Twenty-seven years ago when David Leskowski lived on a Saskatchewan farm and made plans to build an anaerobic digester, he came to one conclusion; it was not the right time.
Fuel and energy were relatively cheap, and farms were miles away from urban development, so complaints about the smell of manure were rare. Environmental concerns were still in the incubator stage.
Today, Leskowski is president and co-founder of Community EcoEnergy Corp. (ECC) in Thunder Bay, and he and several partners are on the verge of seeing the startup of a pilot project that could have a major impact on how farmers and municipalities handle organic waste.
“One of the most critical factors in whether a business succeeds or fails is timing,” says Rod Wade, senior vice-president of the company. “Within the last couple of years, several things happened to motivate us to start a pilot project converting organic material into clean energy and high-value products, and to launch CEE as a privately-owned, for-profit business.”
The catalyst was the Walkerton water crisis, which resulted in new regulations controlling manure handling nutrient management, and consequently higher costs for producers who must comply.
Other forces included concerns about groundwater contamination, new environmental regulations, the Kyoto Protocol and increased energy demands, which are in turn creating opportunities for producers.
Other factors include worldwide concern over greenhouse gas emissions, declining farm revenues and employment as costs continue to rise and ever-decreasing distances between cities and farms.
The idea of using organic matter, specifically livestock waste and municipal sewage, to produce biogas, a mixture of primarily carbon dioxide and methane gas, is not a new one, says Wade.
Evidence shows that in Assyria during the 10th century BC biogas was used for heating bath water.
Anaerobic digestion (AD), as the conversion process is called, has been in practice in Europe for many years, but today’s technology operates at much higher efficiency than the systems installed 20 years ago, he explains.
With financial assistance from the Northern Ontario Heritage Fund, the pilot project launched by CEE in partnership with Pascol Engineering and the Thunder Bay Farmers Co-op will demonstrate the commercial potential of AD. The process will involve using biogas as fuel for electrical generation while producing organic fertilizer, plant food, carbon dioxide, and other byproducts. Emission reduction credits will bring in additional returns.
These multiple revenue streams will prove that the system can be cash-positive in a very short time, and this is what makes CEE’s system unique, says Wade.
Circle D Farm, owned by Gerald and Sheri-Lyn Dykstra, is the location of the pilot project, which should be up and running in April or May 2003. The farm’s cattle are the input production staff.
The system is fairly simple, explains Wade. The manure is pumped from the barn into a blend tank where it is pre-heated and mixed with other organic material. It is then pumped into the AD tank and processed at temperatures reaching 55 degrees Celsius, ensuring maximum gas production and pathogen kill. This tank has several hatches, which will allow the resulting methane gas to be piped out for storage. The effluent is processed through a de-watering press, and separated as liquids and solids for use as fertilizer. The liquid part can also be returned as water for use by the farmer either for the herd or crops. Electricity is produced by burning collected methane in a generator, and can be used on the farm, or sold as excess to the energy grid, Wade says.
Carbon dioxide is “scrubbed” from the biogas before reaching the generator and can be bottled and used to aid plant growth in greenhouses.
As well, CEE is in business to manufacture, sell, install and manage AD plants across North America.
The market is there, says Leskowski. In fact, he believes it is nine or 10 times what the business could supply.
“I think it might be possible for us to grow to capture 10 per cent of the market, but a more realistic figure would be three to five percent,” Leskowski says.
A questionnaire sent out across Canada to large farm owners came back with a 90 per cent positive response, and the partners now have farmers working with them.
In fact, a Hamilton area farmer visited Thunder Bay, looked over the pilot project and placed an order.
Fab Industries, based in the United States, is also interested, and wants to approach the City of Thunder Bay regarding use of the system for sewage treatment.
The modular system is portable. The largest component, the AD tank, can be carried on a flatbed trailer.
Thunder Bay was chosen as the destination for the project because of its central location, which allows the product to be shipped anywhere in North America, via rail, highway or waterways, Leskowski says.
It is close to the largest agricultural market, the U.S. Midwest, as well as the prairie provinces, southern Ontario and Quebec.
Pascol Engineering, the manufacturing partner, is located in Thunder Bay, and Wade says that everything except certain controls can be manufactured locally.
The cold winters of northwestern Ontario were also ideal for the prototype.
“If it works here, it’ll work anywhere!” says Wade.
The cold weather has also made Thunder Bay an ideal location for research and development. and according to Keith Wilson, vice- president and chief operating officer, Lakehead University has provided excellent consulting services through Cam Lueng, PhD, an assistant professor of microbiology and Meilan Lui, PhD, an assistant professor of mechanical engineering.
With an educated workforce available in Thunder Bay, and a cost of living that is lower than many other Canadian cities, the company is confident it can supply employment at competitive wages, thereby providing a good standard of living for employees. Commercial rental space is reasonably priced, and there is the advantage of the competitive Canadian dollar, says Leskowski.
“With today’s technology, and the fact that we will have to travel to the customer to set up the system, Thunder Bay works well as headquarters for our business,” says Leskowski.
Leskowski has an educational background in renewable resources technology, and experience with federal and provincial environmental departments. As well as working as a risk management consultant, insurance broker and underwriter, he also owned and operated several companies. He chose to bring his family to Thunder Bay, and says he has found many opportunities in the city.
Wade came to Thunder Bay from Oakville, started working in the insurance business, then met Leskowski, and the partnership developed from there. In fact, the liability issues, which arose out of the Walkerton crisis were paramount in their decision to go ahead with the AD system.
Wilson brings many years experience in design, manufacture, on-site installation and startup of digesters and other chemical and manufacturing systems. He and his family chose to move to Thunder Bay from New Liskeard.
Jeff Stubbings, vice-president and director of information technologies, also comes from an insurance background. He is an experienced systems administrator, skilled in designing and operating LANS and WANS and implementing IT programs.
Pascol Engineering came on board as a strategic partner, and has fabricated the 32-foot by 10-foot AD tank, and other system tanks. The 18-month partnership has worked well, and Pascol has the right of first refusal for future manufacturing for CEE.
The partners are working hard to have the pilot project operational within the next few weeks, and want to kick the business up to the next level. They are actively seeking investors, and invite interested parties to check out their Web site at www.ecoenergycorp.ca
