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Biomass Supply from Alternative Cellulosic Crops and Crop Residues: A Preliminary Spatial Bioeconomic Modeling Approach

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  • Egbendewe-Mondzozo, Aklesso
  • Swinton, Scott M.
  • Izaurralde, R. Cesar
  • Manowitz, David H.
  • Zhang, Xuesong

Abstract

This paper introduces a spatial bioeconomic model for study of potential cellulosic biomass supply at regional scale. By modeling the profitability of alternative crop production practices, it captures the opportunity cost of replacing current crops by cellulosic biomass crops. The model draws upon biophysical crop input-output coefficients, price and cost data, and spatial transportation costs in the context of profit maximization theory. Yields are simulated using temperature, precipitation and soil quality data with various commercial crops and potential new cellulosic biomass crops. Three types of alternative crop management scenarios are simulated by varying crop rotation, fertilization and tillage. The cost of transporting biomass to a specific demand location is obtained using road distances and bulk shipping costs from geographic information systems. The spatial mathematical programming model predicts the supply of biomass and implied environmental consequences for a landscape managed by representative, profit maximizing farmers. The model was applied and validated for simulation of cellulosic biomass supply in a 9-county region of southern Michigan. Results for 74 cropping systems simulated across 39 sub-watersheds show that crop residues are the first types of biomass to be supplied. Corn stover and wheat straw supply start at $21/Mg and $27/Mg delivered prices. Perennial bioenergy crops become profitable to produce when the delivered biomass price reaches $46/Mg for switchgrass, $118/Mg for grass mixes and $154/Mg for Miscanthus giganteus. The predicted effect of the USDA Biomass Conversion Assistance Program is to sharply reduce the minimum biomass price at which miscanthus would become profitable to supply. Compared to conventional crop production practices in the area, the EPIC-simulated environmental outcomes with crop residue removal include increased greenhouse gas emissions and reduced water quality through increased nutrient loss. By contrast, perennial cellulosic biomass crops reduced greenhouse gas emissions and improved water quality compared to current commercial cropping systems.

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Bibliographic Info

Paper provided by Michigan State University, Department of Agricultural, Food, and Resource Economics in its series Staff Papers with number 98277.

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Date of creation: Dec 2010
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Handle: RePEc:ags:midasp:98277

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Postal: Justin S. Morrill Hall of Agriculture, 446 West Circle Dr., Rm 202, East Lansing, MI 48824-1039
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Web page: http://www.aec.msu.edu/agecon/
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Keywords: biomass production; bioenergy supply; biofuel policy; bioenergy; cellulosic ethanol; agro-ecosystem economics; ecosystem services economics; agro-environmental trade-off analysis; mathematical programming; EPIC; Agricultural and Food Policy; Crop Production/Industries; Environmental Economics and Policy; Land Economics/Use; Production Economics; Resource /Energy Economics and Policy; Q16; Q15; Q57; Q18;

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  1. Paul Gallagher & Mark Dikeman & John Fritz & Eric Wailes & Wayne Gauthier & Hosein Shapouri, 2003. "Supply and Social Cost Estimates for Biomass from Crop Residues in the United States," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 24(4), pages 335-358, April.
  2. Wallace E. Tyner & Farzad Taheripour, 2007. "Renewable Energy Policy Alternatives for the Future," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 89(5), pages 1303-1310.
  3. Argyris Kanellopoulos & Paul Berentsen & Thomas Heckelei & Martin van Ittersum & Alfons Oude Lansink, 2010. "Assessing the Forecasting Performance of a Generic Bio-Economic Farm Model Calibrated With Two Different PMP Variants," Journal of Agricultural Economics, Wiley Blackwell, vol. 61(2), pages 274-294.
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Cited by:
  1. Moon, Jin-Young & Apland, Jeffrey & Folle, Solomon & Mulla, David, 2014. "Environmental Impacts of Cellulosic Feedstock Production: A Case Study of a Cornbelt Aquifer," Staff Papers 164139, University of Minnesota, Department of Applied Economics.

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