Review of the Literature on the Economics of Central Anaerobic Digesters

Minnesota can improve the utilization of manure and organic wastes via the production of biogas that can be used to produce heat and electricity. Denmark serves as a role model for Minnesota in the number of central anaerobic digesters that it supports. During anaerobic digestion methane is produced when naturally occurring anaerobic bacteria decompose organic matter in the absence of oxygen. This process produces what is called biogas, which usually is a mixture of 55 – 65 percent methane plus carbon dioxide with trace gases such as hydrogen sulfide. Co-generation using manure and other feedstocks can produce more energy than manure alone. Central digesters are more likely to process wastes from food processing plants and other sources resulting in the need for more specialized unloading facilities and larger storage spaces. Digesters can be owned by farmers or consumers cooperatives, third party/non-farming investor(s), state or municipal government, or established as a cooperative or limited liability corporation. Problems associated with centralized digester operation include capital constraints, low profitability, lower-than-expected waste availability, electricity connection and pricing, and waste disposal constraints.