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American farmers and the companies who work alongside them are feeling growing pressure from customers and policymakers to reduce greenhouse gas (GHG) emissions. As federal priorities and state-level legislation shift toward decarbonization, farmers need the solutions and support to maintain quality outputs while upholding their commitment to the land and the environment. The good news is that we are not without solutions – there are technologies and markets operating today that can drastically reduce GHG emissions and help reach global methane abatement goals ahead of 2030. Now, it’s up to policymakers to take the steps needed to keep these effective, market-based solutions moving forward.
Renewable Natural Gas (RNG) is an immediate solution that has the power to significantly reduce GHG emissions in agriculture. On-farm RNG systems capture methane emissions resulting from dairy farming and other agricultural production and convert it to renewable energy. This technology is the only viable pathway for livestock waste that tackles greenhouse gases and other air pollutants, all while supporting investments in advancing American farmers’ long history of environmental stewardship.
However, in order to scale and make RNG available to more dairy farms of all sizes, RNG must have reasonable access to new markets for clean energy.
Scaling clean hydrogen presents an important opportunity to make RNG more widely available. Right now, there is an active discussion on the best way to scale production, and the primary driver is the 45V tax credit, established by the Inflation Reduction Act of 2022, that incentivizes the production of qualified clean hydrogen for the energy sector.
Recently, the Internal Revenue Service (IRS) issued a proposed rule that would limit what processes and feedstocks are eligible for the credit, potentially excluding RNG from dairy farms. If the federal government wants the energy sector to reduce greenhouse gas emissions and rapidly deploy low-carbon renewable energy, the proposed rule must allow the ag sector’s RNG derived from dairy methane to qualify.
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RNG turns methane emissions from modern dairy farming into a pipeline-quality alternative fuel. The resulting fuel functions just like fossil-derived natural gas and works seamlessly within America’s current energy infrastructure, with significantly fewer emissions.
RNG is a clean hydrogen feedstock that is good for the environment and the energy sector. On the farm, RNG producers collect manure into a single effluent stream. Digesters enhance already tight runoff measures in place at modern dairy operations and, when combined with sustainable farming practices, further protect local water quality compared with daily manure spreading and other methods. Further, digesters make the nutrients in manure more available to crops to promote growth and reduce the need for commercial fertilizers. When farmers utilize waste-based methane, it prevents the gas from being released into the atmosphere – which means RNG is not just low carbon; it actually has a negative carbon impact.
As the world looks to cut methane by at least 30 percent by 2030, dairy farmers and other ag producers are fielding demands to reduce emissions. We have the technology and know-how to act now. However, we need to be able to use the established sustainability accounting practices backed by decades of research from the DOE, USDA, and EPA to access markets that recognize the value of methane abatement. No other method on the market offers a long-term solve for methane while creating revenue streams for farmers.
The production of methane from agriculture is inevitable but solutions like RNG that are at our disposal can help farms and food producers manage it to the benefit of consumers, the environment, and the economy. The 45V Hydrogen Production Tax Credit is a critical opportunity to rapidly accelerate RNG’s capacity to reduce emissions while benefitting dairy farmers.
Grant Zimmerman is CEO and director of Amp Americas, a pioneer in converting dairy waste into carbon-negative renewable transportation fuel and power. His focus is growing the market for RNG and other carbon-negative renewable products that combat climate change and improve air quality.