TABLE OF CONTENTS
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INTRODUCTION PAGE |1
Fueling a vehicle with food waste was a concept made famous by the movie Back to the Future in the 1980s. Now, almost 30 years later, what was once a futuristic idea has become a reality. Biogas, also known as renewable natural gas (RNG), produced at locations such as landfills or dairy farms, can supply gas to onsite fueling infrastructure for vehicles such as refuse haulers and dairy trucks. There are equipment costs associated with refining RNG for use as vehicle fuel. Once the RNG has been refined, equipment and installation costs for a fueling station using RNG are similar to those for a fueling station that is connected to a utility pipeline. The use of landfill gas as a vehicle fuel is becoming more common as organizations seek to cut their greenhouse gas emissions and take advantage of the availability and sale of renewable energy. In July 2014, the EPA finalized the Renewable Fuel Pathways II Final Rule to identify additional fuel pathways under the Renewable Fuel Standard (RFS) Program.
WHAT IS LANDFILL BIOGAS? Landfills produce gases as a result of chemical reactions (anaerobic digestion) and of microbes acting upon the waste as it breaks down. The gas is mostly methane and carbon dioxide. Both are greenhouse gases believed to contribute to global warming, so capturing these gases and using them for fuel is environmentally friendly. In fact, methane from a municipal solid waste landfill is a 90% reduction in GHG emissions compared to gasoline or diesel.
WHAT’S DRIVING THE CURRENT INTEREST IN BIOGAS FOR VEHICLE FUEL? Many states, cities and other jurisdictions in North America have recently adopted or are phasing in mandates to divert more than 70% of their municipal solid waste from landfill disposal. Recycling traditional recyclables can only get the diversion rate to 50% or so. The new mandates for more diversion create a need to focus on organic waste (yard waste and food waste) which accounts for more than 25% of the waste stream and is still largely unrecycled in North America. One of the options for recycling organics is anaerobic digestion, which is the process that produces biogas. Biogas is just over half methane, which can be extracted, cleaned up and turned into renewable natural gas (RNG) which, when compressed, becomes a usable vehicle fuel - compressed natural gas (CNG). While biogas can be used for other purposes, including generating electricity, our project-specific economic analyses to date indicate that conversion to CNG vehicle fuel is usually the highest return option for using biogas. Other important drivers of the biogas-to-vehicle fuel trend: - Incentives for renewable energy - Greenhouse gas reduction mandates and incentives - Decreasing costs for CNG systems, as it becomes more widely adopted
RENEWABLE ENERGY AND GREENHOUSE GAS (GHG) REDUCTION INCENTIVES Since biogas is not a fossil fuel, or derived from fossil fuels, it displaces fossil fuels when used as a fuel. Biogas projects are therefore eligible for the many grants, loans, and incentives available to reduce GHGs. While the United States federal government has struggled to implement regulations and incentives for GHG reduction, many PAGE |2
states, Canadian provinces and independent foundations and agencies have made incentives available that can make a significant difference in the economics of biogas projects. Additional incentives are available in many locations for renewable energy, for which biogas usually qualifies. These incentives too vary greatly with geography. Most biogas projects coming on line today benefit from one or more of these programs.
ECONOMICS OF CNG CONVERSION The price of natural gas remains low relative to other fuel resources, as a result of the use of horizontal drilling, fracking, and other new extraction techniques producing abundant supplies. This has caused many truck fleet owners to begin converting large parts of their fleets to CNG-fueled vehicles. The demand for CNG compression and fueling systems has grown in tandem with this trend, which has not only reduced the price of these systems, but has brought modular systems into the market place that provide greater reliability and cost certainty than in the past. All of these factors add up to define the economics of biogas-to-energy projects. Others are driving dairy and other livestock farmers to digest their manure, producing various products that can be used on the farm (animal bedding and fertilizer from the digestate) as well as biogas. Still others are driving an increasing number of wastewater treatment plants to design new and modify existing digesters to accept feedstocks such as food wastes and fats, oils and grease in addition to treating the sewage sludges. What we’ve found in analyzing proposed projects is that, given the variety of factors that can affect any given project, it’s necessary to carefully examine all potential inputs and outputs, project by project, to determine the optimal combination of feedstocks and outputs in evaluating economic viability. Indeed, several entrepreneurial merchant facilities have sprung up that combine all of the above feedstocks in the same digester and produce a variety of products, including CNG produced from biogas. According to a 2014 USDA study, there are today operating in the United States over 2,000 biogas production facilities of all types, and there is adequate feedstock to expand that number to 13,000 facilities that could generate just over 650 billion cubic feet per year of biogas that could produce the equivalent of 2.5 billion gallons of gasoline per year.1
SEPARATING AND COLLECTING THE WASTE FEEDSTOCKS Waste materials that are the best candidates for biogas production are referred to in the waste industry as sourceseparated organics, or SSO. These include wastes collected in municipal programs that require households and businesses to separate organic waste to meet the landfill diversion mandates discussed above, and customers are provided with separate carts for collection of strictly organic waste. While only a few of these have been implemented, several important jurisdictions, including the states of California and Massachusetts and the cities of Seattle, New York, San Francisco, Toronto and Calgary have or are in the process of implementing requirements for businesses and/or residences to source-separate their organic wastes. Meanwhile, waste haulers in a number of locations have set up separate routes for collecting SSO from businesses, and fat, oil, and grease (FOG) collection has become well established to the point that in many locations the FOG tanks must be locked because the contents are subject to theft – a sure sign of a valuable commodity!
ANAEROBIC DIGESTERS ARE USED TO PRODUCE BIOGAS 1 USDA, Biogas Opportunities Roadmap, August 2014. PAGE |3
Unlike natural gas, which is extracted from reservoirs trapped in rocks under pressure deep in the earth, all biogas is produced by microscopic living organisms. They are specialized bacteria that thrive only in airless environments (oxygen is toxic to them), and thus the process is known as anaerobic digestion. Cows do this in their airless stomachs, using the bacteria to digest things other animals cannot. Managing a digester tank is just a matter of keeping the bacteria happy, which cows do naturally. It’s harder for us, and requires frequent or constant testing and control of many parameters including pH, solids content, temperature and flow rates, among others. Anaerobic digester technology is currently in a state of rapid development. There is a range of digester types, and, this is an important point, some work better for some feedstocks than for others. In general, the digester types are grouped according to how wet the feedstocks are. Wet digesters are basically big tanks where very wet feedstocks (solids content less than 20%) are pumped in and pumped out. So-called “dry” digesters handle materials that are stackable (greater than 40% solids), and the material is loaded in and out with a front-end loader. In “dry” digesters, liquids are percolated through the organic material rather than submerging or suspending them. In between are high-solids digesters that handle slurries of between 20% and 40% solids. It’s important to select the right type of digester for the feedstocks available. Dry digesters are potentially much more efficient, requiring less heat and energy input and producing much less wastewater, but are only good for drier feedstocks. Feedstocks ultimately drive everything in digestion and biogas production.
HOW IS BIOGAS TURNED INTO CNG? In order to use biogas as vehicle fuel, it’s got to be cleaned up. It’s important to understand that treatment for vehicle fuel use doesn’t have to be cleaned up to the same standards as for pipeline injection. Standards for CNG include SAE J1616 and California Code of Regulations Title 3, Article 3 - Specifications for Alternative Motor Vehicle Fuels. While pipeline companies may require biogas to be cleaned up to 98% or higher methane concentration,
the California CNG standard only requires 88% methane, and vehicles can generally be operated efficiently at this methane content. This can make a large difference in the costs needed to cleanup and treat the gas to use it for fuel. Typically, removal or reduction of moisture, carbon dioxide, hydrogen sulfide, VOCs, and siloxanes are required for vehicle use of biogas. Dry Digester
Wet Digester
Compression and Storage Biogas is typically compressed in two stages, typically by reciprocating compressors. The initial compression may be up to an intermediate pressure of 500 psig for processing. Final compression would be up to the CNG fuel PAGE |4
storage pressure of 3,600 psig. 300 SCFM of biogas yields about 100 SCFM of CNG, which equals approximately 1,000 gallons of gasoline equivalent per day. CNG is stored in high pressure vessels. The vessels can be spherical, or long and tubular vessels that can be mounted on a trailer for transportation (see photos below).
DISPENSING – IT’S NOT USEFUL UNTIL IT’S IN YOUR TANK For a fast fill refueling facility CNG is stored in a series of vessels at 3,600 psig. The vessels are emptied sequentially during vehicle refueling until the vehicle tank reaches 3,000 psig. The fuel dispenser may look similar to a conventional gasoline pump with two fill hoses and a fuel meter.
HOW MUCH CNG CAN YOU GET FROM ORGANIC WASTE (MILES PER BANANA PEEL)? Biogas yields for different feedstocks vary greatly. Even within a given type, various sources report a range of typical values. Rules of thumb for use in preliminary alternatives comparisons are listed below in Table 1, covering the range from high to low.
TABLE 1 - BIOGAS AND CNG YIELDS Type of Organic Waste
Ft3 biogas per ton of SSO as received
Ft3 CNG per ton of SSO as received
Gasoline Gallon Equivalent per ton
Fats, Oils, (FOG)
16,000 or more
6,400 or more
55 or more
Food waste (restaurant or grocery store)
2,900 to 4,200
1,200 to 2,400
10 to 20
Cow manure
800 to 1,600
300 to 900
2.7 to 8
and Grease
For project engineering and budgeting, tests should be made on samples of the actual feedstocks that will be delivered. A standard test called the biomethane potential (BMP) test is done in a laboratory mini-digester, and factored down to adjust for non-laboratory conditions.
CONVERTING BIOGAS TO GGE AND DGE - ENERGY VALUE OF CNG PRODUCED FROM BIOGAS As mentioned earlier, carbon dioxide, moisture and impurities a need to be removed to protect vehicle engines. This takes energy, and can consume as much as a third of the biogas produced for very small systems (on the order of 5,000 cubic feet per hour of biogas), and only a few percent for larger systems (20,000 cubic feet per hour of biogas and larger). These reductions and the resulting volume reduction for removal of carbon dioxide give the ranges CNG yields listed in Table 1, as well as gallons of diesel fuel equivalent.
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COSTS AND BENEFITS OF A BIOGAS-TO-CNG PROJECT The cost of biogas production can vary from $0.60/Gasoline Gallon Equivalent (GGE) to $1.00/GGE. A GGE equals about 5.66 pounds of CNG. However, keep in mind that digestion project costs are usually offset by other revenues, including tipping fees for accepting the organic wastes, and digestate that can be used as fertilizer. For this reason, every project must be analyzed based on its own circumstances.
ENVIRONMENTAL BENEFITS BioCNG is a clean, domestically produced alternative fuel. In addition, compared with vehicles fueled by conventional diesel and gasoline, CNG vehicles can produce lower levels of some emissions. And because CNG fuel systems are completely sealed, CNG vehicles produce no evaporative emissions.
UNDERSTANDING THE WHOLE PLANT AND INCLUDE ALL COSTS AND BENEFITS The total cost of developing a CNG fueling station depends on a number of factors, including the fuel demand from the fleet and other users, the fleet's applications and duty cycles, site conditions, the complexity of equipment installation, and local permitting processes. As a result, costs can vary widely from one project to another.
PROJECT DEVELOPMENT COSTS The estimated cost ranges for various sizes and types of CNG fueling stations and a variety of factors contribute to the total cost of a completed fueling station. The most significant costs associated with developing a station are those related to land, engineering drawings, station design, equipment, and construction. The actual costs of a given project will vary according to the specific needs and constraints of the fueling station and its users. The available gas pressure (inlet pressure) in the supply gas line can have a significant impact (positive or negative) on fueling station costs as well. If a site has low gas pressure in the gas line, additional compression and/or higher horsepower may be needed, which will increase capital and operating costs. The site location and preparation needed for the CNG station will have a significant effect on the overall development cost. Land costs vary based on many factors, such as location and size. Prior to installing CNG fueling equipment, general site work may be needed, such as grading, filling, compacting, paving, and stormwater management. Increased project costs may result from project management challenges, such as supplier reliability, expediting equipment delivery or installation, or regional labor costs.
CAPITAL AND OPERATING COSTS Operational costs such as electricity, insurance, and accounting software should be taken into consideration and accounted for in the fuel price. Electricity charges include consumption and demand charges, which vary across the country. The accounting system processes fuel purchases and ensures that relevant federal, state, and motor vehicle sales taxes are applied. It is important to note that a maintenance contract is critical for the long-term performance of a station. Minor preventive maintenance is scheduled on a regular basis, along with periodic major maintenance activities. PAGE |6
The tables below provide estimated cost ranges for a Large Fast-Fill CNG station. These estimates include the costs of engineering, equipment, and installation at a site with the specified assumptions. The estimates do not include costs associated with unusually complicated installations, difficult permitting issues, compressor redundancy, or factors that could increase the total project cost.
TABLE 2 - LARGE STATION (1,500–2,000 GGE*/DAY) COST E STIMATE Type Fast-Fill
Cost Range $1.2–$1.8 million
Example Applications Assumptions • Large retail station serving light- to • Two 300–400 scfm (143–190 gge/hr) heavy-duty vehicles such as delivery compressors vans, work trucks, refuse trucks, class • Minimum 30 psi inlet gas pressure 8 tractors, and local fleets, or • 46,000scf storage (121 gge useable) • Airport station serving light- and • Two dual-hose metered dispensers w/ fuel medium-duty vehicles such as taxis, management terminals shuttle buses, and local fleets** • Included civil & installation costs are estimated at ~ 50% of equipment costs
*1 gge (gasoline gallon equivalent) = 126 scf (standard cubic feet) **A time-fill station can accommodate more vehicles than hoses if the vehicles do not fuel every day.
EQUIPMENT COSTS Actual equipment costs vary based on equipment size, specifications, and manufacturer.
TABLE 3 – LARGE STATION EQUIPMENT COSTS Equipment Compressor -performance • 1–8 scfm (1–4 gge/hr) • 20–40 scfm (10–19 gge/hr) • 50–75 scfm (24–36 gge/hr) • 100–150 scfm (48– 71 gge/hr) • 250–650 scfm (119–310 gge/hr) Fast-fill Dispenser
Dual-hose time-fill post
Cost Range $4,000–$550,000 $4,000–$22,000 $35,000–$90,000 $70,000–$150,000 $100,000–$250,000
Description The compressor takes inlet gas at low pressure and compresses it to the pressure necessary for filling a vehicle to 3,600 psi. The compressor’s horsepower (HP) rating and the inlet pressure (psi) determine the flow rate, which is measured in standard cubic feet per minute (scfm) or gasoline gallon equivalent per hour (gge/hr). Compressors that offer similar flow rates vary in price based on their horsepower rating and manufacturer. Compressor performance will vary widely, depending on inlet pressure.
$200,000–$550,000 $30,000-$55,000
$4,000–$6,000
At fast-fill stations, drivers use a dispenser to quickly transfer CNG to the vehicle tank. Dispensers vary in cost depending on the number of hoses, fuel management system, and line sizes. At time-fill stations, vehicles are connected to a simple fill post, typically overnight. The tanks are filled as fuel is available, which depends on the compressor flow rate and the number of vehicles. Two vehicles can connect to a dual-hose time-fill post. PAGE |7
$95,000–$110,000 Storage vessel (per 3-pack of 11,600 SCF) Card reader/fuel management
$10,000–$15,000
System per island Gas dryer
$18,000–$225,000
Once natural gas is compressed, it can be stored in vessels for later use. The storage capacity and compressor size are balanced to ensure that fuel is available within the necessary timeframe and the number of times the compressor turns off and on is minimized. Card readers allow the driver to access fuel using a fleet card or credit card. A fuel management system is software that enables tracking of driver and vehicle fueling habits. Can be tied into existing fleet or retail fuel-management system A gas dryer removes moisture from the gas prior to compression, which is a good practice for all CNG stations.
Cost estimates validated by Fuel Solutions, Inc. Unless otherwise noted, the estimates for fast-fill stations assume a vehicle fueling window in which 70% of the fuel is dispensed during two hours in the morning and two hours in the afternoon. For time-fill stations, the compressor is assumed to run for 10 hours per day. Fast-fill cost estimates for the small, medium, and large stations include a priority panel and credit card reader. All scenarios include a gas dryer. It is important to note that the cost of a CNG station may vary substantially from the estimates listed here. Contact a CNG equipment supplier or engineer who specializes in CNG station design to determine the appropriate design and cost for a specific application. Source: DOE & National Renewable Energy Laboratory National Renewable Energy Laboratory.
RENEWABLE ENERGY INCENTIVES To accelerate use of fuels derived from renewable sources, Congress established standards under the Energy Policy Act of 2005 designed to encourage the blending of renewable fuels into our nation’s motor vehicle fuel supply. This initial renewable fuels standard (RFS, referred to as RFS#1) mandated that a minimum of 4 billion gallons be used by 2006, rising to 7.5 billion gallons in 2012. Congress strengthened the renewable fuels program under the Energy Independence and Security Act of 2007 (RFS#2) to include specific annual volume standards for total renewable fuel and also for specific renewable fuel categories of cellulosic biofuel, biomass-based diesel and advanced biofuel. This Act also greatly expanded the biofuel mandate and extended the date through 2022. RFS#2 mandates that fuel refiners obtain renewable fuel credits to meet a minimum percentage of renewable fuel production. The renewable fuel credits are called Renewable Identification Numbers (RINs) and represent 77,000 BTUs of fuel (Approx. 13 RINs per MMBTU). CNG produced from landfill gas qualifies for RINs. Recent prices have been in the range of $0.80 to $1.00 per RIN, which equates to $10 to $13 per MMBTU.
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Source: EcoEngineers (2014)
PROJECT DEVELOPMENT – COMPLEX AND NOVEL PROJECTS Biogas projects are inevitably complex because there are multiple inputs and multiple outputs. Feedstocks will probably come from multiple sources, and these supplies need to be assured through various forms of agreement with the generators. The big plus here is that unlike in most energy projects, a biogas project owner actually gets paid to take the fuel, which is considered a waste for which the generator expects to pay for disposal. In addition to energy from biogas, there is usually at least one more revenue source from products of digestion, which can often be sold for fertilizer value or can be composted to produce saleable products. The multiple revenue sources provide robustness because market fluctuations for one won’t affect the others. But the complexity, as well as the relative lack of precedents, make careful planning and supplier commitments essential for these projects.
SELECTING THE RIGHT TECHNOLOGY As noted earlier, anaerobic digestion technology is in a state of rapid development. This is because of the wider array of feedstocks that are now being considered for biogas production. Many technology vendors are making claims that, however valid, have little field experience to back them up. And choice of the optimal technology based on the feedstocks that will be used is essential to making a biogas project successful. Every biogas project today should include check-ins on the latest available technologies and data available from vendors, and compare not only data for that technology, but how its effects will ripple through the whole project, from requirements for feedstock collection and pre-processing through production, distribution and sale of all products that will result from the project.
CASE STUDIES CITY OF TACOMA , WASHINGTON PAGE |9
In 2012, the City of Tacoma began evaluating different options for collection and processing source separated organics, in addition to the yard waste collection and composting program that it has provided to citizens for years. The evaluation began with characterization of the feedstocks that could be collected in the city. The City decided to focus on commercial sources (stores, food processors, restaurants, etc) rather than contemplating a separate program for residential SSO (in addition to the yard waste program), as other cities have done. The results of several surveys of businesses in the city and a pilot collection program indicated that approximately 3,300 tons per year of SSO suitable for producing biogas could be collected. Note that this was a very thorough bottom-up study of what could actually be collected, rather than what might be generated based on the type of business and other readily available data. The City then proceeded to evaluate the best alternatives for processing the SSO, which included several methods of anaerobic digestion and composting by combining with yard waste. The City did not assume it would produce biogas, but also evaluated composting as an alternative. Concept designs and life-cycle costs and revenues were prepared for all the alternatives, including operating costs over the project lifetime. Revenues included fuel cost displacement for the City’s refuse trucks, which, appropriately, would be fueled by the resulting CNG. Costs included all capital costs, including not only the digesters and biogas-to-CNG conversion, but also the costs for 50 new CNG-fueled trucks. Environmental and social factors were also considered in a “triple-bottom line” analysis. The conclusion was that co-digestion with the City’s sewage sludge, using excess digester capacity available in the City’s wastewater treatment plant, would be the most beneficial method for processing the commercial organics, and would result in a net-zero economic result for the City. Similar co-digestion systems have been implemented in several cities across North America, using excess sewage sludge digester capacity. This approach requires preprocessing the SSO materials so they can be mixed with the sewage sludge without creating upsets in the digester. The next step in this program is a co-digestion pilot study, currently under way, in which pre-processed SSO is added to the digesters.
CITY OF SACRAMENTO, CALIFORNIA Food waste in Sacramento is being converted to CNG with the help of a high-solids anaerobic digestion system. The Organic Waste Recycling Facility at the South Area Transfer Station (SATS) in Sacramento, Calif., began accepting 25 tons of food waste per day in December 2012, collected by Atlas Disposal Industries from area food processing companies, restaurants and supermarkets. Through anaerobic digestion (AD), the food waste is converted into renewable natural gas, electricity and heat, with material remaining from the process being turned into fertilizer and soil amendments. Clean World Partners, Gold River, Calif., broke ground on an expansion of the facility in June, allowing the facility to accept 100 tons per day of food waste. Atlas Disposal has opened California’s first AD-based renewable natural gas fueling station, which uses natural gas produced at the recycling facility to fuel the company’s fleet as well as other area vehicles running on compressed natural gas (CNG). Currently CNG powers 25 percent of Atlas Disposal’s vehicles. Once the expansion is complete, the Sacramento biodigester is expected to produce 700,000 gallons per year of renewable CNG. Atlas calls the fuel it produces ReFuel and describes it as a carbon-neutral fuel that is chemically identical to fossil natural gas and 100 percent compatible with existing CNG combustion systems. The system is expected to reduce greenhouse gas emissions by 5,800 tons per year. In addition to the ReFuel, the Clean World facility will produce 8 million gallons per year of organic soils and fertilizer products and will generate 1 million kilowatts of electricity that will power the facility and fueling station.
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The expansion is expected to be complete in December, Atlas Disposal says. At 100 tons per day, nearly 40,000 tons of organic waste will be converted to vehicle fuel. For every 2 tons of food waste, the biodigester produces 50 diesel gallon equivalents of CNG. When BioCNG expands its upgrading system to accommodate the increased material intake, it will be able to produce 1,500 diesel gallon equivalents per day from the digester biogas produced. According to Atlas, ReFuel will cost about $2.25 per gallon compared with traditional diesel, which sells for $3.80 per gallon. While BioCNG’s units have been employed at several landfills in the Midwest, the Sacramento biodigester is the first project for the company using an organic food waste digester. Fenn says he sees quite a bit of potential from AD gas. “Typically an anaerobic digester is 60 percent methane. A landfill is in the low to mid 50 percent range,” he says. “You get more product fuel [from AD] because it has a higher methane content.” Source: Renewable Energy from Waste Magazine
ADDITIONAL RESOURCES For more information about CNG stations, visit afdc.energy.gov/fuels/natural_gas_cng_stations.html.
the Alternative Fuels Data Center
(AFDC) at
Questions or comments about the information in this article can be sent to bwallace@wihresourcegroup.com
ABOUT THE AUTHORS Bob Wallace, MBA is the Founder and a Principal of WIH Resource Group, Inc. and has over 27 years of experience in waste and recycling collections programs management, transportation / logistics operations, alternative fuels (CNG, LPG, LNG & biodiesel), Fleet Management, Operational Performance Assessments (OPAs), Waste-by-Rail programs, recycling / solid waste operations, transfer stations, landfills, planning and development. Mr. Wallace has extensive experience in working with clients in both the private and public sectors. Prior to WIH Resource Group, Mr. Wallace served as the Director of Transportation & Logistics for Waste Management, the largest provider of waste management and recycling services in North America. He can be reached at bwallace@wihresourcegroup.com Tom Kraemer, PE is a registered engineer in California and Washington, and has worked in the solid waste management field for over 30 years. Tom joined CH2M HILL in 1986. Over the past 10 years, he has increasingly focused on organic waste management, designing and building organics processing facilities and analyzing alternatives for facility owners. Tom left CH2M HILL briefly from 2009 to 2011 to join a startup organic waste management company at which he was responsible for designing and building a digester plant processing municipal organics that is operating today.
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