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The Pennsylvania-based company Ag-Grid Energy is using anaerobic digestion, a process that breaks down manure and local food waste, to produce renewable natural gas (RNG) to power an on-site cryptomine and potentially data centers. The company’s project reportedly recycles more than 45,000 gallons of food waste daily along with the manure of 4,000 cows. Critics argue that this initiative could incentivize the proliferation of factory farms and lead to increased pollution due to the by-products of anaerobic digestion.
Biogas: A Game-Changer for Cryptomining and Data Centers
Large machines that break down manure and local food waste into biogas, or renewable natural gas (RNG), are starting to power more than just homes, tractors, and electricity. At Lent Hill, the generated biogas is fueling an on-site crypto mine. The Pennsylvania-based company behind this pioneering project, Ag-Grid Energy, believes the anaerobic digestion of manure and food waste could disrupt the power source not only for crypto miners but also data centers, which currently consume around 4.9% of the country’s electricity, a number that could double by 2030.
Ag-Grid Energy recycles more than 45,000 gallons of food waste per day and the manure of 4,000 cows. The company aims to offer value to the rural area via the production of RNG and, if possible, contribute the value of the AI computing capacity to the same regional area, explains Rashi Akki, the founder and CEO of Ag-Grid Energy.
Transforming Manure and Food Waste into Fuel for Data Centers
While Ag-Grid Energy seeks to collaborate with mid-sized dairies to generate on-site power for small-scale data centers, big technology players have grander plans. Tech giants are increasingly exploring alternative fuel sources that could power hyperscale data centers without straining the grid. A growing group of industries, including agriculture, fossil fuels, utilities, and waste management, are advocating for RNG from manure digesters as a sustainable way forward.
In California, Microsoft has partnered with Enchanted Rock to use RNG for backup data center power. Meanwhile, Black Rock’s portfolio company Vanguard Renewables calls RNG the “fuel of the AI age.” Some critics, however, worry that the connection between digesters and data centers may provide an economic lifeline to digesters at a time when they’re struggling to stay afloat.
According to Sarah D’Onofrio, a scholar and advocate who works with communities impacted by digesters, RNG from digesters is hailed as a drop-in energy solution. This means RNG can be used without modifying existing fossil-fuel-based infrastructure, allowing companies to claim sustainable fueling of data centers. However, D’Onofrio and other researchers argue that the transition to clean energy fuels is necessary to truly reduce emissions instead of relying on renewable substitutes for fossil fuels.
The Proliferation of Factory Farms and Environmental Concerns
Some fear that the manure-to-energy industry, fueled by data centers, could lead to the further expansion of factory farms. In the U.S., animals on factory farms produce an estimated 941 billion pounds of manure annually, causing air and water pollution nationwide. Despite the potential benefits of digesters in managing this waste and reducing methane emissions, they do not eliminate the manure. The digested waste, or digestate, is intended for recycling into products like fertilizer and animal bedding. However, the challenges related to these downstream products range from economic to environmental.
Victoria Gehrke, a community organizer in Lind, Wisconsin, experienced the impact of a proposed co-digester in her town. Co-digesters would bring hazardous air emissions, constant transport of industrial food waste, and potential water pollution. After a year of community opposition, Vanguard’s application was denied in 2024. Despite this victory, Vanguard continues to operate more than 50 co-digesters across the country and plans to complete over 100 projects by 2028.
Biogas as a Reliable and High-Capacity Fuel Source
Patrick Serfass, the executive director of the American Biogas Council, views biogas as an “excellent fit” for data centers in need of a reliable and high-capacity fuel source. The demand from data centers could lead to an expansion of co-digester buildouts across the country. “The data centers are going to be so hungry for power that they could eat up pretty much all of the supply that the biogas industry could create,” says Serfass.
Vanguard Renewables shares a similar perspective, emphasizing the growing interest in reliable and lower-carbon solutions as the energy demand from data centers increases. The company has not yet partnered directly with any data centers, but it has partnered with energy delivery companies like TotalEnergies and Enbridge, which have relationships with hyperscalers and data center operators.
The RNG from digesters has long been promoted as a solution to agriculture’s methane problem, receiving substantial subsidies at both federal and state levels. However, this investment in digesters has sparked debates about their economic and environmental merits. Research indicates that government subsidies for digesters can inadvertently encourage farmers to produce waste for profit, not food for consumption. Moreover, while digesters can reduce methane emissions, they may also lead to an increase in other pollutants, creating a situation referred to as “pollution swapping.”
Concerns from Communities Living Next to Co-Digesters
Kathy Morrison, a farmer in Fremont, Michigan, lived next to a co-digester for years and experienced its significant impact on her quality of life. The unbearable smell often woke her up in the middle of the night. While Morrison is not against the technology of digesters per se, she is concerned about the scale of their operation and the potential for shortcuts when driven by profit. She sees data centers as increasing the opportunities for profit and, in turn, the potential for these issues.
This article originally appeared in Sentient
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