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Switching to Perennial Energy Crops under Uncertainty and Costly Reversibility AgEcon
Song, Feng; Zhao, Jinhua; Swinton, Scott M..
We study a farmer’s decision to convert traditional crop land into growing dedicated energy crops, taking in account sunk conversion costs, uncertainties in traditional and energy crop returns, and learning. The optimal decision rules differ significantly from the expected net present value rule, which ignores learning, and from real option models that allow only one way conversions into energy crops. These models also predict drastically different patterns of land conversions into and out of energy crops over time. Using corn-soybean rotations and switchgrass as examples, we show that the model predictions are sensitive to assumptions about stochastic processes of the returns. Government policies might have unintended consequences: subsidizing conversion...
Tipo: Working or Discussion Paper Palavras-chave: Real options; Irreversibility; Sunk costs; Land conversion; Biofuel; Cellulosic biomass; Dynamic modeling; Stochastic process; Biofuel policy; Land Economics/Use; Resource /Energy Economics and Policy; Risk and Uncertainty; Q42; Q24.
Ano: 2009 URL: http://purl.umn.edu/56195
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Conditions Necessary for Private Investment in the Ethanol Industry AgEcon
Kenkel, Philip L.; Holcomb, Rodney B..
While agricultural economics literature has become rife with the economics of ethanol production and cellulosic ethanol feedstock production, little has been written about capital investment necessary for the magnitude of industry development mandated by the Energy Security and Independence Act of 2007. Financing the development of the ethanol industry to meet the 36 billion gallon production capacity set for 2022 (with 16 billion gallons from cellulosic ethanol) will require capital investments exceeding $100 billion for production facilities, plus extensive investment in feedstock establishment and transportation/handling infrastructure. Federal support associated with political mandates does not address all of the financial issues related with the...
Tipo: Journal Article Palavras-chave: Biofuel policy; Cellulosic ethanol; Industry legitimacy; Private investment; Agribusiness; Agricultural Finance; Crop Production/Industries; Resource /Energy Economics and Policy; Q13; Q42; Q43; Q48.
Ano: 2009 URL: http://purl.umn.edu/53092
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Biomass Supply from Alternative Cellulosic Crops and Crop Residues: A Preliminary Spatial Bioeconomic Modeling Approach AgEcon
Egbendewe-Mondzozo, Aklesso; Swinton, Scott M.; Izaurralde, R. Cesar; Manowitz, David H.; Zhang, Xuesong.
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...
Tipo: Working or Discussion Paper Palavras-chave: 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.
Ano: 2010 URL: http://purl.umn.edu/98277
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IMPACT OF US AND EUROPEAN BIOFUEL POLICIES ON FOREST CARBON AgEcon
Kim, Yoon Hyung; Sohngen, Brent; Golub, Alla A.; Hertel, Thomas W.; Rose, Steven K..
This paper develops a dynamic, regional analysis of the effects of US and European biofuel mandates on land use, forestry stocks, and carbon emissions. The results suggest that these mandates may cause an additional 23-26 million hectares of forestland losses globally, but additional carbon emissions of 1.2 – 1.6 billion t CO2. The estimates are found to be sensitive to the elasticity parameter on the land supply function in the model, with the higher elasticity estimates associated with larger carbon losses. The regional analysis turns out to be quite important, because some regions end up gaining forestland and increasing carbon stocks. The regional and dynamic effects have been missed by most other noteworthy analyses of the induced land use effects...
Tipo: Conference Paper or Presentation Palavras-chave: Biofuel policy; Indirect land use effects; Forest carbon sequestration; Environmental Economics and Policy; Land Economics/Use; Resource /Energy Economics and Policy.
Ano: 2010 URL: http://purl.umn.edu/61456
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Economic and Environmental Impacts of Washington State Biofuel Policy Alternatives AgEcon
McCullough, Michael; Holland, David W.; Painter, Kathleen M.; Stodick, Leroy; Yoder, Jonathan K..
A computable general equilibrium model is used to analyze the effectiveness of policy alternatives at achieving biofuel-related goals in Washington State. Policy regimes compared include blend mandates, generally funded volumetric and CO2e (CO2 equivalent) emissions-based tax/subsidy regimes, and revenue-neutral funded tax/subsidy regimes that use fossil fuel taxes to fund renewable fuel subsidies. Results suggest that a revenue-neutral CO2e emissions-based tax/subsidy is arguably the most effective single alternative for pursuing the full set of objectives emphasized in recent Washington State legislation.
Tipo: Article Palavras-chave: Biodiesel; Biofuel policy; Computable general equilibrium; CO2 equivalent emissions; Environmental Economics and Policy; Land Economics/Use; Resource /Energy Economics and Policy.
Ano: 2011 URL: http://purl.umn.edu/119183
Registros recuperados: 5
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