Technical Report

Integration of Anaerobic Digestion into Farming Systems

in Australia, Canada, Italy, and the UK

June 2021

Executive Summary

The four countries – Australia, Canada, Italy, and United Kingdom – differ with respect to their size, climate, and type of agricultural production. Canada and Australia have the largest landmass but vastly different climates. Anaerobic digestion and biogas production in the agriculture sector is highest in Italy, followed by the UK, Australia, and Canada.

The adoption of anaerobic digestion (AD) has grown in all four of these countries over the last decades, albeit at different rates. In all cases, energy and climate change policies have been the dominant drivers that have enabled growth. In Canada, energy, waste management and environment policies are mostly under provincial jurisdiction, and thus AD development is discussed by province.

The environmental sustainability of agriculture has many facets. In this section of the report, each country description provides a different lens on sustainability and the role of anaerobic digestion. In Australia, AD is used primarily to reduce the environmental impact of wastewaters from red meat processing and piggeries. The section by Canada describes the regulatory framework for AD in agriculture in the different provinces. Italy has seen widespread adoption of the BiogasdonerightR concept – a set of innovations that includes AD as a core technology. In the UK, AD of manure along with improved crop production technologies, including precision agriculture, are reducing the environmental footprint of agriculture. Other environmental benefits such as the destruction of pathogens and weed seeds are also noted. Agriculture is a source of GHG emissions but has the capacity to remove CO2 from the atmosphere and sequester carbon in the soil. Anaerobic digestion and the production of biogas can reduce the GHG emissions from manure management and offset more GHG-intensive forms of energy; together with increased photosynthesis associated with catch crops and increased soil organic content associated with no till, this can result in negative emissions in the circular economy system. The GHG impact of AD depends on the availability (collectability) of feedstock and the GHG intensity of the country’s energy system. In Australia, there are significant amounts of collectible manure and adoption of AD could reduce both manure emissions and energy related GHG emissions from the broader economy. In Canada, the potential varies significantly by province, depending on the amount of collectible manure, the percentage of hydroelectricity in a province’s energy system, and renewable natural gas (RNG) policies and incentives. Upgrading biogas to RNG provides greater emission reductions but is only financially viable for large AD systems. In Italy, the adoption of the BiogasdonerightR (or BDR) concept can significantly increase carbon sequestration in the soil, reduce farm GHG emissions to close to zero and offset GHG emissions from the energy system. AD is a core technology in this concept that is complemented by the production and use of catch crops (fast growing crop grown between successive planting of main crop) and greater digestate production. Similarly, in the UK, emissions reductions in farming involves precision farming, AD and the appropriate use of digestate – part of the trend to more sustainable agriculture.

The adoption of AD at Australian piggeries and direct on-site use of biogas energy is financially profitable with pay back periods under 10 years. Off-setting on-farm energy costs (electricity, diesel, LPG) and selling surplus energy to the grid are critical to the financial bottom line and are more reliable than revenue from carbon credits that can disappear with a change in government. In Canada, investment in on-farm AD systems has required a long-term feed-in-tariff (FIT) contract and revenue from tipping fees for offfarm material. Most FIT programs have ended, and two Canadian Provinces are now offering premiums for RNG production that could offer opportunities for larger AD systems. In Italy, the incentive for producing energy from biogas has continued to decline since 2008. With the adoption of BiogasdonerightR, farmers are expected to increase their revenue and reduce biomethane production costs by extracting more value from digestate nutrients, use less expensive second crop harvest (in place of first crops), and achieve greater first crop yields. In the UK, farm adoption of AD can change crop selection as well as the farm’s business model. There are several different ways for a farm to finance new AD systems, ranging from being strictly a feedstock supplier to 100 % ownership.

In all four countries there are opportunities to increase the production of biogas and renewable energy from on-farm AD systems. In both Italy and the United Kingdom, energy from biogas is explicitly recognized as a mitigation measure in the respective countries’ renewable energy and climate change policies, and AD is well integrated into crop production. The policy signals and financial incentives are significantly weaker in Australia and Canada and would need to be strengthened to encourage new investment that would achieve the growth potential for agricultural AD projects in these countries. Apart from the use of digestate on agricultural soils, here AD has not yet been integrated into crop production and the broader concept of sustainable agriculture.

In the last section of the report, on-farm AD success stories are described by Australia, Canada, and the United Kingdom. Italy uses a case study of a hypothetical farm in Northern Italy to illustrate, in quantitative terms, the potential GHG emissions reduction and carbon balance that could be achieved with the adoption of the BDR concept.

Two page summary