IDEAS home Printed from https://ideas.repec.org/a/eee/eneeco/v44y2014icp281-290.html
   My bibliography  Save this article

Economic evaluation of the conversion of industrial paper sludge to ethanol

Author

Listed:
  • Chen, Hui
  • Venditti, Richard
  • Gonzalez, Ronalds
  • Phillips, Richard
  • Jameel, Hasan
  • Park, Sunkyu

Abstract

The conversion of industrial paper sludge to ethanol was simulated using engineering process simulation software loaded with laboratory generated conversion data and financially analyzed. In one scenario, sludge is fractionated to remove ash, generating a higher concentration carbohydrate stream for separate hydrolysis and fermentation (SHF). In a second scenario, non-fractionated sludge is processed with only pH adjustment. Four primary sludges from mills producing either virgin or recycled paper were analyzed and the experimental conversion results used to inform the simulations. Financial analysis was conducted assuming ethanol wholesale price of US$ 0.608 per liter. The most profitable case was fractionated virgin sludge (from a virgin paper mill) to ethanol (F-VK1) with a net present value (NPV) of US$ 11.4million, internal rate of return (IRR) of 28%, payback period of 4.4years and minimum ethanol revenue (MER) of US$ 0.32 per liter. Risk analysis showed that the F-VK1 case obtained a near 100% probability of business success with both central and bearish (pessimistic) assumptions.

Suggested Citation

  • Chen, Hui & Venditti, Richard & Gonzalez, Ronalds & Phillips, Richard & Jameel, Hasan & Park, Sunkyu, 2014. "Economic evaluation of the conversion of industrial paper sludge to ethanol," Energy Economics, Elsevier, vol. 44(C), pages 281-290.
    • Handle: RePEc:eee:eneeco:v:44:y:2014:i:c:p:281-290
    DOI: 10.1016/j.eneco.2014.04.018
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0140988314001029
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.eneco.2014.04.018?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Kierulff, Herbert, 2008. "MIRR: A better measure," Business Horizons, Elsevier, vol. 51(4), pages 321-329.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Bousios, Spyridon & Worrell, Ernst, 2017. "Towards a Multiple Input-Multiple Output paper mill: Opportunities for alternative raw materials and sidestream valorisation in the paper and board industry," Resources, Conservation & Recycling, Elsevier, vol. 125(C), pages 218-232.
    2. Robus, Charles L.L. & Gottumukkala, Lalitha Devi & van Rensburg, Eugéne & Görgens, Johann F., 2016. "Feasible process development and techno-economic evaluation of paper sludge to bioethanol conversion: South African paper mills scenario," Renewable Energy, Elsevier, vol. 92(C), pages 333-345.
    3. Shona M. Duncan & Malek Alkasrawi & Raghu Gurram & Fares Almomani & Amy E Wiberley-Bradford & Eric Singsaas, 2020. "Paper Mill Sludge as a Source of Sugars for Use in the Production of Bioethanol and Isoprene," Energies, MDPI, vol. 13(18), pages 1-12, September.
    4. Zabed, H. & Sahu, J.N. & Suely, A. & Boyce, A.N. & Faruq, G., 2017. "Bioethanol production from renewable sources: Current perspectives and technological progress," Renewable and Sustainable Energy Reviews, Elsevier, vol. 71(C), pages 475-501.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Lachaud, Michée A. & Bravo-Ureta, Boris E., 2022. "A Bayesian statistical analysis of return to agricultural R&D investment in Latin America: Implications for food security," Technology in Society, Elsevier, vol. 70(C).
    2. Magni, Carlo Alberto, 2016. "Capital depreciation and the underdetermination of rate of return: A unifying perspective," Journal of Mathematical Economics, Elsevier, vol. 67(C), pages 54-79.
    3. Gabriel Browne de Deus Ribeiro & Maria das Dores Saraiva De Loreto & Edna Lopes Miranda & Rosária Cal Bastos & Catariny Cabral Aleman & Fernando França da Cunha & Paola Delatorre Rodrigues, 2024. "The Use of Financial Tools in Small-Scale Irrigated Crops to Assess Socioeconomic Sustainability: A Case Study in Tocantins-Araguaia Basin, Brazil," Sustainability, MDPI, vol. 16(5), pages 1-15, February.
    4. Cuthbert, James R. & Magni, Carlo Alberto, 2016. "Measuring the inadequacy of IRR in PFI schemes using profitability index and AIRR," International Journal of Production Economics, Elsevier, vol. 179(C), pages 130-140.
    5. Kerchner, Charles D. & Keeton, William S., 2015. "California's regulatory forest carbon market: Viability for northeast landowners," Forest Policy and Economics, Elsevier, vol. 50(C), pages 70-81.
    6. Carlo Alberto Magni, 2010. "Average Internal Rate of Return and investment decisions: A new perspective," Centro Studi di Banca e Finanza (CEFIN) (Center for Studies in Banking and Finance) 0021, Universita di Modena e Reggio Emilia, Dipartimento di Economia "Marco Biagi".
    7. Xudong Rao & Terrance M. Hurley & Philip G. Pardey, 2020. "Recalibrating the reported returns to agricultural R&D: what if we all heeded Griliches?," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 64(3), pages 977-1001, July.
    8. Fioriti, Davide & Pintus, Salvatore & Lutzemberger, Giovanni & Poli, Davide, 2020. "Economic multi-objective approach to design off-grid microgrids: A support for business decision making," Renewable Energy, Elsevier, vol. 159(C), pages 693-704.
    9. Carlo Alberto Magni, 2009. "Accounting and economic measures:An integrated theory of capital budgeting," Centro Studi di Banca e Finanza (CEFIN) (Center for Studies in Banking and Finance) 0019, Universita di Modena e Reggio Emilia, Dipartimento di Economia "Marco Biagi".
    10. Simone N. Tuor & Uschi Backes‐Gellner, 2010. "Risk‐return trade‐offs to different educational paths: vocational, academic and mixed," International Journal of Manpower, Emerald Group Publishing Limited, vol. 31(5), pages 495-519, August.
    11. Mária Illés, 2012. "Transforming the Net Present Value for a Comparable One," Theory Methodology Practice (TMP), Faculty of Economics, University of Miskolc, vol. 8(01), pages 24-32.
    12. James F. Oehmke, 2017. "Re‐Examining the Reported Rates of Return to Food and Agricultural Research and Development: Comment," American Journal of Agricultural Economics, John Wiley & Sons, vol. 99(3), pages 818-826, April.
    13. Arnold, Uwe & Yildiz, Özgür, 2015. "Economic risk analysis of decentralized renewable energy infrastructures – A Monte Carlo Simulation approach," Renewable Energy, Elsevier, vol. 77(C), pages 227-239.
    14. Sina Atari & Yassine Bakkar & Eunice Omolola Olaniyi & Gunnar Prause, 2019. "Real options analysis of abatement investments for sulphur emission control compliance," Entrepreneurship and Sustainability Issues, VsI Entrepreneurship and Sustainability Center, vol. 6(3), pages 1062-1087, March.
    15. Carlos Omar Trejo-Pech & James A. Larson & Burton C. English & T. Edward Yu, 2019. "Cost and Profitability Analysis of a Prospective Pennycress to Sustainable Aviation Fuel Supply Chain in Southern USA," Energies, MDPI, vol. 12(16), pages 1-18, August.
    16. Andrey Leonidov & Ilya Tipunin & Ekaterina Serebryannikova, 2020. "On Evaluation of Risky Investment Projects. Investment Certainty Equivalence," Papers 2005.12173, arXiv.org.
    17. Dalton, Gordon & Allan, Grant & Beaumont, Nicola & Georgakaki, Aliki & Hacking, Nick & Hooper, Tara & Kerr, Sandy & O’Hagan, Anne Marie & Reilly, Kieran & Ricci, Pierpaolo & Sheng, Wanan & Stallard, T, 2015. "Economic and socio-economic assessment methods for ocean renewable energy: Public and private perspectives," Renewable and Sustainable Energy Reviews, Elsevier, vol. 45(C), pages 850-878.
    18. P, Prakash & Kumar, Pramod & Kishore, Prabhat & Jaganathan, D. & Immanuel, Sheela, 2021. "Economic Feasibility of Polyhouse Establishment with and without Government Subsidy Support: A Case of Gerbera Cultivation in Maharashtra, India," 2021 Conference, August 17-31, 2021, Virtual 314961, International Association of Agricultural Economists.
    19. Aringo, Marielle Q. & Ella, Victor B. & Martinez, Camille G. & Pereira, Gamiello S., 2022. "Ex-ante Cost-Benefit Analysis of High-end and Low-cost Wireless Sensor Network (WSN) Technology Packages for Efficient Irrigation Water Management in the Philippines," Journal of Economics, Management & Agricultural Development, Journal of Economics, Management & Agricultural Development (JEMAD), vol. 8(2), December.
    20. Ben-Horin, Moshe & Kroll, Yoram, 2017. "A simple intuitive NPV-IRR consistent ranking," The Quarterly Review of Economics and Finance, Elsevier, vol. 66(C), pages 108-114.

    More about this item

    Keywords

    Paper sludge; Mechanical fractionation; Enzymatic hydrolysis; Fermentation; Process simulation; Economic analysis;
    All these keywords.

    JEL classification:

    • Q16 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - R&D; Agricultural Technology; Biofuels; Agricultural Extension Services
    • Q10 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - General
    • Q20 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - General
    • Q27 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Issues in International Trade
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:eneeco:v:44:y:2014:i:c:p:281-290. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/eneco .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.