Economic and Environment Effects of Rice-Straw Bio-Ethanol Production in Vietnam

The bio-ethanol (BE) production from rice-straw is carbon neutral and less competitive with food supply. To facilitate the rice-straw BE production, economic and environmental evaluation is needed with consideration of its life-cycle period, i.e. plant construction phase, BE production phase and scrapping phase of the plant. The present study aims to show such effects of rice-straw BE production as called the second generation BE production in Vietnam where huge amount of unused rice straw is produced. It also considers three different technology scenarios, such as the present technology, advanced technology in which economies of scale realize and innovative technology in which new production method is used. The results demonstrated that, first, rice-straw BE production can reduce 23% of annual gasoline consumption and its investment for plant construction corresponds to 8 to 22% of annual investment in Vietnam. Second, total induced production during life-cycle period (LCP) was smaller than life-cycle cost (LCC) under the present technology. However, the advanced technology and innovative technology made the LCP bigger than LCC, producing net benefit in BE production. Third, BE production under the present technology emitted more GHG than the reduction amount from gasoline consumption replaced by BE. However, the advanced and innovative technology reduced the life-cycle GHG emissions in a whole. From these results, technological progress in rice-straw BE production is highly needed, because BE production under the present technology was hardly acceptable from economic and environment point of view. The Vietnamese government and the developed countries, such as Japan, should support to encourage research and development project. Also, post Kyoto protocol should take BE production into account to give some merits to developing countries which participate in this scheme.