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Abstract
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.