Farm Biogas Profitability: How to Run the Numbers

A farm biogas plant, especially a small manure plant under section 44 of the German Renewable Energy Sources Act (EEG), can be profitable if there is enough manure for high utilisation, the investment stays within limits and the heat is put to good use. At 75 kW rated output, the EEG payment works out at around 141,000 euros of electricity revenue a year. Whether a surplus remains after debt service, maintenance, own power use and labour comes down to a few key factors. You can test your own figures with the biogas calculator.

Electricity revenue

Electricity revenue follows from rated output (Bemessungsleistung) and the reference value (anzulegender Wert). Rated output is the annual electricity generated divided by the hours in the calendar year. A plant generating 657,000 kWh a year therefore has a rated output of 75 kW, regardless of the installed size of the combined heat and power (CHP) unit.

For small manure plants, section 44 EEG sets a reference value of 22 cents per kWh up to 75 kW and 19 cents per kWh up to 150 kW rated output. Because of the annual 0.5 per cent reduction under section 44a EEG, the values for commissioning from 1 July 2026 work out at around 21.67 and 18.72 cents per kWh. Operators who choose the fixed feed-in tariff instead of direct marketing receive 0.2 cents per kWh less.

Above 75 kW the value is calculated pro rata. At 100 kW rated output, for example, the blended value is around 20.93 cents per kWh (three quarters at 21.67 cents, one quarter at 18.72 cents). More on this in the guide to the small manure biogas plant.

The way you sell electricity also affects the result. Up to 100 kW installed capacity you can choose the fixed feed-in tariff: the grid operator pays you the value minus 0.2 cents per kWh directly. Above that, direct marketing is mandatory. A direct marketer sells the electricity on the exchange, the market premium (Marktprämie) makes up the difference to the reference value, and the direct marketer charges a fee for this. The plant must also be remotely controllable. Many small manure plants therefore keep their installed capacity just below 100 kW.

Electricity you use yourself receives no EEG payment but replaces expensive grid purchases. Whether self-consumption pays off depends on your electricity price, the farm’s load profile and the metering concept agreed with the grid operator.

Revenue and benefit from heat

Alongside electricity, a CHP unit produces roughly the same amount of heat or slightly more. Part of it heats the digester, considerably more in winter than in summer. The remaining heat only has value if you use it:

• farmhouse and retirement cottage: replaces heating oil, gas or pellets
• livestock buildings, milking parlour, calf or piglet areas: replaces electricity or fossil fuels
• drying grain, timber or wood chips
• selling to neighbours via a small heat network

Value heat you use yourself at the fuel costs avoided, and heat you sell at the agreed price minus network losses. The guide to biogas heat use describes how to integrate heat sensibly.

Costs: capital, operation and labour

The investment cost of a small manure plant covers the digester, gas storage, CHP unit, pumps and agitators, controls, grid connection, planning, permits and, where needed, a new digestate store. How these items add up is explained in the guide to biogas plant costs.

Running costs fall into five groups:

1. Debt service: interest and repayment, usually calculated over the 20-year EEG term.
2. Maintenance and repairs: mainly the CHP unit with oil changes, spark plugs and major overhaul, plus pumps, agitators and gas storage.
3. Own power use: agitators, pumps, solids feeding and controls need electricity that is either bought in or deducted from your own generation.
4. Labour: daily checks, the operating log, fault clearance and spreading digestate.
5. Other: insurance, inspections by experts, environmental verifiers, metering, accounting and, with direct marketing, the direct marketer’s fee.

The manure itself usually costs nothing if it comes from your own livestock. If other feedstocks such as solid manure or feed residues are used, their cost and transport must be included.

Do not forget reserves for major repairs. A CHP engine needs a major overhaul or replacement after some tens of thousands of operating hours, and agitators, pumps and gas storage membranes have a shorter life than tanks and buildings. Spread these costs evenly over the years in your calculation rather than only accounting for them when something breaks. For cash flow in the first year, bear in mind that after start-up the plant needs several weeks to months before the biology is stable and full gas production is reached.

Slurry and digestate storage

Digestion hardly reduces the volume of slurry. You therefore still need storage capacity for the closed periods under the German Fertiliser Ordinance (Düngeverordnung), as a rule at least six months. If a new digestate store is built, the EEG generally requires a technically gas-tight cover and a minimum retention time in the gas-tight system. Plants using manure exclusively are exempt from this requirement.

Check whether existing slurry tanks can still be used and whether covering a store would increase gas yield. Freshly digested slurry also behaves differently when spread; see the guide to digestate as fertiliser.

Example calculation and sensitivities

The following calculation shows a small manure plant with 75 kW rated output, the fixed feed-in tariff and commissioning in the second half of 2026. All cost figures are illustrative assumptions, not market prices:

A simple sensitivity check, changing only one value at a time, shows how fragile this result is:

The biggest levers are therefore utilisation and construction cost. A plant that only reaches 65 instead of 75 kW rated output because there is too little or too thin manure loses a large part of its surplus. Work with a cautious estimate of manure volumes and do not derive gas yield from table values alone.

How to approach the assessment

First record the manure actually produced over a year, by species, and decide how the herd is expected to develop over the next 20 years. Then run a first pass in the biogas calculator. If the results stay positive even in the unfavourable case, obtain quotes with a comparable scope and have an independent party check the profitability calculation. Suitable specialists are listed in the directory under planning and engineering.

Involve your tax adviser early as well. The example above is a pre-tax calculation. Whether the plant belongs to the agricultural business or is run as a separate commercial business, which legal form makes sense and how depreciation is spread all affect the after-tax result and cash flow in the first years.