Today, there are more than 191 biogas sites already operating on farms and about 1,500 more at wastewater treatment plants, but there is tremendous opportunity for more growth in biogas systems.

Biogas: Big Opportunities, But Beware the Risks

Aaron Kalisher and Craig Bierl | Chubb Insurance

 

The development of new biogas sites to reduce methane gas emissions and convert the gas into a renewable energy source is getting some high level support in the United States. The Biogas Opportunities Roadmap, a report issued by the U.S. Department of Agriculture, the U.S. Environmental Protection Agency and the U.S. Department of Energy in August 2014, outlines the federal government’s plans to promote the U.S. biogas energy industry as it seeks to meet renewable energy goals while reducing methane gas emissions.

Today, there are more than 191 biogas sites already operating on farms and about 1,500 more at wastewater treatment plants, but there is tremendous opportunity for more growth in biogas systems. The Roadmap found that with the proper support, more than 11,000 additional biogas systems could be deployed. As new biogas sites are developed and production increases, owners and operators of these sites should take care to understand the risks involved with biogas production.

 

The Outlook for Biogas

Although the biogas market is a small part of the overall bioenergy sector, the potential for growth is clear. Global revenue was projected to roughly double, from $17.2 billion in 2011 to $33.1 billion in 2022, according to a Pike Research report. The market is expected to grow as interest in clean, renewable energy increases.

Growth is also expected as regulators on the state and federal levels set renewable energy goals. Currently 37 states recognize biogas in their state renewable energy goals and the U.S. government has set a target for 20 percent of the electricity consumed by federal agencies to be from renewable energy by 2020, according to the Roadmap.

Biogas helps to reduce methane gas emissions by capturing methane that otherwise would have been released into the atmosphere. Biogas is produced by anaerobic digestion, or the decomposition of organic waste in an oxygen-starved environment. Organic waste, such as livestock manure, food and other materials, decomposes in anaerobic digesters, where bacteria, heat and pressure break the materials down and change them into biogas and inorganic fertilizer byproduct. The biogas is typically composed of about 50 percent methane and must be upgraded or purified for transportation fuel applications.

The federal government hopes to encourage the use of biogas by using existing programs as a vehicle to enhance the utilization of biogas systems. It also plans to strengthen programs that support the use of biogas for clean energy, transportation fuel, renewable chemicals and bio-based products, as well as foster investment in biogas systems and strengthen markets for biogas systems and system products. A Biogas Opportunities Roadmap Working Group will collaborate with the industry to publish a progress report in August 2015.

 

Risks and Safety Considerations of Biogas Production

Biogas production can be a risky business. It requires workers who will oversee equipment on a daily basis, generates flammable gases, and uses heat and pressure as part of the production process. Risks associated with biogas facilities include the potential for gas leaks, fires and explosions, which could result in damage to equipment and property, as well as injury to workers and visitors. In 2012, for instance, a digester used to produce biogas at an Oregon dairy farm caught fire, resulting in an estimated $250,000 in damage. A 2009 study carried out by Germany’s Federal Ministry for the Environment, meanwhile, found critical safety flaws in over 60 percent of the biogas facilities examined.

Most importantly, the biogas facility has to be designed for success.  A plant built to maximize gas output without taking into account reliability and safety is a recipe for problems. Operational and maintenance specific safety systems should be “baked” into the facility which can be accomplished through the Prevention through Design (PtD) model which is specially recognized by the U.S. National Institute for Occupational Safety and Health (NIOSH) for renewable energy projects.  

A robust risk management program should take into consideration not only the safety of its workers, but visitors and third party contractors, as well as possible emergency responders. Frequently, these biogas plants may be located on farms or within a community where tours are given to demonstrate “green energy,” potentially putting others at risk.

In terms of operational and maintenance-driven safety, there are several areas of risk that are specific to biogas facilities.  For example, employees and/or contractors may be injured when working in confined spaces or as a result of toxic gasses or a lack of oxygen. Safety programs, referred to as Confined Space Entry programs by the U.S. Occupational Safety and Health Administration (OSHA), can help address these issues to insure that facilities are well ventilated or, depending on the type of confined space, require a permit-based system for workers entering these locations.

Biogas facilities should also have programs to control hazardous sources of energy, including electrical, mechanical, pneumatic or hydraulic energy.  A lack of these programs, called Lockout Tagout programs, and subsequent training is a leading source of safety violations according to OSHA.

In order to ensure these safety control measures are implemented, there should be formal, documented procedures to evaluate and help minimize the risks associated with these hazardous activities.  This is generally referred to as a Job Safety Analysis or JSA.

To keep operations running smoothly, owners and operators of biogas facilities should make sure that equipment is properly maintained and protected. A predictive and preventative maintenance program should be implemented for all equipment, but it is especially critical for those systems essential to the plant’s operation. In addition, hard-to-replace spare parts should be kept on hand so that any problem can be resolved quickly without significant downtime.

While maintenance can help to reduce the risk of a leak, fire or explosion, detection and suppression systems still should be installed. Biogas facilities should have methane detectors as well as smoke and heat detection systems that include callout alarms to provide early warning. Fire suppression systems also should be installed.

Critical assets should be segregated so that a fire or explosion in one part of the facility does not damage all of the equipment. Equipment also should have an automatic shut off in case of emergency and should not have an automatic restart feature.

Pressure levels also must be managed carefully. Digesters should have a minimum of two pressure release devices to prevent either an explosion or implosion of the anaerobic digester tank. Digesters also should have a flare system to burn off excess gas.

The coming years should bring expanded opportunities for the biogas energy industry as the government plays a growing role in encouraging the use of biogas. As a reliable source of renewable energy that also reduces greenhouse gas emissions, the benefits are clear. By taking care to properly build and maintain biogas facilities and equipment, the industry can take advantage of these new opportunities while managing the risks.

 

About Aaron Kalisher and Craig Bierl
Aaron Kalisher is vice president, executive market segment specialist, loss control services, and Craig Bierl is senior energy risk specialist for loss control services at the Chubb Group of Insurance Companies.  Email 
akalisher@chubb.com and cbierl@chubb.com.

 
 

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