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Impact of feedstock diversification on the cost-effectiveness of biodiesel

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  • Gülşen, Ece
  • Olivetti, Elsa
  • Freire, Fausto
  • Dias, Luis
  • Kirchain, Randolph

Abstract

While biodiesel production and consumption for use in transportation has risen considerably over the last decade, its competitiveness in the marketplace is largely due to regulatory and fiscal support from governmental bodies, exceeding $25 billion in 2010 in the EU and US alone. The price of feedstocks represent 80–85% of the total biodiesel cost, and with over 350 different oil feedstocks available for blending, there is potential to optimize feedstock blends to reduce costs. This paper presents a chance-constrained optimization model that considers the technical constraints of conventional, first generation feedstocks, pricing trends, as well as the uncertainty and variation latent within these numbers. Further, the frequency with which a feedstock blend portfolio should be re-evaluated is considered through a case study. The model is then applied to a second case study for actual fuel constraint scenarios used in the EU and US. The results demonstrate the potential for substantial cost savings through targeted feedstock diversification, minimizing risks to producers from price fluctuations while still meeting technical fuel standards.

Suggested Citation

  • Gülşen, Ece & Olivetti, Elsa & Freire, Fausto & Dias, Luis & Kirchain, Randolph, 2014. "Impact of feedstock diversification on the cost-effectiveness of biodiesel," Applied Energy, Elsevier, vol. 126(C), pages 281-296.
    • Handle: RePEc:eee:appene:v:126:y:2014:i:c:p:281-296
    DOI: 10.1016/j.apenergy.2014.03.063
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    Cited by:

    1. Caldeira, Carla & Swei, Omar & Freire, Fausto & Dias, Luis C. & Olivetti, Elsa A. & Kirchain, Randolph, 2019. "Planning strategies to address operational and price uncertainty in biodiesel production," Applied Energy, Elsevier, vol. 238(C), pages 1573-1581.
    2. Pires de Oliveira, Ivan & Caires, Anderson Rodrigues Lima, 2019. "Molecular arrangement in diesel/biodiesel blends: A Molecular Dynamics simulation analysis," Renewable Energy, Elsevier, vol. 140(C), pages 203-211.
    3. Inam Ullah Khan & Zhenhua Yan & Jun Chen, 2019. "Optimization, Transesterification and Analytical Study of Rhus typhina Non-Edible Seed Oil as Biodiesel Production," Energies, MDPI, vol. 12(22), pages 1-21, November.
    4. Bukkarapu, Kiran Raj & Krishnasamy, Anand, 2022. "A critical review on available models to predict engine fuel properties of biodiesel," Renewable and Sustainable Energy Reviews, Elsevier, vol. 155(C).
    5. Cao, Leichang & Zhang, Shicheng, 2015. "Production and characterization of biodiesel derived from Hodgsonia macrocarpa seed oil," Applied Energy, Elsevier, vol. 146(C), pages 135-140.

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