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Success Stories: Large Farm Operation in Vermont Converts Manure Into Electricity Sales Revenue

Outline of Need:

Blue Spruce Farm in rural Bridport, Vermont, is family-owned and operated by three brothers (Eugene, Earl and Ernie Audet) who purchased the farm from their parents when they retired. It is a dairy housing and milking operation with 1,200 dairy cows. Due to a milk pricing structure that fails to adequately compensate farmers who produce milk for a living, this farm operation, like many others, showed net income losses annually for the previous three years.

In an effort to sustain their farm business and maximize their revenue potential, the Audets explored diversification opportunities on the farm. Recognizing the energy potential in the farm's abundant manure assets, the farm developed a partnership with their local utility company, CVPS, which fostered the development of “Cow Power” electricity generation on the farm.

How Rural Development Helped:

Determined to construct an anaerobic digester system that would convert dairy manure into electricity, the Audets worked with engineering consultants to design a reliable system and identify the equipment specifications necessary for the project. Collaborative relationships with staff from CVPS, the Vermont Agency of Agriculture, the Biomass Energy Resource Center, VEDA/VT Agricultural Credit, Yankee Farm Credit, and the Department of Agriculture's (USDA) Natural Resources and Conservation Service and USDA Rural Development were critical in developing the plan to design, construct and finance this large-scale project.

The total system costs were estimated at nearly $1 million and included construction of a reception pit, digester with heating and gas mixing systems, and a solids separating and drying building. Several different sources of funds contributed to the total system costs. Rural Development contributed to the electrical generator portion of the system with estimated costs of $389,275. These costs included the electrical generator, with plumbing and service hookups, and a utility building for the generator. Lyn Millhiser, one of Rural Development's Business and Cooperative Programs Specialists, facilitated a grant application (learn more about this program) and award for 25 percent of the electrical generator portion of the project, for a total of $97,318.

The Results:

The system has been constructed on schedule and the farm began sales of electricity to CVPS in December 2004 at a price agreed to be wholesale value plus a consumer premium. Electrical generation projections are estimated at nearly 2,000,000 kWHr annually, for a projected annual net revenue to the farm of $155,604. There is additional profit potential of nearly $53,000 annually from Carbon Credits and Tax Credit savings.

(January 2005)




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