Stochastic viability of second generation biofuel chains: Micro-economic spatial modeling in France
AbstractTo better understand the production of biofuels derived from lignocellulosic feedstock, we investigate the interplay between the agricultural sector and a biofuel facility, at the local level. More specifically, we investigate the economic and technological viability of a bioenergy facility over time in an uncertain economic context using a stochastic viability approach. Two viability constraints are taken into consideration: the facility's demand for lignocellulosic feedstock has to be satisfied each year and the associated supply cost has to be lower than the facility's profitability threshold. We assess the viability probability of various strategies the facility can adopt to ensure that the agricultural sector meets its demand for biomass. These supplying strategies are determined at the initial time and define the constant share of total demand met by contracting out the demand to farmers who grow perennial crops. Any remaining demand is met by annual crops or wood. The demand constraints and agricultural price scenarios over the time horizon are introduced in an agricultural and forest biomass supply model, which in turns determines the supply cost per unit of energy and computes the viability probabilities of the supplying strategies. If a facility is to be viable over time, it is best for it to ensure that 100% of its demand is contracted out to farmers supplying perennial dedicated crops. This result is robust to the price context.
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 INRA, Economie Publique in its series Working Papers with number 2013/02.
Date of creation: 13 Jun 2013
Date of revision:
Contact details of provider:
Postal: BP 01, 78850 Thiverval Grignon
Phone: 01 30 81 53 30
Fax: 01 30 81 53 68
Web page: http://www4.versailles-grignon.inra.fr/economie_publique_eng
More information through EDIRC
Biofuel; biomass production; spatial economics; stochastic viability; Monte Carlo simulation;
Other versions of this item:
- Bamiere, Laure & Martinet, Vincent & Gouel, Christophe & Le Cadre, Elodie, 2011. "Stochastic Viability of Second Generation Biofuel Chains: Micro-economic Spatial Modeling in France," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114238, European Association of Agricultural Economists.
- Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
- Q16 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - R&D; Agricultural Technology; Biofuels; Agricultural Extension Services
- Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
This paper has been announced in the following NEP Reports:
- NEP-AGR-2013-07-05 (Agricultural Economics)
- NEP-ALL-2013-07-05 (All new papers)
- NEP-ENE-2013-07-05 (Energy Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Babcock, Bruce A. & Marette, Stéphan & Tréguer, David, 2011.
"Opportunity for profitable investments in cellulosic biofuels,"
Elsevier, vol. 39(2), pages 714-719, February.
- Babcock, Bruce A. & Marette, Stephan & Treguer, David, 2012. "Opportunity for Profitable Investments in Cellulosic Biofuels," Staff General Research Papers 34900, Iowa State University, Department of Economics.
- Deaton, Angus & Laroque, Guy, 1992.
"On the Behaviour of Commodity Prices,"
Review of Economic Studies,
Wiley Blackwell, vol. 59(1), pages 1-23, January.
- Deaton, A. & Laroque, G., 1989. "On The Behavior Of Commodity Prices," Papers 145, Princeton, Woodrow Wilson School - Development Studies.
- Angus Deaton & Guy Laroque, 1990. "On The Behavior of Commodity Prices," NBER Working Papers 3439, National Bureau of Economic Research, Inc.
- Deaton, A. & Laroque, G., 1989. "On The Behavior Of Commodity Prices," Papers 145, Princeton, Woodrow Wilson School - Public and International Affairs.
- In, Francis & Inder, Brett, 1997. "Long‐run Relationships Between World Vegetable Oil Prices," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 41(4), December.
- Philip J. Dawson & Ana I. Sanju�n & Ben White, 2006. "Structural Breaks and the Relationship between Barley and Wheat Futures Prices on the London International Financial Futures Exchange," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 28(4), pages 585-594.
- Stephan Pfaffenzeller & Paul Newbold & Anthony Rayner, 2007. "A Short Note on Updating the Grilli and Yang Commodity Price Index," World Bank Economic Review, World Bank Group, vol. 21(1), pages 151-163.
- Kocoloski, Matt & Michael Griffin, W. & Scott Matthews, H., 2011. "Impacts of facility size and location decisions on ethanol production cost," Energy Policy, Elsevier, vol. 39(1), pages 47-56, January.
- Ballarin, A. & Vecchiato, D. & Tempesta, T. & Marangon, F. & Troiano, S., 2011. "Biomass energy production in agriculture: A weighted goal programming analysis," Energy Policy, Elsevier, vol. 39(3), pages 1123-1131, March.
- Stacie Beck, 2001. "Autoregressive conditional heteroscedasticity in commodity spot prices," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 16(2), pages 115-132.
- Rozakis, S. & Sourie, J. -C., 2005. "Micro-economic modelling of biofuel system in France to determine tax exemption policy under uncertainty," Energy Policy, Elsevier, vol. 33(2), pages 171-182, January.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (RÃ©gis Grateau).
If references are entirely missing, you can add them using this form.