Environmental Efficiency Among Corn Ethanol Plants
AbstractEconomic viability of the US corn ethanol industry depends on prices, technical and economic efficiency of plants and on continuation of policy support. Public policy support is tied to the environmental efficiency of plants measured as their impact on emissions of greenhouse gases. This study evaluates the environmental efficiency of seven recently constructed ethanol plants in the North Central region of the U.S., using nonparametric data envelopment analysis (DEA). The minimum level of GHG emissions feasible with the available technology is calculated for each plant and this level is used to decompose environmental efficiency into its technical and allocative sources. Results show that, on average, plants in our sample may be able to reduce GHG emissions by a maximum of 6% or by 3,116 tons per quarter. Profit maximizing input and output allocations are also found based on observed prices. The environmentally efficient allocation, the profit maximizing allocation, and the observed allocation for each plant are combined to calculate shadow cost of reducing greenhouse gas emissions. These shadow costs gauge the extent to which there is a trade off or a complementarity between environmental targets and profits. Results reveal that, at current activity levels, plants may have room for simultaneous improvement of environmental efficiency and economic profitability.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Agricultural and Applied Economics Association in its series 2010 Annual Meeting, July 25-27, 2010, Denver, Colorado with number 61650.
Date of creation: 2010
Date of revision:
Contact details of provider:
Postal: 555 East Wells Street, Suite 1100, Milwaukee, Wisconsin 53202
Phone: (414) 918-3190
Fax: (414) 276-3349
Web page: http://www.aaea.org
More information through EDIRC
ethanol; data envelopment analysis; life-cycle emissions; environmental efficiency; shadow prices; Resource /Energy Economics and Policy;
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Wamisho, Kassu, 2012. "The Shadow Price of GHG Reduction in Corn Ethanol Plants," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124719, Agricultural and Applied Economics Association.
- Wamisho, Kassu, 2012. "The Shadow Price of GHG Reduction in Corn Ethanol Plants," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126862, International Association of Agricultural Economists.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search).
If references are entirely missing, you can add them using this form.