that largely eliminates the nasty odor that comes from two gases the manure releases, ammonia and methane.

The digester turns the gases into electricity and heat. What remains in the digester is a non-smelly residue that can be used for fertilizer. Miller currently uses his manure for fertilizer, though in a much more malodorous form.

The anaerobic digester Miller has been trying to put in place for the better part of 10 years would make 20 to 40 times the 50 kilowatts of electricity he needs.

“We would like the possibility of doing a community digester where neighboring farms would bring the manure in, digest it, and then in turn we would bring the manure back to them and spread it on their fields,” he said.

Miller also wants to credit them with electricity.

It’s a concept called virtual net metering. Net metering allows a home or business with an alternative power source, like solar panels, to pay the difference between the electricity generated and what’s used from the grid — as measured through a single meter.

Virtual net metering allows an energy producer like Miller, with a power source bigger than he needs, to credit the extra power to additional meters on the property — Miller has five — or to other businesses, say another farm providing manure for the digester or a grocery store that might provide it with food waste.

But the laws in Connecticut allow only municipalities to do that. Miller would have to sell his excess power back to the grid at a very low wholesale rate — about 3.5 cents a kilowatt.

Bill Rees of Green Power Solutions, who’s been trying to pull together Miller’s project — estimated at $3 million — said he can’t get investors at that price because the payback would take too long.

“The investors that we have that are sitting on the sidelines watching this project progress have really laid it out that they need to have some risk taken out of a project like this,” he said.

Fourteen cents a kilowatt would be tough, he said. “I think I’d have investors look twice at it, but maybe not the third time.

“If I got 16 (cents), I’m pretty sure I could make it work.”

New bill proposed

State officials and legislators are aware of the problem. Language that would have allowed limited virtual net metering on farms was in legislation last session. But it was taken out of the final bill, which died anyway. Rees and Miller said the utilities had fought the provision.

“What we have found is that the utilities will fight us to the end,” Rees said.

Miller added: “They have more numbers screaming than we do.”

Utilities own the transmission lines that would be used as part of virtual net metering. Legislation would be required to allow that to happen.

“New rules regarding distribution lines would have to be created for all of Connecticut’s electric utilities,” said Connecticut Light and Power spokesman Mitch Gross in an email. “And these would require state regulatory approval.”

This year there’s language in legislation submitted by Gov. Dannel Malloy to implement parts of the state’s new Comprehensive Energy Strategy. It would allow farms to use virtual net metering and partner in an anaerobic digester. But if they wanted to include the food waste from a grocery store or a hospital, those businesses could not get electricity in return. Nor would they be allowed to do one of the things Fairvue was hoping — sell electricity to a neighboring business, namely Crabtree & Evelyn, with corporate, manufacturing and distribution facilities nearby.

“There’s a disconnect between what the legislators think they’re putting together,” Rees said. “And what comes out the back side.”

No pun intended.

Fairvue Farms Holsteins in the milking barn, and producing their ‘liquid gold.’

“We wanted to put forth language in the Comprehensive Energy Strategy to make anaerobic digestion more available and more feasible,” said Paul Mounds, the director of governmental relations in the governor’s office, who also said he’d be happy to sit down with farmers. “We want to get the solutions to why they can’t move forward with anaerobic digestion or any energy processes for their farms.”

What Miller and other farmers would like is a program similar to one in Massachusetts. Virtual net metering is allowed for farms. They receive the retail price based on whatever it is at each facility involved. And non-farm operations can be full partners in energy projects such as anaerobic digesters.

The lack of virtual net metering at a useful price, however, is not the only thing Connecticut farmers say has kept them from benefiting from large clean energy projects.

State energy program didn’t include digesters

Anaerobic digesters were not included in the re-invention of the state’s commercial clean energy incentive program approved two years ago. The program caters largely to solar, wind and fuel cell projects.

The Clean Energy Finance and Investment Authority, CEFIA, was mandated to establish an anaerobic digester pilot project. But the first request for proposals late last year resulted in precisely zero applicants. The program was revised, a new RFP issued with an early February deadline. It had one applicant — not a farm.

“Speaking specifically to the hang-ups with the virtual net metering policy and farmers, I think part of our effort is to continue to gather information,” said CEFIA spokesman David Goldberg. “And better understand what we might be able to do as a financing deployment authority to help these farmers who would like to take advantage of anaerobic digestion, figure out how we best can do this.”

He admitted virtual net metering would help.

The Connecticut Farm Energy program, which operates through the U.S. Department of Agriculture, started in 2009 and has been run since then by Amanda Fargo-Johnson. Much of the program focuses on energy efficiency measures farmers can take to cut costs and assistance with grants and loans to fund them. Fargo-Johnson also helps farms with higher-end clean energy projects, and in doing so, she has noticed several hurdles.

For new farmers or farmers putting up new structures, federal incentives are generally unavailable. “Those programs are really geared to help farms already in business and fixing a problem,” she said.

While she agrees with others that lack of virtual net metering is a huge obstacle, she has other suggestions. “I think we could get some set aside state funds that could help match up with federal funds,” she said. “That would also be a good catalyst for farms to get going on projects.”

Fargo-Johnson also said farms could play a major role in helping the state meet its renewable energy goals. “They have land and they have the space and in some cases they’re looking for the additional income,” she said. “But the way the structure of things is now, it’s not attractive for them to participate.”

Other farms would benefit

While Fairvue Farms has become the poster child for farm energy reform in Connecticut, Miller is not the only farmer who has had to delay a project, mainly because of the virtual net metering conundrum.

In East Canaan, in Litchfield County, Laurel Brook Farm, a dairy farm with about 2,000 cows, owner Bob Jacquier has been thinking about a community digester project for years. He alone has 13 meters.

So for now he can only make compost — no electricity — from his manure and kitchen waste from two nearby private schools — which he sells. “The biggest problem we have is the economics didn’t work without having net metering,” he said. “We would have to stick our neck out and put $2 to $3 million into one of these as capital and there would be no guarantee on a return.”

But if virtual net metering goes through, he would reconsider.

“Oh for sure,” he said. “If there’s some kind of a program out there that we can utilize and get a decent price for everything that we can make — sure.”

Keith Bishop of Bishop’s Orchard said he’d also reconsider his shelved idea for wind turbines on his family’s Guilford farm if virtual net metering for farms is allowed. “I’ll definitely take a look at it,” he said.

In the meantime, Paul Miller says he’ll keep pumping out the manure and spreading the smelly version (“You get used to it,” he said) on fields. But he’ll also keep making a stink in Hartford.

“We’ve had discussions with the Department of Energy and Environmental Protection. We’ve had discussions with the Department of Ag. We’ve had discussions with the governor. We’ve had discussions with key people in the legislature,” he said.

“Everybody says it’s a super idea, but we’re not sure why we can’t get the pieces together to make it work.”