UNLOCKING BIOFERTILIZER AS ADDITIONAL REVENUE SOURCE When considering opportunities to produce and sell digestate, there are legal Issues for renewable natural gas project developers to consider. BY CHRIS PETERSON
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lobal supply chain disruptions continue to wreak havoc on the price of conventional chemical fertilizers, including the raw materials used for fertilizer production such as ammonia, nitrogen, nitrates, phosphates, potash and sulphates. The ongoing Russia-Ukraine conflict has exacerbated matters, driving prices up even further. It is no wonder farmers are looking beyond traditional sources to fertilize crops. Such alternatives include biofertilizers, like those produced from the digestate byproduct left over from the anaerobic digestion of livestock waste and other organic materials. The market for biofertilizer is expected to nearly double over the next decade, reaching over $4 billion in total revenues on a compound annual growth rate ranging from 11 to 15% For developers of renewable natural gas (RNG) projects, demand for digestate may be another source of revenue, as long as the rights to the digestate are clearly defined in
the developers’ agreement with the feedstock suppliers. Biofertilizers are substances containing micro-organisms that add nutrients to crops through nitrogen and Peterson phosphorus fixation, and assist in restoring the soil’s natural nutrient cycle. Biofertilizers are also more climate friendly, as their use reduces greenhouse gas emissions. Use of biofertilizers such as those produced from livestock waste digestate may also provide farmers with additional revenue from the generation and sale of carbon credits.
Voluntary Carbon Markets for Farmers
With large corporations seeking to reduce their carbon footprints and achieve net zero carbon emissions, demand has increased for carbon credits that allow such corpora-
tions to offset some of their emissions. Each carbon credit represents one ton of CO2 that was not released into the atmosphere. Farmers can generate these carbon credits by voluntarily participating in a carbon market and by instituting certain approved farming practices to reduce the farm’s carbon emissions. These practices may include planting cover crops, reducing tillage to increase the amount of carbon stored in the soil, and substituting synthetic fertilizers with organic matter soil amendments to reduce volatility and nitrous oxide emissions. Some of the voluntary carbon markets currently available to farmers include Indigo Carbon, Gradable Carbon, Nori Carbon Removal Marketplace, Nutrien Carbon Program and TruCarbon. Each market has specific requirements for farmers to generate a carbon credit. Once the credit is generated under the terms of the specific carbon market, the farmer is able to sell the credit. Understanding the voluntary carbon market may assist biofertilizer producers in
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28 BIOMASS MAGAZINE | ISSUE 3, 2022
