Innovative Dairy Farm of the Year: Methane to the max

Editor's note: The following article appeared in the January 2016 issue of Dairy Herd Management.

While many dairy farms struggle to profitably operate methane digesters, Holsum Dairies has made methane digestion an integral part of its operations.

Holsum Dairies' methane digestion does all the things normally promised—and a whole lot more. It generates enough equivalent electricity to provide power for 8,200 cows and 2,600 heifer calves and an additional 400 to 600 residential homes. It provides reclaimed bedding solids for those cattle.

Waste heat from the power generators also provides heat for both operations, including a state-of-the-art calf barn. Excess electricity generated by the methane provided enough carbon credits to offset the carbon released by athletes from around the world traveling to London for the 2012 Olympic Summer Games.

Integrating methane digestion in these innovative ways is a key reason Holsum Dairies was selected as the 2016 Innovative Dairy Farm of the Year, sponsored by the International Dairy Foods Association and Farm Journal Media.

This is the 17th year for the award, and the fourth time a Wisconsin dairy farm has been selected. "'Reduce, reuse, recycle and measure' are Holsum Dairy management's guiding principles," said Ben Brancel, Wisconsin's Secretary of Agriculture. Brancel nominated Holsum Dairies for the award.

"From the heart of America's Dairyland, Holsum Dairies exemplifies the qualities of a forward-thinking and exceptional dairy farm."

Holsum Dairies operates two dairy farms about 4 miles apart near Hilbert, Wis., about 30 minutes south of Green Bay. Holsum Irish Dairy was built in 2001, with cows being milked on a 72-stall rotary. Holsum Elm Dairy was built five years later, using an 80-stall rotary. Together, they milk 8,200 cows and ship 190 million lbs. of milk annually (about 23,000 lbs./cow).

Holsum is owned by veterinarians Kenn Beulow and Bob Nagel, and Holsum Inc., whose senior partner is Marc Reischman.

Holsum employs about 100 workers, 90% of whom are full-time. They farm about 1,000 acres and work with about 40 local farmers to grow feed on another 7,500 to 8,000 acres.

In addition to the dairy farms, Holsum also owns a local cheese company, a milk concentration facility and next summer will open a 6,000-goat dairy near Madison, Wis.

But the heart of the operation is the dairy farms. "Methane digestion and sustainability are an integral part of our culture," said Bob Nagel, who has been with Holsum for eight years.

The digesters reduce, if not eliminate, manure odors as well. That's critical to good neighbor relations in an area dotted with farmsteads every eighth to quarter mile surrounding the large dairies.

The plug-flow digestion tanks, roughly 2 million gallons on each dairy, accept manure from the cow and calf barns, the parlor and holding pens and milkhouse waste. The only farm wastewater that doesn't go through the digester is from the footbaths. Copper sulfate in the baths would be deadly to digester bacteria.

Holsum also accepts up to eight semi-loads of food-grade wastewater each day from Briess Industries, a local food ingredient and specialty malt manufacturer, to add energy to the digester. Briess also supplies wet brewers' grain for inclusion in the milking rations.

The dairies also accept waste from three other food manufacturers, including cheese wastewater and food-grade grease trappings.

Their inclusion to the digester increases methane gas production and eliminates the wastewater stream from a local municipal wastewater treatment system. "That amount of wastewater and grease could easily overwhelm a small, municipal treatment plant," Nagel said.

Over the past three years, for example, Holsum Dairies accepted an average of 12 million gallons of wastewater per year. Plus, it fed between 3,000 and 4,000 tons of by-products per year and kept them out of local landfills.

All that methane gas production powers two, 600 kW generators on each dairy. In 2014, the two dairies generated about 9.25 million kwh of electricity. The dairies used just more than 6 million kwh, leaving an excess of 3 million kwh that would power roughly 400 homes.

All of the electricity is sold to the power grid, and Holsum then repurchases electricity to operate the dairies. "The grid is more reliable than our digesters; we can't afford to be offline for any period of time with dairies this size," Nagel said.

The excess electricity generated by the two dairies more than offsets diesel, gas, propane and fuel oil use on the farms on a carbon dioxide equivalent basis. In 2014, for example, the two dairies used about 171,000 gallons of diesel, nearly 11,000 gallons of gasoline, 64,000 gallons of propane and 29,000 gallons of fuel oil. The carbon dioxide equivalent of that fuel was 2,990 metric tons.

The 3 million kwh of excess electricity over and above what the dairies actually used amounted to 2,140 metric tons of carbon dioxide equivalent. And because electricity produced by cow methane earns a multiplier of 23, the total CO2 credit is 49,200 metric tons.

If you subtract the 2,990 metric tons of fuel use, Holsum Dairies actually earned net carbon credits of 46,211 metric tons in 2014.

It was these types of carbon credits which were sold to British Petroleum in 2012 to offset the Olympic athletes' travel to London.

Consequently, the digesters are a profit center for Holsum. "The system works and we believe in it, but it all boils down to how it is managed," Nagel said.

Unlike many other dairies, the methane digesters on both Holsum dairies were designed into the facilities when they were built. "They are not an add-on system, so we can take advantage of all systems," Nagel said. For example, heat from the generators provides essentially free heating for the parlors and holding pens, the maintenance shop and the 750-head calf nursery.

Reclaimed bedding solids also are used in the freestall barns and the calf-grower barns. No additional bedding is ever purchased.

Effluent from the digester, once it makes its way through the system, is then titrated through a three-stage lagoon system. The lagoon effluent already has 32% less nitrogen, 75% less phosphorus and 49% less potassium because of the energy produced and solids removal.

Holsum then sells fertilizer from each stage, based on nutrient content and value. The fertilizer is sold to the 40 crop farmers from whom Holsum buys its forage.

For example, the first stage lagoon is higher in nitrogen and phosphorus, and is used to fertilize corn. The third stage is higher in potash, which is much more suited for alfalfa. The second stage lagoon water will be targeted toward either corn or wheat, depending on solids content.

To reduce truck hauling, time and fuel use, Holsum has installed a mile of underground pipe to pump lagoon effluent to distant fields. Nagel hopes to install even more pipe in the next few years to improve hauling efficiency even more.

As a gesture to the local community, Holsum offers digested manure solids as a soil amendment to local gardeners in the spring and fall. The solids are offered free, but gardeners are given the opportunity to make a donation to the Holsum Dairies Scholarship Fund.

The scholarship fund has grown to the point that three, $500 scholarships are offered annually to local high school seniors.

The 750-head calf nursery barn, sited on Elm Dairy, is probably the only one of its kind in the world. (Jim Dickrell photo)

One-of-a-Kind Calf Barn

The 750-head calf nursery barn, sited on Elm Dairy, is probably the only one of its kind in the world.

The all-in, all-out facility is climate controlled, keeping the four rooms for the baby heifer calves at 65 to 68°F. Heat from the methane digester, which is located just across a service road, is used to warm the building.

Heated water is pumped to the calf barn, and circulates through pipes under the raised, steel mesh floors of the pens. No bedding is used in the pens, but calves can find their own comfort spots as the floor temperature goes from warmer to cooler from the rear of the pens forward.

Eight calves are housed in the 12' x 12' pens, with 26 pens per room. Calves receive colostrum through a mob feeder with multiple nipples the first three days after birth. Then they are switched to acidified waste milk fed ad libitum.

The waste milk, from fresh and treated cows, is brought to the calf barn daily and stored in nine, 900-gallon bulk tanks that are elevated 10' to 20' above the floor. The milk is treated with formic acid to lower the pH to 3.4.

The milk is then gravity fed to the calf pens, each equipped with two nipples. Calf starter also is provided from day one.

Calves remain on the milk for six to seven weeks when they are weaned. Average daily gain is 1.8 to 1.85 lbs./day.

An 80-cow carousel milks some 4,000 cows 3X on Holsum's Elm Dairy; a 72-cow carousel on Irish Dairy. Together, they harvest 190 million lbs. of milk annually.

(Jim Dickrell photo)

More on the Innovative Dairy Farmer of the Year Award

The Innovative Dairy Farmer of the Year Award is co-sponsored annually by the International Dairy Foods Association and Farm Journal Media.

Holsum Dairies will be honored at the 2016 Dairy Forum, Jan. 24-27, at the Arizona Biltmore, Phoenix.

"Holsum Dairies earned the 2016 Innovative Dairy Farmer of the Year Award because the farms demonstrate responsible land stewardship in creative ways," says Connie Tipton, IDFA president and CEO.

"The owners have incorporated many innovative initiatives to optimize milk production, minimize waste and commit to longer-term sustainability."

The 2015 winner was Hilmar Jerseys, Hilmar, Calif. Previous winners were: Milk Source, Kaukauna, Wis., McCarty Family Farms, Rexford, Kan., Sweetwater Valley Dairy Farm, Philadelphia, Tenn.; Brubaker Farms, Mount Joy, Pa.; Haubenschild Dairy Farm, Princeton, Minn., Mason Dixon Farms, Gettysburg, Pa.; Clauss Dairy Farms, Hilmar, Calif.; Baldwin Dairy/Emerald Dairy, Emerald, Wis.; Si-Ellen Farms, Jerome, Idaho; Pagel's Ponderosa Dairy, Kewaunee, Wis.; C Bar M Dairy, Jerome, Idaho; North Florida Holsteins of Bell, Fla.; KF Dairy of El Centro, Calif.; Joseph Gallo Farms of Atwater, Calif.; KBC Farms, Purdy, Mo.; and High Plains Dairy of Friona, Texas.

Forty landlords, one feed price

Since Holsum Dairies only has about 1,000 acres of crop land, it must contract with local growers for another 5,000 acres of corn silage and 2,500 to 3,000 acres of alfalfa haylage.

Given the area's relatively small farm size, that means Holsum must contract with about 40 landlords.

"Each fall, we have a meeting with all our growers and lay out our crop budgets and price structure," Nagel said. "Every one of the growers is there and hears the same discussion."

Prices are set in the fall, calculated to provide $50/acre more than if the grower would sell on the open market. If market prices change later, the price remains what was contracted.

"We're all in this together, so we all win together or we all lose together," Nagel said.

As the feed comes in, all loads are scaled and moistures tested since all prices are based on dry matter.

All harvesting is done by three custom harvesters. "We decide when to harvest, but for alfalfa, the harvest is timed off successive cuts," Nagel said.

Each farmer does his own tillage, planting and crop management. They also maintain their own nutrient management plans, working with local agronomists.

Holsum Dairies will sell them lagoon nutrients, priced on half of the first year nutrient value of the manure. That's a bit of a bargain, offered as an incentive to apply manure from Holsum rather than purchase commercial fertilizer.