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Carbon Emissions, Renewable Electricity, and Profits: Comparing Policies to Promote Anaerobic Digesters on Dairies

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Author Info

  • Key, Nigel D.
  • Sneeringer, Stacy E.

Abstract

Anaerobic digesters can provide renewable energy and reduce greenhouse gas emissions from manure management. Government policies that encourage digester adoption by livestock operations include construction cost-share grants, renewable electricity subsidies, and carbon pricing (offset) programs. However, the effectiveness and efficiency of these policies is not well understood. For the U.S. dairy sector, we compare predicted digester adoption rates, carbon emission reductions, renewable electricity generation and sales, and net returns and social benefits of several policies. We find that a carbon pricing policy provides the greatest net social benefit for a range of assumptions about the benefits of carbon reductions and renewable energy.

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File URL: http://purl.umn.edu/132525
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Bibliographic Info

Article provided by Northeastern Agricultural and Resource Economics Association in its journal Agricultural and Resource Economics Review.

Volume (Year): 41 (2012)
Issue (Month): 2 (August)
Pages:

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Handle: RePEc:ags:arerjl:132525

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Web page: http://www.narea.org/
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Related research

Keywords: anaerobic digester; carbon offsets; climate change; dairy; methane; renewable electricity; subsidy; Agricultural and Food Policy; Environmental Economics and Policy; Farm Management; Livestock Production/Industries; Research and Development/Tech Change/Emerging Technologies; Resource /Energy Economics and Policy;

References

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  1. Clark P. Bishop & C. Richard Shumway, 2009. "The Economics of Dairy Anaerobic Digestion with Coproduct Marketing," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 31(3), pages 394-410, 09.
  2. William F. Lazarus & Margaretha Rudstrom, 2007. "The Economics of Anaerobic Digester Operation on a Minnesota Dairy Farm," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 29(2), pages 349-364.
  3. Key, Nigel D. & Sneeringer, Stacy E., 2011. "Carbon Markets and Methane Digesters: Potential Implications for the Dairy Sector," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 43(04), November.
  4. Brent A. Gloy, 2011. "The Potential Supply of Carbon Dioxide Offsets from the Anaerobic Digestion of Dairy Waste in the United States," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 33(1), pages 59-78.
  5. Leuer, Elizabeth R. & Hyde, Jeffrey & Richard, Tom L., 2008. "Investing in Methane Digesters on Pennsylvania Dairy Farms: Implication of Scale Economies and Environmental Programs," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 37(2), October.
  6. Key, Nigel D. & Sneeringer, Stacy E., 2011. "Climate Change Policy and the Adoption of Methane Digesters on Livestock Operations," Economic Research Report 102758, United States Department of Agriculture, Economic Research Service.
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