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The influence of a Renewable Energy Feed in Tariff on the decision to produce biomass crops in Ireland

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  • Clancy, D.
  • Breen, J.P.
  • Thorne, F.
  • Wallace, M.

Abstract

A target of 30 per cent substitution of biomass for peat in the three peat fired power stations from 2015 has been set by the Irish Government. However, a knowledge gap exists on the extent to which Irish farmers would actually choose to grow these crops. An extension of the Renewable Energy Feed in Tariff (REFIT) scheme to include the co-firing of biomass with peat in electricity generation would enable the power stations to enter into Power Purchase Agreements (PPAs). These offer a fixed price to farmers for biomass feedstock. The decision to adopt biomass is represented as a constrained problem under certainty with the objective of profit maximisation. The results showed that the price offered under a PPA has a large effect on the economic returns from biomass crops. The price that the power stations previously estimated they would be able to pay, at €46 and €48 per tonne for willow and miscanthus, respectively, was used as a starting point. At this price the number of farmers who would choose to adopt biomass production is insufficient to achieve the national co-firing target. The target could be achieved at €70 and €65 per tonne for willow and miscanthus, respectively.

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  • Clancy, D. & Breen, J.P. & Thorne, F. & Wallace, M., 2012. "The influence of a Renewable Energy Feed in Tariff on the decision to produce biomass crops in Ireland," Energy Policy, Elsevier, vol. 41(C), pages 412-421.
    • Handle: RePEc:eee:enepol:v:41:y:2012:i:c:p:412-421
    DOI: 10.1016/j.enpol.2011.11.001
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    1. de Oliveira, Jofran Luiz & da Silva, Jadir Nogueira & Graciosa Pereira, Emanuele & Oliveira Filho, Delly & Rizzo Carvalho, Daniel, 2013. "Characterization and mapping of waste from coffee and eucalyptus production in Brazil for thermochemical conversion of energy via gasification," Renewable and Sustainable Energy Reviews, Elsevier, vol. 21(C), pages 52-58.
    2. Witzel, Carl-Philipp & Finger, Robert, 2016. "Economic evaluation of Miscanthus production – A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 53(C), pages 681-696.
    3. Barbosa, Luciana & Ferrão, Paulo & Rodrigues, Artur & Sardinha, Alberto, 2018. "Feed-in tariffs with minimum price guarantees and regulatory uncertainty," Energy Economics, Elsevier, vol. 72(C), pages 517-541.
    4. P. Mathiou & Stelios Rozakis & Rafal Pudelko & A. Faber, 2012. "Economic and spatial modelling for estimating supply of perennial crops’ biomass in Poland," Working Papers 2012-2, Agricultural University of Athens, Department Of Agricultural Economics.
    5. P. Mathiou & Stelios Rozakis & Rafal Pudelko & A. Faber & A. Petsakos, 2014. "Utility maximising supply response: the case of perennial biomass plantations in Poland," Working Papers 2014-3, Agricultural University of Athens, Department Of Agricultural Economics.
    6. Ramli, Makbul A.M. & Twaha, Ssennoga, 2015. "Analysis of renewable energy feed-in tariffs in selected regions of the globe: Lessons for Saudi Arabia," Renewable and Sustainable Energy Reviews, Elsevier, vol. 45(C), pages 649-661.
    7. Sutherland, Lee-Ann & Peter, Sarah & Zagata, Lukas, 2015. "Conceptualising multi-regime interactions: The role of the agriculture sector in renewable energy transitions," Research Policy, Elsevier, vol. 44(8), pages 1543-1554.
    8. Devlin, Ger & Talbot, Bruce, 2014. "Deriving cooperative biomass resource transport supply strategies in meeting co-firing energy regulations: A case for peat and wood fibre in Ireland," Applied Energy, Elsevier, vol. 113(C), pages 1700-1709.

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    Keywords

    Biomass; Co-firing; REFIT;
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