Completing a Successful Feasibility Study for an Anaerobic Digestion Project

This fact sheet explains how to design and evaluate feasibility studies for livestock-based anaerobic digestion projects, with a focus on dairy systems. Feasibility studies help determine whether a proposed digester project is technically viable, financially feasible, and capable of attracting investment. The publication outlines three levels of feasibility studies: general assessment studies that screen opportunities, techno-economic studies that evaluate costs and benefits for a specific project, and investment-grade studies used by investors and lenders. Key elements discussed include evaluating feedstocks, estimating capital and operating costs, projecting revenues from energy and other digester products, and assessing market conditions and financial risks. The guide also describes common analytical tools and financial models used in digester project development, including enterprise budget calculators and sensitivity analyses. By identifying potential risks and “fatal flaws” early, feasibility studies help farmers, project developers, and investors make informed decisions before committing significant resources to anaerobic digestion infrastructure.

This work was supported by Biomass Research Funds from the Washington State University Agricultural Research Center, the Washington State Department of Commerce, and the USDA National Institute of Food and Agriculture (award #2012-6800219814).