Gold Rush

Daryl Maas followed his dreams to California, where he is filling an important niche helping mitigate climate change and dairy farmers mine the lucrative rewards of cow manure.
By Ron Kotrba | January 03, 2020

Daryl Maas was raised among the Dutch dairy farms of Northwest Washington. After joining the military and serving his country, Maas came home to the place he knew so well to further serve—but in a vastly different capacity. This time, he was to help those same dairy farmers around whom he was raised. Searching for a post-military career in his hometown, his radar picked up on dairy digesters and he never looked back.

“My brother Kevin went to graduate school, so we put a business plan together,” Maas says. “We started looking at funding, talking with good friends we grew up with who were now running their parents’ farms, and we began investigating technologies.”

The brothers Maas launched Farm Power Northwest in 2007. “I was the CEO, and Kevin was the CFO,” Maas says. “We raised local money and our first project came online in 2009—just a few miles from where we grew up.”

And so, it began. “Farm Power Northwest grew, and then I moved to California and started seeing big opportunities there,” Maas says. “My brother wasn’t interested in moving to California or expanding. We were building in Washington and Oregon—we built five digesters in the region at that point. Farm Power Northwest was our day jobs, but I began exploring the California market. It was a much more interesting market to me. There are more dairy cows there than any other state. And California has a lot of incentives for renewables that could be interwoven into the mix. I began spending my evenings and weekends learning more, doing some consulting, and bit by bit as more opportunities arose, it became my day job.”

As a result, Maas, like so many before him, was drawn to the bounty of the Golden State, neither seeking the glitter of Hollywood nor the sweet nectar in the citrus groves spanning the vast countryside. Maas knew there was gold in dairy manure, particularly in the mitigating effects dairy digesters have on climate change while helping grow renewable energy production, and the financial rewards of both. Rewards that could be shared amongst those with whom he had such a deep kinship—dairy farmers. He set out on his own, sans brother Kevin, and created Maas Energy Works.

Founded in 2010, Maas Energy Works initially had one employee on the payroll—Daryl Maas. “My office was half of my master bedroom,” he says. Today, Maas Energy Works employs 26 full-time workers plus contractors. The company has 22 operating digesters online with another 41 in development. When asked to share what those numbers mean to him, Maas says, “It’s colossal. When we first started, I was going to build one. I would tell investors the big, grand vision was seven digesters in seven years. I thought that would never happen. Now we’re building seven every year. It’s hard to picture.”

The beauty of Maas Energy Works’ offerings for dairy farmers is, he offers choices: producer- or developer-owned digesters. If a dairy farm chooses the former, then Maas Energy Works handles all design work, financial projections, grant financing, grid interconnections, regulatory permits, procurement, and construction management. When the project is online, Maas Energy Works operates the site for the dairy farm, with 24/7 monitoring and operations support. If a dairy farmer would rather not own a digester, they can sit back and collect the cash in a guaranteed annual rate per cow as Maas Energy Works develops, builds and operates the facility at no cost to them.

The popularity of producer- or developer-owned dairy digester projects goes in cycles, according to Maas. “Early on, when I first got into the California market, most farmers didn’t want to own a digester,” he says. “They thought it wouldn’t work. So, early on, the developer would own them. But in recent years, as digesters became more profitable and popular, a majority of new farmers want to own the digesters themselves. They see neighbors and extended family members with them. We believe the farmer ought to have a choice. Some developers want to own everything—the farmer could invest in it, but not own the entire thing. We think it’s important to give them the option, and many now are 100 percent owned by farmers.”

Maas says a lot has changed in the world of dairy digesters since he began. “The first expansion round was based on the U.S. Department of Treasury’s 1603 Program through which projects could get large grants based on the capital costs of the project,” he says. “In the beginning, there was a burst to build, and the more expensive, the better—because it would mean a bigger grant. Once that went away, it was healthy because it encouraged people to build digesters as economically as possible.”

This transition is what drove Maas Energy Works to the covered lagoon design vs. mixed plug-flow designs. “In California, we realized how simple and awesome a covered lagoon design would be—it’s the preferred method in warmer climates,” Maas says. “The operation of a covered lagoon is reliable, simple and cheaper to build. That was our first big transition.”

The company makes small improvements in its designs every year. “But honestly,” Maas says, “not a lot of good can come out of building complex, patented digesters. We think the real unique aspect we offer is execution. The renewable energy industry is so full of pie in the sky. We believe the best approach is to keep costs down, support the projects well, operate them reliably, and avoid mistakes. We focus on a simple, reliable design, we build on schedule, deploy them and keep them running. California is littered with digesters that have big, public openings, and then they are shut down three years later. That’s common. The key we bring to the table is reliable execution—not so much new, patented designs.”

For the first four years in the business, Maas was not the one-stop-shop he and Maas Energy Works are today for womb-to-tomb dairy digester project development and operation. “Back then, we hired a single contractor to design and build the turnkey system—we didn’t know anything,” Maas says humbly. “The banks wouldn’t lend us money, we had no experience or science background—nothing that the bank would recognize. So, we hired one contractor and paid them a fee to build the entire system. I quickly realized that, to be successful, we had to do it ourselves.” After years of immersion studying the complex world of carbon credits, utility tariffs, design-build-operation and business nuances, Maas says, “After about 2013, we were delivering complete projects more or less ourselves. We still hired construction contractors, but we controlled the whole process, which is critical. This helped us truly understand how digesters get built, particularly in California, which is so difficult for permitting. Beginning to end—that’s what we provide now. Not an amazing, patented design, but a team that knows the entire process and can deliver the project through the end in this difficult state.” 

The company has also transitioned from purchasing preassembled, turbocharged Siemens genset packages from vendors to assembling the gensets itself in Redding, California, where it shares a fabrication shop with its sister company, Electric Innovations Inc. “It’s critical to build the equipment ourselves so we’re not reliant on outside work,” Maas says. Between Electric Innovations and Maas Energy Works, the two separate companies employ roughly 50 people. But many of the dairy digester projects in California have moved from electrical generation toward feeding the pipeline with biogas, thanks to the Low Carbon Fuel Standard and the ability to generate significant carbon credit cash as a result. “We still do some electrical generation, but it’s a minority of our work now,” he says.

Pixley Biogas with Calgren Renewable Fuels was Maas’ first project in California. Little did he know then, in the early 2010s, what his early work there—helping the ethanol plant build a small digester to offset maybe up to 4 percent of its natural gas usage—would become. “A lot came from that,” Maas says. This parlayed into a giant cluster project that, perhaps when history looks back on the achievements of Daryl Maas, may very well be viewed as his magnum opus.

Dreams Realized
Lyle Schlyer, president of Calgren Renewable Fuels in Pixley, California, says his company’s earliest digester “is a big, old concrete box.” Designed by DVO, Schlyer says it is a modified plug-flow as opposed to a stirred tank design. “We’ve operated that for quite some time, so it wasn’t a big leap for us to get involved in manure digesters.”

The emerging cluster concept between Maas and Schlyer started taking shape in 2016. The idea was to secure as many dairy farmers with adjoining land surrounding the ethanol plant to agree to position digesters on their property and pipe the biogas to a central location—the Calgren Renewable Fuels ethanol plant—where a biogas cleanup plant and interconnection to the utility pipeline would be located.

The area dairymen were being approached left and right by potential digester developers for quite some time. “They were skeptical,” Schlyer says. “They were offered promises, promises, promises and got nothing but failed approaches. Daryl had credibility. He had already done a handful of projects. And we had credibility as we were running the ethanol plant at the same time. The combination allowed us to get to a critical mass. The investor said, ‘If we get six to sign up, that would be great.’ We ended up with nine, which expanded to 12 dairies and 11 digesters in Phase 1. That will be complete by the end of [2019]. Then Phase 2 will be ready to go. If you build it, they will come. It’ll be about double the size. When we’re done, I wouldn’t be surprised if we have close to 25 different dairies. But we’ll see.”

Schlyer says a main driver for the rush to dairy digesters in California was the Air Resources Board’s expansion under the Compliance Offset Protocol Livestock Projects, which had previously relegated carbon credits to the cap-and-trade system. “Then they decided to expand it to the LCFS,” he says. “That was huge. We’re talking $18 vs. a couple hundred dollars. Then it all started to come together. As soon as we got approval, we were off and running.”

The way the livestock protocol works, Schlyer explains, “is we get the most for a milking cow that’s in a free-stall barn,” he says. “The cow’s manure is washed down in a wet manure management system. That generates the biggest credit for us. So, in Phase 1, we get credit for the equivalent of 38,000 wet cows, but the actual number of animals is over 70,000, which includes both cows and heifers. Milk cows eat more, so you get a bigger credit for their manure. So, the way the livestock protocol works is, you get the biggest credit for capturing the most amount of manure [that would otherwise go uncaptured].”

After dairy farmers were sold broken promises early on, Schlyer says he and Maas had to push hard to get participants onboard. “We thought what would make the most sense early on is to get a bunch to sign up and we would bear all the costs, and write them a monthly check for their manure,” he says. “The amount depends on the value of what we get out of it in terms of incentives. In Phase 2, there’s a number of folks interested in doing their own projects, so they’d just be hooking up to our pipeline, having us clean the gas, and then we’d share the benefits in a very different way. They’d have a lot of capex involved. So, we started out with a fairly consistent program in which we essentially treated all participants the same, and it morphed into a situation where we’ll do very different deals with different folks, depending on what makes the most sense for them and us.” 

The Calgren Dairy Fuels digester pipeline cluster is now injecting renewable compressed natural gas into the SoCalGas Utility Pipeline, Maas proudly says. Today the cluster features 22 miles of pipe on 12 dairies. “That’s just the initial phase,” Maas says. “As we expand into Phase 2, the mileage will grow.” Maas says he’s working on developing a feasible “virtual pipeline” too, for smaller dairy farms that may not have adjoining land through which the physical, private pipeline can cross. “There are a lot of small dairies and we’d love to get involved with them,” he says. Maas envisions nearly a dozen similar dairy digester pipeline clusters in California, eventually.

Although Maas can speculate what’s on the bright horizon for his successful startup, he says the immediate future is booked, wrapping up the dozens of projects currently in development. “That’s a lot,” he says. He adds that he’s interested in probing the idea of establishing an electric vehicle charging station. “California makes it possible to generate power at one location and nominate that power to be used at another location and claim the credit.” This is a concept similar to directed biogas.

Big things happen when visionaries like Maas and Schlyer come together, as evidenced by the Calgren Dairy Fuels digester pipeline cluster. But they couldn’t have done it without the vendors and contractors upon which they relied. To name a few of those partners, Maas says the gas clean up equipment uses Vilter compressors by Emerson, and membranes by Air Liquide. Hartman Engineering performed most of the civil work for the digester ponds. Environmental Fabrics provided liner and cover work. Provost & Pritchard did some of the early pipeline work. And, of course, Maas Energy Works’ sister company Electric Innovations played a great role too. In addition, several other individuals and companies helped make this dream of Maas and Schlyer’s a reality.

It’s no secret that Calgren Renewable Fuels is beyond cutting edge in its approach to bioenergy. It operates a true biorefinery in Pixley, California, making ethanol, cattle feed, biogas and a recently commissioned biodiesel production facility onsite. “Lyle’s an institution,” Maas says. “He’s been a very early advocate for what we do, and he is a great client.”

The respect goes both ways. “Daryl and his team do a bang-up job,” Schlyer says. “One thing we like about Daryl is, he gets things done. That’s huge in this business, and it’s needed—you’ve got to push to get something done.”

Author: Ron Kotrba
Senior Editor, Biomass Magazine
218-745-8347
rkotrba@bbiinternational.com