2016 News - Energy: bioenergy and bioproduct solutions

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Michigan Farm Energy Audit Program – Auditor Training
Benjamin Van Zweden and Aluel Go

Photo of farm energy auditor training in a dairy milking parlor

Audits performed by auditors certified by the Michigan Farm Energy Audit Program have increased the number of approved on-farm energy efficiency projects in Michigan.

Michigan is the 10th largest consumer of energy in the United States. Of the approximately 2,882 trillion Btu of energy consumed, 683 trillion Btu (24 percent) is produced in Michigan. This means that 76 percent of the energy Michigan consumes is imported (USEIA, 2017). Michigan’s farmers are heavy energy users. They cultivate over 9.9 million acres of land and are a major contributor to the more than $102 billion Michigan food and agricultural industry (MDARD, 2017). Therefore, it is essential for Michigan farms to become more energy efficient to stay competitive in today’s global farm economy. In order to receive state and federal funding for energy efficiency upgrades, it is usually necessary for farmers to conduct certified energy audits following the ANSI/ASABE S612 Type 2 standards.

Before the Michigan Farm Energy Program (MFEP) started conducting certified farm energy audits in 2009, Michigan farmers were faced with a major challenge—they could not find certified farm energy auditors, and the cost to have an energy audit conducted was prohibitively expensive. Agricultural enterprises consume a considerable quantity of energy each year, so a certified farm energy audit can show operators ways to become more energy efficient and save money. MFEP was launched in 2009 to train certified farm energy auditors how to conduct audits meeting ASABE/ANSI S612 standards for Type 2 audits as required by federal funding programs. The lack of auditors who understand agricultural operations and can conduct affordable audits led to Michigan ranking in the bottom fifth of USDA energy efficiency projects throughout 2003-2009. Renewable energy did not fare well either, so the program developed a report format with USDA and expanded into renewable energy assessments in 2010.

Michigan had 35 USDA energy efficiency and 31 renewable energy projects amounting to $1,217,172 and $3,814,868 from 2003-2009. The data compiled in Table 1 shows Michigan’s USDA-funded energy efficiency project rankings compared to other states. The highest ranking Michigan ever achieved in the number of USDA-funded energy efficiency projects was 46th during 2003-2009. It was tied for 50th in two of those initial seven years. In 2010-2013, there were 381 (988 percent increase) energy efficiency and 410 (1,223 percent increase) renewable energy projects amounting to investments of $27,546,996 (2,163 percent increase) and $31,888,872 (736 percent increase), respectively, as compared to the previous seven years. This caused Michigan to climb to a fifth place ranking in 2012 and 2013 (USDA, n.d.). 

Table 1. USDA Energy Efficiency Project State Rankings
State
2003-2009
2012-2013
2014
Iowa
1st
1st
1st
Nebraska
2nd
2nd
2nd
Minnesota
3rd
3rd
4th
Illinois
4th
4th
5th
Wisconsin
5th
6th
6th
Michigan
46th or lower
5th
10th

This exceptional climb in ranking is due in part to the energy audit and renewable energy funding assistance made available through the Herrick Foundation, the Michigan Energy Office, and USDA-REAP. Farmers can have access to these funds only after a certified Type 2 farm energy audit is conducted. It is important that state and federal assistance is available to farmers to conduct energy audits and implement energy efficiency projects. The efforts of MFEP have significantly impacted Michigan’s USDA energy efficiency investment, and consequently, the number of energy efficiency projects. On the flip side, a reduction of MFEP and USDA assistance has a significant corresponding drop in state rankings, as observed in 2014. This can be seen in Table 1, when program funding was reduced by 50 percent and USDA energy efficiency projects in Michigan dropped in 2014. This drop in energy efficiency projects for 2014 resulted in an investment reduction of about $700,000, which is why Michigan lost its exceptional momentum and its ranking fell to 10th place (USDA, n.d.).

A certified Type 2 audit identifies areas for reducing energy costs and improving energy efficiency. For the audit to be effective, the farmer who requested the audit must compile a list of the farm’s current energy use. This list includes three years’ worth of monthly utility and fuel use figures, as well as equipment information, such as run time, age, and size. If the farm is a dairy operation, they must also supply at least one year’s worth of milk production records. An energy audit report will categorize this compiled information, and show areas for improvement in each category. Each energy use improvement recommendation will include the current cost, potential energy savings, potential cost savings, cost to implement, and payback period.

Auditors are not looking to tell operators what’s right or what’s wrong. Instead, they conduct audits ‘with eyes on-site’ to identify ways to improve energy efficiency and the costs to upgrade or replace current equipment or processes. The auditor takes a ‘whole enterprise’ approach when developing recommendations. The operators’ management practices are taken into full consideration since an operator is not likely to implement an energy efficiency recommendation if it negatively affects the management strategy. It is, therefore, very important that operators are forthcoming with their management strategy, and that the energy auditor becomes familiar with the type of operation and how it is managed.

All MFEP audits are voluntary and the reports are for the farmer’s use only. They are confidential and designed to be a management tool. As the national focus becomes zeroed in on energy efficiency and alternative energy, there are several national and state programs coming online that offer grants, rebates and loans for energy efficiency improvement and renewable energy projects. The key is, farms should first conduct a certified farm energy audit. MFEP Type 2 audits usually identify funding and assistance options from state, federal, university and utility energy efficiency programs/sources.

To insure completeness and accuracy of the farm or rural business energy audit, the audit report is submitted to the program manager at Michigan State University (MSU) who then submits the report to an experienced audit report reviewer. Once a satisfactory report has been approved, the auditor schedules a meeting with the enterprise operator to discuss the results and recommendations.

The MSU Department of Biosystems and Agricultural Engineering has played an important role in the formation of MFEP. MSU is also one of only three universities cited in the ANSI/ASABE S612 farm energy audit standards (ASABE, 2009). MFEP has received some very important recognitions since it was initiated, including:

  • Three USDA energy audit and renewable energy projects (2010, 2011, and 2012) were selected for evaluation/audit and each attained a 100 percent equivalent rating by USDA Washington.
  • Honorable Mention Recognition at the first Governor’s Energy Excellence Awards in 2015.
  • MFEP audits are the only farm energy audits accepted by Michigan utility providers when applying for a farm energy audit rebate
  • Michigan Energy Office and USDA-RD (REAP) recommend MFEP audits and renewable energy assessments conducted by MFEP auditors.

All of these accomplishments reinforce the thoroughness and credibility of MFEP audits, as well as the excellent training received by MFEP auditors at MSU.

MFEP has huge potential future impact since all of the results in Table 2 were achieved with less than one percent of Michigan’s agricultural enterprises. Therefore, it is important that state and federal assistance is continually available in the future, so MFEP can have an even greater positive impact on Michigan’s agricultural enterprises and the environment. Data compiled from MFEP energy audits and renewable energy assessment reports. Initially, MFEP energy efforts were directed to improving energy efficiency. The number of renewable energy assessments (indicated in red) has increased in recent years. For more information about MFEP, visit http://maec.msu.edu/farmenergy. If you are interested in an energy audit or renewable energy assessment for your agricultural enterprise, contact Aluel Go at goaluel@egr.msu.edu or 517-214-6128.

Table 2: 2010-2016 Energy Efficiency Savings

No. Operation Savings (kWh) % Savings Total Annual Savings ($) Total Owner cost to Implement ($) Payback Time (years) Potential Average Annual Savings ($) 2010-2016 energy usage (kWh)
133 Dairy Farms 11,190,946 35 1,214,725 2,741,579 2.3 9,133 31,657,884
57 Grain Drying 14,302,450 28 999,482 6,836,135 6.8 17,535 50,774,656
35 Greenhouse 27,762,764 34 1,106,753 4,917,592 4.4 31,622 80,842,002
27 Food/Fruit Process 2,371,934 38 338,023 1,347,791 4.0 12,519 6,217,231
19 Irrigation 4,433,969 51 418,839 1,560,736 3.7 22,044 8,667,256
12 Crops 375,529 4 53,583 130,250 2.4 4,465 9,311,834
5 Beef 69,076 14 9,913 19,476 2.0 1,983 508,483
4 Hogs 198,264 14 18,002 59,718 3.3 4,501 1,382,858
2 Poultry 12,618,901 62 567,365 2,053,625 3.6 283,683 20,245,372
36 Rural Business 13,706,260 36 768,458 1,916,983 2.5 21,346 37,708,309
1 Integrated Farm 11,358 94 1,693 3,480 2.1 1,693 12,136
3 Fish Hatcheries 2,085,817 13 93,610 206,775 2.2 31,203 15,895,284
334 Audit Total 89,127,267 34 5,590,446 21,794,140 3.9 16,738 263,223,304
154 Renewable Energy 24,763,113 69 1,797,018 15,636,108 8.7 11,669 35,893,424
488 Grand Total 113,890,380 38 7,387,465 37,430,248 5.1 15,138 299,116,728

References

American Society of Agricultural and Biological Engineers (ASABE). (2009). ANSI/ASABE S612 JUL2009 (R2015) performing on-farm energy audits. In ASABE technical library. Retrieved from http://elibrary.asabe.org.proxy2.cl.msu.edu/azdez.asp?search=1&JID=2&AID...

Michigan Department of Agricultural and Rural Development (MDARD). (2017). Facts about Michigan agriculture. In Michigan Department of Agricultural and Rural Development. Retrieved from http://www.michigan.gov/mdard/0,4610,7-125-1572-7775--,00.html

United States Department of Agriculture (USDA). (n.d.). Energy investment report. In United States Department of Agriculture. Retrieved from https://www.usda.gov/energy/maps/report.htm

U.S. Energy Information Administration (USEIA). (2017, January 19). Michigan state profile and energy estimates. In U.S. Energy Information Administration. Retrieved January 30, 2017, from http://www.eia.gov/state/data.cfm?sid=MI