State could help fund manure treatment project

Lee Bergquist
Milwaukee Journal Sentinel
A farmer applies manure to his fields.

Faced with mounting criticism over pollution problems from cow manure, Gov. Scott Walker's administration is turning to a private initiative as a remedy to treat massive quantities of animal waste.

State officials could spend up to $20 million in subsidies for systems to clean up manure and harness the waste as a source of natural gas.

The initiative is chiefly targeting northeastern Wisconsin and the Lake Michigan basin, where concentrated animal feeding operations, or CAFOs, proliferate and the region's fractured bedrock can create conditions allowing manure to percolate through the soil and pollute groundwater. Runoff from manure also has been linked to algae blooms and tainted wells.

Manure pollution has become a growing political issue as the number of large-scale farms have grown from about 50 in 2000 to more than 200 today, according to state figures.

Last week, officials released documents that asked farms and companies for proposals for improved manure management that would, among other goals, keep pathogens from animal waste from being spread on farmland.

The scale of one or more systems could be unprecedented and the cost could approach $100 million in private investment, public documents suggest. The $20 million in subsidies would come from funds paid by utility customers for a state program that encourages energy efficiency and the use of renewable energy.

Depending on the reception from the private sector, the outcome stands to be the biggest initiative by Walker and his administration to address manure and water pollution at a time when state officials are being criticized for not doing enough.

The project is "unlike anything we have done in the past in Wisconsin," Agriculture Secretary Ben Brancel said in a statement.

Yet, as details emerged, there were worries about the speed of the process — officials hope to award subsidies in June. And there have been questions over whether a large-scale project cleaning millions of gallons of manure from multiple sites could create its own set of pollution problems.

"A lot of us have been very vocal about demanding action," said Lee Luft, a member of the Kewaunee County Board. "But we want to be sure that all the questions have been answered when you are talking about something of this scale."

Manure issues are most contentious in Kewaunee County, a leading candidate for a project and where contaminated wells have been reported for years. In December 2015, 34% of wells tested in the county failed to meet health standards for drinking water, according to a study by the U.S. Agricultural Research Service and the University of Wisconsin-Oshkosh.

Details of the plans were unveiled by the Public Service Commission, the Department of Natural Resources, and the Department of Agriculture, Trade and Consumer Protection.

Officials envision private interests to set up consortiums to build and operate hub-and-spoke systems to move liquid manure through a vast network of pipelines from farms to central sites.

A biodigester would take the bacteria from manure to break down organic material and capture methane. Nutrients like phosphorus and nitrogen would be removed and packaged as a fertilizer for later use. And a key feature: wastewater treatment systems commonly used by municipalities to clean polluted water would be installed.

"This is pretty much a full-blown treatment system and that's new territory," said Gordon Stevenson, a retired chief of runoff management at the DNR who continues to track manure issues in Wisconsin.

Only one farm in Wisconsin has an environmental permit to use such a treatment system that can return wastewater to the land, according to the DNR.

The Wisconsin Office of Energy Innovation commissioned a $50,000 study last year concluding that a manure handling system on a massive scale in Kewaunee County was feasible.

The Phoenix Project by Waukesha-based Dynamic Concepts LLC described a system where virtually all of Kewaunee County's manure would be processed at plants using 66 miles of pipes. Biodigesters would help to churn out natural gas equivalent to nearly 350,000 barrels of crude oil.

The cost: $188 million.

Officials believe some aspects of the study will be used in the new initiative.

In Wisconsin, gas from biodigesters is being used to generate electricity. But the price of electricity utilities paid to owners of such systems has dropped.

As an alternative, systems would use methane to produce natural gas, which could bring higher prices, especially when state and federal credits are factored in for producing low-carbon fuel. California, for example, offers low-carbon fuel credits to reduce greenhouse gases.

"What we are trying to do is participate in a private investment to address a public issue," said Bob Seitz, the No. 3 official at the PSC who is moving to the Department of Transportation as deputy secretary.

"The state is doing a good job at priming the pump," said Timothy Baye, a professor of business development/energy finance with the University of Wisconsin Extension. "They are trying to provide an opportunity for a sustainable business practice to address an environmental degradation issue."

But there are worries that an industry-sized manure plant, or multiple plants, could struggle with operational problems such as foul odors or spills.

Authorities in Weld County, in northeastern Colorado, last month shut down a $115 million plant because of odors. The company responded with a lawsuit in federal court.

In Dane County, in the first effort of its kind in the state, a $12 million digester system in Waunakee that gets manure from neighboring farms struggled with problems, including manure spills and a 2014 incident that caused a fire and methane gas explosion. The digester is now under new ownership.

Chilton-based DVO Inc., the largest biogas company in the United States, says it will submit a proposal to Wisconsin officials.

Melissa VanOrnum, vice president of marketing, said biodigesters built by her company can help solve environmental problems, and she cautioned that not all of the technology on the market can achieve the same goals.

"When you hear in the press of these bad apples, it's just painful because the whole industry gets painted with a negative brush," she said. In addition to farms in Wisconsin, the company has sold equipment to a dairy farm in Idaho with 15,000 cattle. "They never make the news," she said.

Another concern: Critics worry that in trying to address manure issues, state officials are essentially offering an incentive for dairy farms to grow bigger.

That's not a good strategy in areas with fractured bedrock and large cattle populations, said Stevenson, the former DNR administrator. He is president of the board of Midwest Environmental Advocates, a public interest law firm that has used the courts to fight large farms.

"There are places in this state where high-impact agricultural activities like CAFOs simply should not be conducted, with or without biogas digesters," Stevenson said.

Last month in Madison at a meeting of the state Natural Resources Board, Luft, the Kewaunee County board member, criticized the DNR for not doing enough to tackle manure problems.

Luft said last week the new initiative could help address manure issues. But he said officials are moving so quickly he worries projects won't be adequately aired in public.

"I don't want to come out as objecting to this," Luft said. "There doesn't seem to be enough time to do a thorough analysis of this."

But the PSC's Seitz said manure contamination "is a big problem and ought to move quickly. The governor wants us to be part of a solution that helps people — and soon."

Thomas Content of the Journal Sentinel staff contributed to this report.