Stochastic Techno-Economic Analysis of Alcohol-to-Jet Fuel Production

This study assesses the alcohol-to-jet (ATJ) biofuel production pathway for three biomass feedstocks, and advances existing techno-economic analyses (TEA) of biofuels in three ways. First, we incorporate technical uncertainty for all by-products and co-products though statistical linkages between conversion efficiencies and input and output levels. Second, future price uncertainty is based on case-by-case time-series estimation. Third, breakeven price distributions are developed to present profitability at each price level. The stochastic dominance results show that sugarcane is the lowest cost feedstock over the entire range of uncertainty, followed by corn grain and switchgrass, with the mean breakeven jet fuel prices being $0.96/liter ($3.65/gal), $1.01/liter ($3.84/gal), and $1.38/liter ($5.21/gal), respectively. With a 75% profitability level, the breakeven prices for corn grain, sugarcane and switchgrass become $1.07/liter ($4.05/gal), $1.05/liter ($3.97/gal), and $1.53/liter ($5.81/gal), respectively. Sensitivity analyses show that technical uncertainty significantly impacts breakeven prices and NPV distributions.

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Conference Paper/ Presentation
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JEL Codes:
P47; Q16; Q42
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 Record created 2017-04-01, last modified 2018-01-23

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