IMO D.
(A) farmers’ houses could be heated by the warmth from cows’ milk, according to one agricultural engineer
-incorrect construction. Should start with "According to one ..."(B) the warmth from cows’ milk could be used by farmers to heat their houses, according to one agricultural engineer
-incorrect construction. Should start with "According to one ..."(C) one agricultural engineer reports that farmers could use the warmth from cows’ milk to heat their houses
-Sounds like the agricultural engineer has installed special electric pumps.(D) farmers, according to one agricultural engineer, could use the warmth from cows’ milk to heat their houses
-correct. Farmers placed close to modifier "By installing electric pumps..". Its the farmers who have installed these pumps. Also, the report of engineer is correctly placed after "according to ...."(E) one agricultural engineer reports that farmers’ houses could be heated by the warmth from cows’ milk
-Sounds like the agricultural engineer has installed special electric pumps.
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