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Stochastic Techno-Economic Analysis of Alcohol-to-Jet Fuel Production

Author

Listed:
  • Yao, Guolin
  • Staples, Mark
  • Malina, Robert
  • Tyner, Wallace

Abstract

This study assesses the alcohol-to-jet (ATJ) biofuel production pathway for three biomass feedstocks, and advances existing techno-economic analyses (TEA) of biofuels in three ways. First, we incorporate technical uncertainty for all by-products and co-products though statistical linkages between conversion efficiencies and input and output levels. Second, future price uncertainty is based on case-by-case time-series estimation. Third, breakeven price distributions are developed to present profitability at each price level. The stochastic dominance results show that sugarcane is the lowest cost feedstock over the entire range of uncertainty, followed by corn grain and switchgrass, with the mean breakeven jet fuel prices being $0.96/liter ($3.65/gal), $1.01/liter ($3.84/gal), and $1.38/liter ($5.21/gal), respectively. With a 75% profitability level, the breakeven prices for corn grain, sugarcane and switchgrass become $1.07/liter ($4.05/gal), $1.05/liter ($3.97/gal), and $1.53/liter ($5.81/gal), respectively. Sensitivity analyses show that technical uncertainty significantly impacts breakeven prices and NPV distributions.

Suggested Citation

  • Yao, Guolin & Staples, Mark & Malina, Robert & Tyner, Wallace, 2016. "Stochastic Techno-Economic Analysis of Alcohol-to-Jet Fuel Production," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235479, Agricultural and Applied Economics Association.
    • Handle: RePEc:ags:aaea16:235479
    DOI: 10.22004/ag.econ.235479
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    Cited by:

    1. Zhao, Xin & Yao, Guolin & Tyner, Wallace E., 2016. "Quantifying breakeven price distributions in stochastic techno-economic analysis," Applied Energy, Elsevier, vol. 183(C), pages 318-326.
    2. Sharma, Bijay P. & Yu, Tun-Hsiang Edward & English, Burton C. & Boyer, Christopher M., 2018. "Analyzing the Economics of Renewable Jet Fuels Using a Game-theoretic Approach," 2018 Annual Meeting, August 5-7, Washington, D.C. 273787, Agricultural and Applied Economics Association.
    3. Sogut, M. Ziya & Seçgin, Ömer & Ozkaynak, Süleyman, 2019. "Investigation of thermodynamics performance of alternative jet fuels based on decreasing threat of paraffinic and sulfur," Energy, Elsevier, vol. 181(C), pages 1114-1120.

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