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Dairy Green and Scandrett Rural owner and consultant John Scandrett has been overseeing a biogas conversion project at Glenarlea Farm, Isla Bank, since November 2016.
Glenarlea Farm, which is owned by the Fortuna Group and managed by Brendon and Lorelai Santos, milks about 900 cows at peak.
Bacteria convert effluent solids into biogas, of which methane and carbon dioxide are the main constituents.
The methane fuelled a converted diesel motor, which drove a generator to make electricity, Mr Scandrett said.
"This is the first time it has been done successfully in New Zealand using dairy shed effluent and has created a lot of interest among other dairy farmers.
"The farm owners save about $7.11 in electricity costs per hour from running the motor, although maintenance costs for the motor and ancillary equipment is $1.44 an hour."
Venture Southland, the Energy Efficiency and Conservation Authority, Niwa, Dairy Green and the Fortuna Group have provided support and funding for the project.
The effluent from the milking shed is pumped into a covered effluent pond and two types of bacteria get to work to make methane.
"One group of bacteria consumes the undigested fibre, changing it to fatty acids.
"A second group of bacteria eat the fatty acids and produce methane."
The methane is captured, filtered and used in a diesel motor, converted to spark ignition, to generate electricity and hot water.
The motor has heat exchangers that heat water, which is then used for plant and silo washes, as well as cooling the motor.
"The motor provides for loads up to 32kW of power an hour at the dairy shed and produces 1.5kW of hot water for each 1kW of electricity generated.
"When generating 32kW of electricity, it is generating 48kW of hot water.
The shed is also connected to the national grid if more than 32kW is required.
One of the by-products of making biogas is hydrogen sulphide, which is corrosive and can damage the motor, so the system has two treatment systems to remove it.
"Typically, the generator starts running from September 1 each year and can run for five to seven hours a day during the season to drying off.
"By capturing the methane and using it as a fuel, it captures the undesirable greenhouse gas and converts it to carbon dioxide in a carbon-neutral process and returns it back to the atmosphere.
"In the past three years, about 839 tonnes of carbon dioxide equivalent has been mitigated by using biogas as a fuel.
"At a carbon price of $25 per tonne, that equates to $4.60 an hour return.
"We don’t lose in fertiliser value from effluent either, as the liquid is returned to the land and has readily available nutrients still in the system."
Methane accounts for 43% of New Zealand’s gross emissions.