Recognizing the potential for environmental and economic benefits through renewable energy, Fair Oaks Farms in Fair Oaks, Indiana, is producing more than milk from its 11,000 dairy cows. The dairy’s anaerobic digester generates approximately 865 million BTUs of renewable natural gas each day.

There was more to be done, however, to further reduce the operation’s carbon footprint while addressing the significant costs of fossil fuels used to transport their products.

Through its Business and Industry Loan Guarantee Program in fiscal year 2013, USDA Rural Development backed a $5.5 million loan to Renewable Dairy Fuels, an affiliate of Fair Oaks Farms. The financing was used purchase machinery and equipment to convert methane gas from the dairy’s digester into renewable compressed natural gas (CNG) and to install a fueling station with gas drying, compressing and dispensing operations. The equipment scrubs the biogas clean of carbon dioxide so that it can be used as a clean transportation fuel.

The CNG generated by the dairy’s main waste product, animal manure, now powers Fair Oaks Farms’ fleet of big rigs hauling milk to processing plants in Indianapolis, as well as Murphysboro, Tennessee, and Winchester, Kentucky.

The waste-to-energy project saves over 1.5 million gallons of diesel fuel per year, trimming the company’s fuels costs and carbon emissions significantly.