20150701Comment.pdf

AmericanIIcgcis .
Council t1 JL I PH t:L
July 1,2015 ILl IBoardofDirectors
Bernie Sheff Commissioners Kjellander,Raper,and Redford
ES Engineering,Inc.Idaho Public Utilities CommissionChair
472 W.Washington St.
Amy McCrae Kessler Boise,Idaho 83702
Turning Earth,LLC
Vice Chair
Re:DocketsAVU-E-15-01,IPC-E-15-01,PAC-E-15-01
Paul Greene
Natural Systems Utilities,LLC
Vice Chair Dear Commissioners:
Susan Robinson
Waste Management,Inc.The American Biogas Council (ABC)is the Washington,DC-based
$ecretaiv non-profit trade association representing the U.S.anaerobic
Melissa VanOrnum digestion and biogas industry.We represent over 230 companies
DVO,Inc.covering the entire biogas supply chain who are dedicated to
Treastirer (ex officio)...maximizing the production and use of biogas from organic waste.
Patrick Serfass Several of our members are located in or doing business in Idaho
Executive Director (ex officio)and more would like to do business in your state.
Wayne Davis
Harvest Power,Inc On behalf of our members,the ABC submits these comments in
Nora Goldstein response to the Commission’s proposed rulemaking related to
BioCycle shortening the duration of PURPA contracts from 20 years to 5 years
or less,a shortening we oppose.Shortening will essentially stopNormaMcDonald
Organic Waste Systems biogas projects from being able to get financing and therefore will
Mk L
stop project development in a sector that provides Idaho with
Baker Thy MUCH more than just energy.We have serious concerns that the
proposed rule will negatively impact the adoption of anaerobic
Water Environment Federation digesters and nutrient removal technologies in the state of Idaho
especially at dairy farms.Idaho has the 4th largest population of
Amanda Mott dairy cows in the country and only six farm-based digesters whichWisconsinStateEnergyOfficemeansIdahohasasignificantopportunitytobringjobs,investment,
Paul Owen and nutrient management systems to the state through the
Caterpillar Financial Services ..
Corporation construction of new digesters that turn organic materials into
methane-rich biogas,valuable soil products and provide a waste
Paul Relis management solution for many kinds of organics.CR&R Incorporated
Digesters are not just located on farms.We build them at
wastewater treatment facilities,wherever food waste is abundant
and even at landfills to more efficiently process the organics part of
the municipal solid waste stream.Turning those organic materials
into energy is an important part of each system because it’s the
primary way most systems generate revenue,but they also provide
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many important benefits for managing organic materials and nutrients entering the waterway in
ways other technologies cannot.
Digesters and related technology,like the nutrient management systems that can be added on,are
critically important to the dairy industry and help reduce greenhouse gas emissions and nutrient
losses.We must encourage their use,not discourage them.Digesters are very expensive to install
and operate and despite the environmental benefits they produce,they are difficult make work
economically because of the very low prices paid for their products.Selling electricity to the grid at
a fair rate is the primary means by which a digester project can be feasible,limiting that ability by
shortening the length of PURPA contracts will be counterproductive.In addition,since banks ask for
new systems to show certain revenue streams of 10 or mote yeats to obtain financing,shortened
contracts can actually stop a project from being financeable,and therefore restricting an average of
$3 million dollars,25 construction jobs and 2 permanent jobs per project to the state.
This rule,as proposed,is a disincentive to project development and a disincentive to making sure
systems that can manage manure,wastewater biosolids,food waste and other organics are
recycled and managed,not just disposed.If the Public Utility Commission chooses to limit power
purchase agreements (PPA’s)to five years or less,that disincentive will almost certainly end the
adoption of digester technology in Idaho.We do not believe that is in the best interests of the state
of Idaho,its citizens,the wastewater industry,food industry and the dairy and other agricultural
industries in Idaho that can use digesters.
While we recognize that the Commission has imposed an interim five-year limit as noted in the May
8,2015,notice of public meetings for solar and wind projects larger than 100-kilowatts and for all
other renewable projects larger than 10 megawatts while it considers two utility company requests
to cap PPA’s at 2 or 3 years.We also note that in your February 6,2015 order that all qualifying
facility contracts are limited to 5 years.The apparent inconsistency is concerning.In most cases
digesters are designed to generate 1 -5MW,with a select few that could potentially generate up to
10-15 MW.If the May 8th notice is correct,it would appear that most digesters would be
unaffected since they fall in the 100kW-bMW range.If however,the February 6th Order is correct
and dairy digesters PPA’s are capped at 5 years,or less when a final determination is made,you are
in essence banning digesters in your state.
A decision to build and utilize digester technology is risky in many cases and adding uncertainty in
the form of short duration power purchase agreements where there is already risk will spell
disaster.Instead of the approach taken in the proposal,the ABC urges the Commission to retain a
20-year PPA term for anaerobic digesters due to the well-established recognition of the fact that
they deliver enormous environmental benefits and the fact that a 5-year or less PPA will terminate
any and all consideration of their adoption.
The ABC appreciates the opportunity that the Commission has provided for consideration of our
comments.We are pleased to answer any questions you may have or to provide any additional
information which you may require.
Sincerely,
Patrick Serfass,Executive
How biogas Systems Work:http://www.americanbiogascounciI.org/biogas howSystemsWork.asp