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Abstract
A stochastic capital budget was used to analyze the effect of net metering policies and carbon
credits on profitability of anaerobic digesters on dairy farms in Pennsylvania. We analyzed
three different farm sizes—500, 1,000, and 2,000 cows—and considered the addition of a
solids separator to the project. Results indicate that net metering policies and carbon credits
increase the expected net present value (NPV) of digesters. Moreover, the addition of a solids
separator further increases the mean NPV of the venture. In general, the technology is profitable
only for very large farms (1,000+ cows) that use the separated solids as bedding material.