Oct 31 - McClatchy-Tribune Business News Formerly Knight Ridder/Tribune Business News - Matt Christensen The Times-News, Twin Falls, Idaho,

There's a cash cow in the dairy industry, and it isn't milk.

It's manure, and Russ Davis, president of Organix Inc., a Washington state-based solid-waste company, wants to cash in.

Organix announced Monday it has completed a pilot program at Whitesides Dairy near Rupert that proved dairies can get rid of all their waste in an environmentally friendly way and make money at the same time.

Magic Valley is at the forefront of a technological revolution that could forever change the way dairies dispose of waste, utility companies obtain natural gas and homeowners grow flowers, Davis said.

"To some extent," he said, "we've uncovered a gold mine."

Davis said Organix developed a technique that turns solid waste from anaerobic digesters --machines that transform cow manure into valuable methane gas --into a peat moss-like substance that can be sold to nurseries, landscape companies, soil blenders and homeowners.

One problem: There is only one digester in Magic Valley --at Whitesides Dairy.

It was built about two years ago by Idaho-based Intrepid Technology and Resources as a prototype and runs at a cost of about $1,000 per cow.

The project has worked well, though. The Whitesides prototype was the first American digester to produce pipeline-grade methane gas, the main component of natural gas.

Intrepid and Organix say that every dairy in Magic Valley could someday eliminate its waste problem and make money from methane gas and the peat moss substitute.

Intrepid is expanding at Whitesides from five methane tanks to 10 to accommodate more cows. After updates, the plant will go from using 30 percent of the dairy's waste to 100 percent.

Intermountain Gas Co. will buy methane from the updated Whitesides project for its Magic Valley customers.

Another Intrepid digester plant is scheduled to open near Wendell in the next several weeks.

Davis' company, which specializes in agriculture compost, teamed up with Intrepid about a year ago. Using the Intrepid digester, Organix engineered a machine that turns the digester's solid-waste byproduct into a peat moss-like substance.

A dairyman using the Intrepid digester and the Organix moss machine can eliminate his operation's waste entirely, leaving only irrigation-quality water as a byproduct.

Davis said Organix has received letters from national companies that want to buy the peat moss substitute --a product that Davis said is better than the real thing because it contains more nutrients for about the same cost.

He won't say how much the moss attachment will cost dairymen until Organix finalizes its business plan.

But unless more dairymen invest in digesters, Organix --and the national companies --will have to wait.

Still, Davis remains optimistic.

"We were hoping for the best," he said. "I think we got it."

Times-News staff writer Matt Christensen covers natural resources. Contact him at 735-3243 and at matt.christensen@lee.net.