PENNVEST OKs $7.8 M for Kreider Farms Dairy Project
Bion Environmental Technologies, Inc. on Jan. 28 announced that the Pennsylvania Infrastructure Investment Authority (PENNVEST) approved a $7.8 million loan to Bion PA 1, LLC (a wholly-owned subsidiary of Bion Environmental Technologies, Inc.).
Proceeds from the loan will be used to construct Bion's previously announced Kreider Farms dairy project in Lancaster County, Pa. The company will construct a livestock waste treatment facility at Kreider Farms that will reduce both nitrogen and phosphorous emissions to the Chesapeake Bay watershed. The project is expected to generate a significant number of tradable nutrient credits that could be sold to other entities within the Chesapeake Bay watershed to help them comply with their own discharge limits for nitrogen and phosphorous.
This is the first project approved by the PENNVEST Board that supports waste treatment infrastructure at a confined animal feeding operation for the purpose of generating nutrient credits. Based on this approval, Bion will move forward with engineering and permitting for the Kreider project while finalizing definitive agreements with PENNVEST.
Over the past two years, Bion has worked with the Pennsylvania Department of Environmental Protection and representatives from Pennsylvania State University to establish an acceptable nutrient credit calculation and verification methodology for the Kreider Farm project, which was approved by the DEP in mid-2008. The DEP approval projects a credit total in the range of 140 nutrient credits per milk cow's waste treated; and perhaps most significantly, a majority of these credits will be generated from airborne ammonia reductions. Ammonia air emissions are, for the most part, quickly re-deposited onto neighboring lands, which simply advances the nitrogen molecule's travels toward the Chesapeake Bay.
The treatment system also will reduce odor, phosphorus releases to local creeks, a host of air emissions such as hydrogen sulfide and methane, as well as pathogens.
More than 40 states have announced plans to develop nutrient trading programs, with Pennsylvania's program being the most advanced. Nutrient trading programs encourage nitrogen and phosphorous reductions from non-point source facilities (such as agriculture and livestock facilities) by providing a program to sell credits for those reductions. These certified nutrient credits can be used by point source facilities such as municipal wastewater treatment plants, with much higher remediation costs, to offset their own nutrient discharges. The premise is that the same nutrient reduction to the environment can be achieved at a significantly reduced cost to the community.
The results of a recent study commissioned by the Pennsylvania state legislature projects an average nutrient removal cost of $28 per pound of nutrient per year to upgrade existing wastewater plants. Bion anticipates that it will be able to reduce that projected cost by as much as 75 percent, based upon its models and anticipated policy modifications. Kreider Farms will be the first comprehensive on-farm waste treatment plant installation in the state, generating a steady stream of more than 100,000 credits per year.
The company is working on a second phase of the project that it believes will generate in excess of 1 million additional credits. Phase 2 is anticipated to include a renewable energy production facility that will convert cellulose in the waste stream into usable thermal energy.
According to the Chesapeake Bay Tributary Strategy, Pennsylvania's municipal wastewater treatment plants that ultimately discharge into the Susquehanna River watershed are required to reduce or offset their nutrient discharges by 7.5 million pounds per year.