Sen. Charles E. Schumer is pushing for a new tax credit to provide a boost to Western New York’s burgeoning dairy industry, establishing biogas as a renewable energy source eligible for a substantial tax credit.
The proposal would grant those who build biogas facilities a tax credit worth 30 percent of the cost, providing incentive for more farmers to get on board with the renewable energy movement.
For instance, if the installation of a biogas power plant cost $3 million, the buyer would receive $1 million to apply against taxes.
It’s a welcome development for local farmers like Dale Stein, owner of Stein Farms, a dairy farm in Le Roy, who have been considering methods to help their facilities go green but may not have had the funds to do so.
“It would be a big incentive to help farms make that step,” Stein said. “A lot of us want to make that step, but it’s not cheap. You’ve got to front a couple million dollars for these systems. I don’t know too many farmers with millions of dollars just sitting around.”
Stein also acts as the vice president of New York’s Soil and Water Conservation Committee, an organization that aids farmers in making improvements to their farms to become more environmentally friendly.
There are more than 4,800 farms in Western New York, according to statistics from the state Department of Agriculture. All farms, dairy or otherwise, produce waste in the form of manure or production byproducts that, untreated, pose threats to the environment in the form of water runoff or gas emission.
Installing anaerobic digesters, which use bacteria to break down organic waste and turn it into biogas, is one method of treating the waste. Alternatives like converting the waste into fertilizer for crops are cheaper than the initial cost of installing a digester but make less sense in the long term, Stein said.
“Steps like these are really advantageous for farmers,” said Lauren Toretta, president of CH4 Biogas, which operates New York’s largest biogas plant just outside Batavia. “They want to do this, but providing capital up front has been a real hindrance, especially on smaller farmers.”
Acid whey is another form of waste, created in mass quantities during the production of Greek yogurt and cottage cheese – two heavyweight industries in New York’s agriculture economy.
With a digester installed, acid whey can be broken down to produce methane gas, or biogas. That biogas is then burned to power a generator to produce electric energy, creating a renewable energy system farmers can use to offset electrical needs on their farm or sell back to the grid for a profit.
If each of the 4,850 farms in Western New York used this method in waste disposal, more than 25,000 tons of methane gas would have been produced between 2007 and 2013, according to data from the National Renewable Energy Laboratory.
Stein said he has been planning a $2 million expansion to his 3,000-acre dairy farm, doubling the livestock there from 500 to 1,100 heads.
With the incentive in place, he said he would now strongly consider adding a bio-digester system as part of the expansion, a project he was unsure he would have been able to undertake otherwise.
“It will help the farms be more sustainable into the future,” Stein said.