|Bank Beneficial State Bank|
|Client Farm Power Northwest LLC|
|Location Skagit County, Washington, USA|
Kevin and Daryl Maas are natives of Skagit County of Washington state and grew up surrounded by dairy farmers in the area. As children, the brothers watched pressure from low milk prices and real estate development force family after family, sometimes close friends, out of business. They wondered if renewable energy might offer a way to sustain these small farms and help reverse a long-term trend in America: the loss of precious farmland and farmers.
In 2007, the Maas brothers met with dairy farmers and local dairy service businesses where nearly all agreed ‘digesters’ would provide essential solutions they needed. By spring of that year, Farm Power Northwest LLC was formed.
The Maas brothers are regarded as innovators and leaders in their sector, demonstrating the cutting edge possibilities of renewable energy technology and its potential advantages for dairy operators, business profitability, the environment, and communities.
The timing and economic environment was extremely challenging. Kevin and Daryl soon faced a chorus of rejections from the finance community, most of whom had no experience or interest in financing renewable energy projects. Despite much improved technology, American banks and many dairymen were skeptical about their value or longevity. While these beneficial systems could be found by the thousands all over Europe, by the end of 2007 there were less than a hundred across all of America.
Nonetheless, the opportunity to educate American farmers, developers and financiers regarding the value of these systems was enticing. The key seemed to be ‘community digesters’, where the dairy-business risk could be mitigated by a group of farms, while the benefits of a large and efficient digester could be spread across the same group. Other upsides included substantially reduced cost and price certainty for cow bedding, bacterial control, water quality, and opportunities for revenue sharing.
At the end of 2008, when the system of price controls for milk and related products collapsed, many small dairymen were unable to make a profit and left the industry. It was the smaller operators lucky enough to have a digester nearby who stood a much better chance of survival.
Today Farm Power owns and operates a fleet of five anaerobic digesters in the Pacific Northwest of the United States—working with fifteen farms, producing up to 4.25MW of renewable electricity.
As a triple bottom line lender, Beneficial State Bank is concerned about a number of trends including climate change and the deterioration of the American food system in favor of large industrial food providers. Lending opportunities that benefit multiple areas of the bank’s mission set, such as on-farm renewable energy systems, are of high value.
Beneficial State Bank was certain financing Farm Power’s initial project could be effectively and profitably deployed, and most of all was convinced the Maas brothers could ultimately be successful in their mission to help their neighbors and advance the renewable energy industry. This is an example of what the bank calls Beneficial Banking.