Iowa company will convert cow manure into natural gas. But is it an environmental asset or hazard?

MONONA, Ia. — Tammy Thompson, the mother of two young boys, fears the worst when she looks out at the 10,000-head cattle feedlot and biogas operation that’s moving in next door to her home in northeast Iowa.

She’s worried the project's 39-million-gallon lagoon will leak, polluting her and her neighbors’ wells.

She’s concerned about odor, insects and disease that could spread from the feedlot to her family’s dairy farm a few miles away.

Most frightening for Thompson is that natural gas, converted from methane coming off the cattle's manure, could leak and explode.

"I feel like it's just a waiting game," Thompson said. "We’re waiting until something bad happens."

But developers of the $30 million project say it is environmentally friendly, reducing waste going to Iowa landfills and generating renewable energy that cuts the carbon contributing to climate change.

Those gains, however, aren’t enough to overcome environmentalists’ misgivings.

Opponents say the state is failing to follow its own rules for protecting a nearby cold-water trout stream called Bloody Run Creek, one of 34 streams and lakes specially designated as "Outstanding Iowa Waters."

Chief among their contentions: The massive earthen lagoon should be prohibited in a region that's riddled with sinkholes and underground caves.

Steve Veysey, a Hawkeye Fly Fishing Association board member, said the state is doing little to safeguard Bloody Run Creek.

"If we can't say, 'No, we don’t think you should do this in this area,' then forget it. Game over. There’s no control. It’s the Wild West. We’re not going to protect our Outstanding Iowa Waters," Veysey said.

Bill Ehm, who leads the Iowa DNR's environmental services, said the agency is concerned about Bloody Run Creek as well.

"It's a high-quality resource water, and there has been significant investment in the stream. We want it to stay that way," Ehm said.

"That’s why we’re working with applicants to make sure they’re doing things right," he said.

It's an energy, not animal, project

Even with 10,000 cattle at a time cycling through the Monona cattle lot, the operation's focus is generating renewable natural gas that will be used to power trucks and cars, says Jon Haman, Walz Energy's chief operating officer.

"It's a point that gets lost in discussions about the project," said Haman, who adds that the facility will convert manure and food that is unfit for people or animals into energy.

"There are positive environmental impacts," Haman said. "I think we'll help maintain Iowa's waters and improve" them.

First of all, the project will divert "hundreds of metric tons of materials" from going into landfills, Haman said.

Since the renewable natural gas has "90 percent fewer carbon emissions than conventional diesel," it's equivalent to taking 16,000 passenger cars off the road each year, Haman said.

Iowa’s Energy Plan, released nearly a year ago, said the state could support about 1,000 more biogas projects.

Here's how the Monona project will work:

Walz Energy plans to custom-feed 1,680 cattle in each of six partially enclosed open feedlots. "We'll be the hotel, the inn-keeper, the caregiver," Haman said.

All the manure will be captured under the cattle in 2-foot deep manure pits "that will be flushed at least twice a day," Haman said.

The manure will be mixed with feed and food waste, which will get pumped directly into storage tanks before getting mixed into six,1.5-million-gallon anaerobic digesters.

"Anything that stinks makes gas," Haman said.

Micro-organisms will break down the waste, and the methane will be pulled off, converted into natural gas, and pushed through existing underground pipes to end-users.

What's left over — called digestate — will be stored in the operation's 39-million-gallon open lagoon. Each fall the liquid fertilizer will be applied to farmland.

The project is getting no state or federal tax credits, grants or loans, said Haman, whose partners include Feeder Creek Group, where he's also COO, and Monona area brothers Mike and Dean Walz, and Jared Walz, Mike’s son.

"Nobody believes me, but the operation doesn't smell," Haman said, adding that he can control levels within the lagoon during heavy rains with "a push of a button" on his smartphone.

A creek runs through it

Paul Rasmussen's Spook Cave & Campground near McGregor is empty in November.

He and his wife, Paula, bought the recreation venue in 2002. They host about 400 people a weekend on 90 acres, mostly nestled along Bloody Run Creek.

Each year, about 15,000 people float through Spook Cave, a cavern that's fed by a natural spring.

Its name came from the eerie sound that escaped a hole in the cavern before the first owner blasted the face open, revealing the rocky underworld, Rasmussen said.

During the winter, the spring that carved out the cave runs unhindered to Bloody Run.

During the summer, Rasmussen closes a dam above the creek, filling the cave and enabling visitors to explore it by boat.

A few feet away, Beulah Falls springs from the side of a limestone cliff and is typically filled with kids climbing around it most warm days, said Rasmussen, who employs 21 seasonal workers.

Shallower spots in the creek give kids a place to fish for minnows, hunt for bugs and play.

The couple, who've built log cabins and added hiking and four-wheeler trails, among other improvements, are worried about a possible manure leak at the Walz Energy project, about 5 miles southwest of them.

The couple supply drinking water from two wells on the property to campers, and stock fish in a campground pond that also gets used for swimming and kayaking.

"If the water was polluted, it would be devastating to our business," Rasmussen said.

National treasure or development roadblock?

Many of the Spook Cave campground visitors are anglers who spend time fishing for trout in Bloody Run and dozens of other pristine creeks that fill the hilly region, Rasmussen said.

In 2009, Iowa environmental leaders adopted rules that designated 34 streams and lakes as "Outstanding Iowa Waters."

About 930 people wrote to the Iowa Environmental Protection Commission or came to one of 13 meetings.

Some residents thought the added watershed protections would hinder cities' and towns' growth, add unneeded regulations and hurt economic development.

Others said the state should take aggressive action to protect the state's most important waters, "national treasures" that yearly attract thousands of tourists, have brought family members back to Iowa and create outdoor havens for anglers, hunters and hikers.

The final list was whittled to nearly 120 miles of mostly cold-water trout streams and about 9,530 acres in West Okoboji and Big Spirit lakes.

The state said the added protection "recognizes and attempts to preserve Iowa’s truly remarkable surface water resources."

Last year, Chuck Gipp, Iowa's DNR director, said the recovery of Iowa's "iconic trout streams" had "improved to allow for natural trout reproduction in 45 streams."

"That’s up from 32 streams in 2007 and just six in 1980," he wrote last year. "That’s good news for tourism in those communities, too."

Enough safeguards?

Vesey, the Hawkeye Fly Fishing Association board member, said Walz Energy seems to have bypassed safeguards to protect Iowa residents and its natural resources.

Even though the project operates much like a pig confinement — the six cattle buildings each have three sides, meaning they are treated like open feedlots — it avoids separation distance requirements from residents and going to county leaders for consideration.

"The process doesn’t seem to be providing special protection to an Outstanding Iowa Water," Vesey said. "It’s a process that makes sure what agribusiness wants to do, gets done."

The state has required Walz Energy to get an "individual" stormwater pollution prevention permit, which it has yet to grant.

State code requires developers to have the permit before moving dirt, said Clare Kernek, an Iowa Environmental Council attorney.

But construction has been underway for at least nine months.

Eric Wiklund, an Iowa DNR official, said a permit doesn't prevent developers "from constructing; it prevents them from discharging."

"Technically if someone is constructing, and exceeding one acre but in an area in a flat field where there is no potential for runoff, you wouldn’t necessarily have to have a permit," said Wiklund, supervisor of DNR's National Pollution Discharge Elimination System division.

Walz already has had one illegal discharge, when a heavy rainstorm washed sediment into Bloody Run in October.

Haman said the company quickly corrected the problems.

Wiklund said the state has yet to decide what action, if any, will be taken because of the violation.

Topography presents risks

Kernek said state rules prohibit animal feeding operations from building earthen lagoons in northeast Iowa's karst topography, where water can work through limestone, gypsum and other rocks, creating underground caves and sinkholes.

The fractured rocks also can give manure and other pollutants a direct path to surface and groundwater.

Yet Iowa DNR issued a permit for Walz's 39-million-gallon lagoon.

"It’s very confusing" that the state "isn't enforcing its own rules," said Kernek, whose group is pushing to stop construction.

Ehm, the DNR leader, said Walz sought the lagoon permit through the state’s wastewater division, not through animal feeding operation rules.

But Kernek said that doesn't lift the animal feeding requirements.

Susan Heathcote, the council's water program director, said the state has broader authority to protect Bloody Run and other Outstanding Iowa Waters from degradation.

The agency can make "case-by-case decisions about what activity should be allowed in the protected watershed," Heathcote said. "They have more authority here than they would any other place.

"It doesn’t set a good precedent for development of this type in other protected watersheds," she said. "We’re very concerned ... and really believe that DNR needs to respond with more aggressive enforcement action."

'You don't know where it goes'

Haman said Walz Energy has taken "literally hundreds of soil borings," checking for the possibility of karst conditions.

And state experts have reviewed the results. "They're confident we're in a good spot," he said. "If they didn't believe it, they wouldn't have given us our permit."

The permit requires Walz to have 2 feet of compacted clay as a liner — a foot more than typically required, Ehm said.

But the state mandates that lagoons in karst regions be made out of concrete or other "formed" materials to protect area watersheds, Heathcote said.

Haman said developers looked at building a concrete lagoon. "But working with the engineers at the (DNR) wastewater department, all of us came to the conclusion" that the site could support the lagoon.

"We're exceeding requirements for municipal sewage lagoons," he said.

Heathcote points to Garnavillo, a small town south of Monona that built three sewage lagoons in the 1980s.

Testing them, officials let stormwater pool in one, which developed a sinkhole over a weekend.

Two of the three lagoons were abandoned.

Larry Stone, a retired Des Moines Register outdoors writer, points out a site near trees on the edge of Walz Energy's 40-acre site.

It's a sinkhole that's become overrun with trees. It's a familiar site across the area, particularly in the steeply rolling farm fields, said Stone, providing a Monona area tour.

A few years ago, dye was put into the water that flowed into the area's fractured rocks. The dye showed up about 6 miles away 23 hours later.

"You don't know where it goes," Stone said. "You don't know who all will be affected" if manure leaks at Walz.

An unwelcome neighbor

Thompson, who lives next door to Walz's cattle and biogas development, says it's an industrial project that has no business locating next door to the family's home.

The mother of 5- and 9-year-old boys, Thompson also is worried about leaking biogas — toxic and highly explosive — even with Haman's reassurance that sensors will be used to detect leaks.

"There are several fail-safes, so you could shut different routes from different digester vessels and isolate leaks with a series of valves," the developer says.

"And if there ever was a leak, we'll divert it to the flare and it will be burned off," he said.

Thompson and her husband, Jasen, also fear airborne animal disease from the feedlot could infect her family's eight dairy calves that they raise at their home.

The family's nearly 40-cow dairy is a few miles away.

Thompson said the state's rules protect businesses, not families.

"I've just been angry and frustrated," she said. "There's nothing proactive the state can do to protect us."

Outstanding Iowa Water

Bloody Run Creek was the ninth-most-fished stream in Iowa last year, with nearly 19,000 anglers, 20 percent more than five years earlier, the Iowa Department of Natural Resources said. It ranked 12th in 2011.

The state has spent nearly $1.4 million helping restore the creek's health since 2005. The creek supports wild brown, brook and rainbow trout.

The DNR estimates visitors spent about $833,300 in the region in 2016.

Larry Stone stopped at Bloody Run County Park earlier this month near McGregor. It's nestled in a deep valley, where Stone brings his grandchildren to fish for trout.

The retired Register outdoors writer says the park is a hot spot for fishing, picnicking, hiking, bird-watching and leaf-viewing in the fall.

Walz Energy, he said, endangers the clear, clean waters.

"With 20,000 cattle running through the operation a year, there's a lot that can go wrong," Stone said, adding that the facility would move animals in and out twice a year.

"With that amount of manure, I can't fathom what it could do to the watershed."

Iowa ranks high for biogas potential

Iowa has the potential for about 1,140 new biogas projects, based on the estimated amount of available organic material in the state, according to the Iowa Energy Plan, released nearly a year ago.

The state ranked eighth nationally for "methane production potential for biogas sources," it said.

If all the projects were developed, construction would generate $3.4 billion in capital investment, and create 28,500 short-term construction jobs, the report said.

The projects would created 2,280 long-term jobs along with hundreds of indirect jobs.

These biogas systems could have the ability to produce enough electricity to generate 1.8 billion kilowatt-hours or enough energy to power 158,722 homes each year, it said.

The Monona project, which will employ 18, will be used to develop natural gas that's used in trucks and cars.