IDEAS home Printed from https://ideas.repec.org/a/eee/enepol/v101y2017icp77-89.html
   My bibliography  Save this article

Economies of scale in biogas production and the significance of flexible regulation

Author

Listed:
  • Skovsgaard, Lise
  • Jacobsen, Henrik Klinge

Abstract

Biogas production is characterised by economies of scale in capital and operational costs of the plant and diseconomies of scale from transport of input materials. We analyse biogas in a Danish setting where most biogas is based on manure, we use a case study with actual distances, and find that the benefits of scale in capital and operational costs dominate the diseconomies of increasing transport distances to collect manure. To boost the yield it is common to use co-substrates in the biogas production. We investigate how costs and income changes, when sugar beet is added in this case study, and demonstrate that transport cost can be critical in relation to co-substrates. Further we compare the new Danish support for upgraded biogas with the traditional support for biogas being used in Combined Heat and Power production in relation to scale economies. We argue that economies of scale is facilitated by the new regulation providing similar support to upgraded biogas fed into the natural gas grid, however in order to keep transport costs low, we suggest that the biogas plants should be allowed to use and combine as many co-substrates as possible, respecting the sustainability criteria regarding energy crops in Danish legislation.

Suggested Citation

  • Skovsgaard, Lise & Jacobsen, Henrik Klinge, 2017. "Economies of scale in biogas production and the significance of flexible regulation," Energy Policy, Elsevier, vol. 101(C), pages 77-89.
    • Handle: RePEc:eee:enepol:v:101:y:2017:i:c:p:77-89
    DOI: 10.1016/j.enpol.2016.11.021
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0301421516306176
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.enpol.2016.11.021?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. Mafakheri, Fereshteh & Nasiri, Fuzhan, 2014. "Modeling of biomass-to-energy supply chain operations: Applications, challenges and research directions," Energy Policy, Elsevier, vol. 67(C), pages 116-126.
    2. Patterson, Tim & Esteves, Sandra & Dinsdale, Richard & Guwy, Alan, 2011. "An evaluation of the policy and techno-economic factors affecting the potential for biogas upgrading for transport fuel use in the UK," Energy Policy, Elsevier, vol. 39(3), pages 1806-1816, March.
    3. Raven, R.P.J.M. & Gregersen, K.H., 2007. "Biogas plants in Denmark: successes and setbacks," Renewable and Sustainable Energy Reviews, Elsevier, vol. 11(1), pages 116-132, January.
    4. Jacobsen, Brian H. & Laugesen, Frederik M. & Dubgaard, Alex, 2014. "The economics of biogas in Denmark: a farm and socioeconomic perspective," International Journal of Agricultural Management, Institute of Agricultural Management, vol. 3(3), pages 1-10.
    5. Lantz, Mikael & Svensson, Mattias & Bjornsson, Lovisa & Borjesson, Pal, 2007. "The prospects for an expansion of biogas systems in Sweden--Incentives, barriers and potentials," Energy Policy, Elsevier, vol. 35(3), pages 1830-1843, March.
    6. Boldrin, Alessio & Baral, Khagendra Raj & Fitamo, Temesgen & Vazifehkhoran, Ali Heidarzadeh & Jensen, Ida Græsted & Kjærgaard, Ida & Lyng, Kari-Anne & van Nguyen, Quan & Nielsen, Lise Skovsgaard & Tri, 2016. "Optimised biogas production from the co-digestion of sugar beet with pig slurry: Integrating energy, GHG and economic accounting," Energy, Elsevier, vol. 112(C), pages 606-617.
    7. Brudermann, Thomas & Mitterhuber, Corinna & Posch, Alfred, 2015. "Agricultural biogas plants – A systematic analysis of strengths, weaknesses, opportunities and threats," Energy Policy, Elsevier, vol. 76(C), pages 107-111.
    Full references (including those not matched with items on IDEAS)

    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. Daniela Szymańska & Aleksandra Lewandowska, 2015. "Biogas Power Plants in Poland—Structure, Capacity, and Spatial Distribution," Sustainability, MDPI, vol. 7(12), pages 1-19, December.
    2. Kari-Anne Lyng & Lise Skovsgaard & Henrik Klinge Jacobsen & Ole Jørgen Hanssen, 2020. "The implications of economic instruments on biogas value chains: a case study comparison between Norway and Denmark," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 22(8), pages 7125-7152, December.
    3. Skovsgaard, Lise & Jensen, Ida Græsted, 2018. "Recent trends in biogas value chains explained using cooperative game theory," Energy Economics, Elsevier, vol. 74(C), pages 503-522.
    4. Ammenberg, Jonas & Feiz, Roozbeh, 2017. "Assessment of feedstocks for biogas production, part II—Results for strategic decision making," Resources, Conservation & Recycling, Elsevier, vol. 122(C), pages 388-404.
    5. Uusitalo, V. & Havukainen, J. & Soukka, R. & Väisänen, S. & Havukainen, M. & Luoranen, M., 2015. "Systematic approach for recognizing limiting factors for growth of biomethane use in transportation sector – A case study in Finland," Renewable Energy, Elsevier, vol. 80(C), pages 479-488.
    6. Cong, Rong-Gang & Caro, Dario & Thomsen, Marianne, 2017. "Is it beneficial to use biogas in the Danish transport sector?–An environmental-economic analysis," MPRA Paper 112291, University Library of Munich, Germany.
    7. Scholz, Marco & Melin, Thomas & Wessling, Matthias, 2013. "Transforming biogas into biomethane using membrane technology," Renewable and Sustainable Energy Reviews, Elsevier, vol. 17(C), pages 199-212.
    8. Roozbeh Feiz & Jonas Ammenberg & Annika Björn & Yufang Guo & Magnus Karlsson & Yonghui Liu & Yuxian Liu & Laura Shizue Moriga Masuda & Alex Enrich-Prast & Harald Rohracher & Kristina Trygg & Sepehr Sh, 2019. "Biogas Potential for Improved Sustainability in Guangzhou, China—A Study Focusing on Food Waste on Xiaoguwei Island," Sustainability, MDPI, vol. 11(6), pages 1-25, March.
    9. Suberu, Mohammed Yekini & Bashir, Nouruddeen & Mustafa, Mohd. Wazir, 2013. "Biogenic waste methane emissions and methane optimization for bioelectricity in Nigeria," Renewable and Sustainable Energy Reviews, Elsevier, vol. 25(C), pages 643-654.
    10. Marta Szyba & Jerzy Mikulik, 2023. "Management of Biodegradable Waste Intended for Biogas Production in a Large City," Energies, MDPI, vol. 16(10), pages 1-19, May.
    11. Stelios Rozakis & Andrea Bartoli & Jacek Dach & Anna Jędrejek & Alina Kowalczyk-Juśko & Łukasz Mamica & Patrycja Pochwatka & Rafał Pudelko & Kesheng Shu, 2021. "Policy Impact on Regional Biogas Using a Modular Modeling Tool," Energies, MDPI, vol. 14(13), pages 1-21, June.
    12. Patrizio, P. & Leduc, S. & Chinese, D. & Dotzauer, E. & Kraxner, F., 2015. "Biomethane as transport fuel – A comparison with other biogas utilization pathways in northern Italy," Applied Energy, Elsevier, vol. 157(C), pages 25-34.
    13. Masayasu Asai & Takashi Hayashi & Mitasu Yamamoto, 2019. "Mental Model Analysis of Biogas Energy Perceptions and Policy Reveals Potential Constraints in a Japanese Farm Community," Sustainability, MDPI, vol. 11(1), pages 1-20, January.
    14. Ba, Birome Holo & Prins, Christian & Prodhon, Caroline, 2016. "Models for optimization and performance evaluation of biomass supply chains: An Operations Research perspective," Renewable Energy, Elsevier, vol. 87(P2), pages 977-989.
    15. Liu, Liwei & Ye, Junhong & Zhao, Yufei & Zhao, Erdong, 2015. "The plight of the biomass power generation industry in China – A supply chain risk perspective," Renewable and Sustainable Energy Reviews, Elsevier, vol. 49(C), pages 680-692.
    16. Premier, G.C. & Kim, J.R. & Massanet-Nicolau, J. & Kyazze, G. & Esteves, S.R.R. & Penumathsa, B.K.V. & Rodríguez, J. & Maddy, J. & Dinsdale, R.M. & Guwy, A.J., 2013. "Integration of biohydrogen, biomethane and bioelectrochemical systems," Renewable Energy, Elsevier, vol. 49(C), pages 188-192.
    17. Triolo, Jin M. & Ward, Alastair J. & Pedersen, Lene & Løkke, Mette M. & Qu, Haiyan & Sommer, Sven G., 2014. "Near Infrared Reflectance Spectroscopy (NIRS) for rapid determination of biochemical methane potential of plant biomass," Applied Energy, Elsevier, vol. 116(C), pages 52-57.
    18. Sofia Dahlgren & Jonas Ammenberg, 2021. "Sustainability Assessment of Public Transport, Part II—Applying a Multi-Criteria Assessment Method to Compare Different Bus Technologies," Sustainability, MDPI, vol. 13(3), pages 1-30, January.
    19. Kargbo, Hannah & Harris, Jonathan Stuart & Phan, Anh N., 2021. "“Drop-in” fuel production from biomass: Critical review on techno-economic feasibility and sustainability," Renewable and Sustainable Energy Reviews, Elsevier, vol. 135(C).
    20. Edwards, Joel & Othman, Maazuza & Burn, Stewart, 2015. "A review of policy drivers and barriers for the use of anaerobic digestion in Europe, the United States and Australia," Renewable and Sustainable Energy Reviews, Elsevier, vol. 52(C), pages 815-828.

    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:enepol:v:101:y:2017:i:c:p:77-89. 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/enpol .

    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.