95% of Dairy Farms Did Not Expand Herds Because of Digesters

Ninety-five percent of U.S. dairy farms with anaerobic digesters did not increase herd size because of the technology, according to a peer-reviewed Cornell survey that challenges recent claims linking digester growth to industry consolidation.

The study (Wehner et al., 2026, JDS Communications 7(6): 765-770) surveyed producers who operate digesters about their adoption decisions and future farm investments. Of 352 surveys delivered, 64 came back — an 18 percent response rate representing 15.8 percent of the dairy digesters listed in the U.S. EPA AgSTAR database.

The work comes out of the Cornell Dyson School of Applied Economics with Cornell CALS PRO-DAIRY specialists, funded by the Environmental Defense Fund. It responds directly to news coverage suggesting that a decade of digester adoption may have encouraged the expansion of fewer, larger dairy operations — a hypothesis the authors note had not been well documented.

What drives herd expansion, if not digesters?

Producers ranked expected dairy business profit as the most important factor in herd expansion decisions, followed by the interests of the next generation and labor availability. Digester net revenues played little to no role. Respondents distributed 100 percent across six factors — expected profit, next generation interests, labor availability, management capacity, digester net revenues and interest rates — with profit at the top of the weighting.

The respondent pool skews toward large, productive operations. Annual milk production per cow among respondents averaged 28,196 pounds, nearly 15 percent above the U.S. average, consistent with higher productivity on larger dairy farms. All digester types and biogas utilization pathways were represented, and 19 percent of systems co-digested other feedstocks with manure. Just over half — 52 percent — of the systems are managed or operated by a third party, and most of those were installed in 2017 or later. Average digester age was 10 years.

Where does the money come from?

Cost share remains the decisive variable. A majority of producers rated cost share as highly important, and it covered an average of 57 percent of digester project costs, with a standard deviation of 36 percent. Total median project cost fell between $1,000 and $1,999 per cow.

Markets for digester products ranked nearly as high, especially for new systems:

• Low carbon fuel standards
• The Federal Renewable Fuel Standard (RIN credits)
• Carbon credits

Odor control, revenue diversification and regulatory uncertainty ranked just below the financial metrics. Pipeline proximity mattered less. Labor availability ranked as far more important for new digester adoption than for running current operations.

The data also show a scale effect in how biogas leaves the farm. A statistically significant positive correlation between larger herd size and renewable natural gas (RNG) production for off-farm sale suggests larger operations favor biogas-to-RNG pathways over biogas-to-electricity. Most dairy manure digesters generate more biogas energy than the farm uses, so some off-farm use occurs regardless of the pathway.

What changes for farms and policy?

Nearly half of respondents — 44 percent — plan to reinvest in or construct new anaerobic digester infrastructure. The authors conclude that investment could grow with effective capital cost share programs for both new and existing systems, paired with markets offering long-term price certainty for digester products and services.

That matters most for small and medium-sized farms, where the technology is available but financial feasibility is harder to reach. For context, a median-cost project at $1,000 to $1,999 per cow means a 500-cow dairy faces roughly $500,000 to $1 million in capital outlay before the 57 percent average cost share offsets part of it.

The stakes extend beyond the farm gate. The paper arrives amid active policy fights over biogas: groups petitioned USDA in January 2026 to block manure digesters on factory farms from clean energy funds, while other coverage has pitched dairy manure as a potential data center fuel. Against that backdrop, the survey's core finding — digesters follow herd size rather than drive it — gives regulators and lenders a data point they have lacked.

Cornell's team is continuing to gather first-hand producer experience, offering $50 for participation in small group conversations with dairy operators running digesters.

With 44 percent of surveyed operators planning new digester investment, the near-term question is whether cost share programs and long-term energy markets keep pace with demand.