California Digester Grants On Hold

A request for grant applications to help fund anaerobic dairy digester projects in California has been delayed until further notice.

The California Department of Food and Agriculture’s (CDFA) Dairy Digester Research and Development Program (DDRDP) received funding from the Greenhouse Gas Reduction Fund in 2016, set to go towards digester grants. These grants would provide financial assistance for dairy digester installations in California, an important part of the state’s efforts to reduce methane emissions from the dairy industry. Digesters would also create clean, renewable energy in the process.

However, dairy, health, air quality, and sustainability-oriented groups – in addition to companies endeavoring to build the digesters themselves – expressed concerns about these grants being feasible or incentivizing enough for digester development to proceed.

The DDRDP released the first draft of their grant application request in February so potential applicants could review and comment on them over a 2-week period. During this time many organizations responded, raising points and critical issues with the way the grants would be awarded and enforced. Among critics were Dairy Cares, the Agricultural Council of California, and the Bioenergy Association of California.

The most articulated points concerned the awarded amounts comparative to the costs – costs applicants must incur to meet the grant’s requirements for awarding in the first place.

Stephen McCorkle, CEO of Agricultural Waste Solutions, Inc., said, “What has been listed for the applicant requirements under this section is immensely time and cost intensive.”

“How are applicants expected to be ‘shovel ready’ within 6 months of the execution of the grant agreement, without any of the pre-development costs covered or latitude provided towards the due diligence needed to keep in-line of [the requirements]?”

Compounding the difficulties with the lack of costly upfront requirements for digester projects that already cost millions of dollars, only 60-70 percent of the initial $50 million from the California’s Greenhouse Gas Reduction Fund (GGRF) allocated to the CDFA was set aside to incentivize digester projects—and now even that amount may be reduced.

Michael Boccadoro, Executive Director of Dairy Cares, said, “This range of $29 to $36 million differs from CDFA’s previously stated intent to provide at least $36 million in funding for digesters.

“The unexplained inclusion of this new range suggests that CDFA is considering providing up to $7 million less funding for digesters than previously proposed,” he added.

Development and construction of anaerobic dairy digesters have slowed to a crawl, despite evidence they are among the most cost effective ways to reduce harmful, short-lived climate pollutants – such as methane – which have a potency up to 80 times the effect of CO2.

Very few digesters have been built in the last 2 years and currently, there are only about a dozen completed in the state of California. This is well short of the roughly 300 digesters that would be required for the state to reduce its greenhouse gases, the amount needed to meet the 2030 goals set out by legislature.

Said Boccadoro, “Much more than the current funding level will be needed to accomplish the state’s goals of a 40 percent reduction of manure methane from the dairy sector.”

Clearly, the DDRDP took these comments to heart, and are using this delay in requests for applications to find a better way forward. It’s fair to say all stakeholders are looking forward to an improved second draft.