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Profitability Analysis for Biomethane: A Strategic Role in the Italian Transport Sector

Author

Listed:
  • Federica Cucchiella

    (Department of Industrial Engineering and Information and Economy, Via G. Gronchi 18, 67100 L Aquila, University of L Aquila, Italy.)

  • Idiano D Adamo

    (Department of Industrial Engineering and Information and Economy, Via G. Gronchi 18, 67100 L Aquila, University of L Aquila, Italy.)

  • Massimo Gastaldi

    (Department of Industrial Engineering and Information and Economy, Via G. Gronchi 18, 67100 L Aquila, University of L Aquila, Italy.)

Abstract

Biomethane is an interesting source for sustainable energy systems, featuring great flexibility that translates into multiple possible applications (vehicle fuel, combined production of thermal and electrical energy, injection in the gas grid). Compared to biogas, biomethane permits greater efficiency. Its use is not limited to the immediate area of the plant and purification of the raw methane means greater lifespans for the equipment. This paper analyses its use in the transport sector in light of recent statutory changes that introduce incentives. Net present value and discounted payback time are applied for the evaluation of profitability of biomethane plants, and are calculated in function of the feedstocks used, the plant dimensions and the firm configuration (producer and distributor combined; separate firms). Environmental considerations and a high number of natural gas vehicles define its strategic role in the Italian transport sector.

Suggested Citation

  • Federica Cucchiella & Idiano D Adamo & Massimo Gastaldi, 2015. "Profitability Analysis for Biomethane: A Strategic Role in the Italian Transport Sector," International Journal of Energy Economics and Policy, Econjournals, vol. 5(2), pages 440-449.
    • Handle: RePEc:eco:journ2:2015-02-07
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    More about this item

    Keywords

    Biomethane; Economic Development; Sustainability;
    All these keywords.

    JEL classification:

    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • Q2 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation

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