Feasibility of an Adaptable Biorefinery Platform: Addressing the Delivery Scale Dilemma under Drought Risk

Conversion of biomass to electricity is often not economically feasible as a result of large transportation costs and low output prices. We build a model of an adaptable biorefinery situated at an agri-processing facility that already has biomass on-site and consider the optimal scale of the plant to achieve a price premium by selling peaking power given uncertain biomass deliveries year over year as a result of climatic variability. We find that, for conservative electricity prices, a plant situated near cotton gins in Texas could operate with positive expected net revenue while converting on average only 38% of available biomass for peak electricity prices.


Editor(s):
Bosch, Darrell J.
Marchant, Mary A.
Issue Date:
2014-02
Publication Type:
Journal Article
PURL Identifier:
http://purl.umn.edu/169041
Published in:
Journal of Agricultural and Applied Economics, Volume 46, Number 1
Page range:
57-71
Total Pages:
15
JEL Codes:
Q4; Q16




 Record created 2017-04-01, last modified 2017-08-27

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