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Economic analysis of an aviation bioenergy supply chain

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  • Reimer, Jeffrey J.
  • Zheng, Xiaojuan

Abstract

This study develops a regional economic model that can mimic stages of a potential aviation fuel supply chain based on the oilseed camelina. A general equilibrium model is developed that accounts for key sectors of the supply chain, and is parameterized using detailed data for the Pacific Northwest region of the United States. Model scenarios are developed to evaluate the potential effectiveness of policies that would promote the development of the supply chain. While the existing low price of conventional fuel makes camelina-based fuel economically infeasible at present, the supply chain could be viable if consumers, e.g. airline passengers, are willing pay more to use the biofuel, such as if they perceive an environmental benefit from it. Alternatively, if use of the oilseed is consistent with the energy policy priorities of policymakers, one of the following approaches could potentially work: a 17% subsidy on the alternative fuel, a 20% tax on the conventional fuel, or a combination 9% subsidy on the alternative and 9% tax on the conventional fuel. Implications for economic efficiency, regional employment, and economic welfare are quantified.

Suggested Citation

  • Reimer, Jeffrey J. & Zheng, Xiaojuan, 2017. "Economic analysis of an aviation bioenergy supply chain," Renewable and Sustainable Energy Reviews, Elsevier, vol. 77(C), pages 945-954.
  • Handle: RePEc:eee:rensus:v:77:y:2017:i:c:p:945-954
    DOI: 10.1016/j.rser.2016.12.036
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    References listed on IDEAS

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    1. Reimer, Jeffrey J. & Zheng, Xiaojuan & Gehlhar, Mark J., 2012. "Export Demand Elasticity Estimation for Major U.S. Crops," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 44(4), pages 1-15, November.
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    6. McCullough, Michael & Holland, David W. & Painter, Kathleen M. & Stodick, Leroy & Yoder, Jonathan K., 2011. "Economic and Environmental Impacts of Washington State Biofuel Policy Alternatives," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 36(3), pages 1-15.
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    Cited by:

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    2. Mousavi-Avval, Seyed Hashem & Shah, Ajay, 2021. "Techno-economic analysis of hydroprocessed renewable jet fuel production from pennycress oilseed," Renewable and Sustainable Energy Reviews, Elsevier, vol. 149(C).
    3. Cho, Seojin & Antle, John M., 2019. "Impact of Domestic and Trade Policies on Adoption of a Biofuel Crop in Dryland Wheat-Based Farming Systems in U.S. Pacific Northwest," 2019 Annual Meeting, July 21-23, Atlanta, Georgia 290920, Agricultural and Applied Economics Association.
    4. Brinkman, Marnix L.J. & Wicke, Birka & Faaij, André P.C. & van der Hilst, Floor, 2019. "Projecting socio-economic impacts of bioenergy: Current status and limitations of ex-ante quantification methods," Renewable and Sustainable Energy Reviews, Elsevier, vol. 115(C).
    5. Huang, Endai & Zhang, Xiaolei & Rodriguez, Luis & Khanna, Madhu & de Jong, Sierk & Ting, K.C. & Ying, Yibin & Lin, Tao, 2019. "Multi-objective optimization for sustainable renewable jet fuel production: A case study of corn stover based supply chain system in Midwestern U.S," Renewable and Sustainable Energy Reviews, Elsevier, vol. 115(C).
    6. Qiu, Rui & Hou, Shuhua & Meng, Zhiyi, 2021. "Low carbon air transport development trends and policy implications based on a scientometrics-based data analysis system," Transport Policy, Elsevier, vol. 107(C), pages 1-10.
    7. Wang, Wei-Cheng, 2019. "Techno-economic analysis for evaluating the potential feedstocks for producing hydro-processed renewable jet fuel in Taiwan," Energy, Elsevier, vol. 179(C), pages 771-783.
    8. de Souza, Lorena Mendes & Mendes, Pietro A.S. & Aranda, Donato A.G., 2020. "Oleaginous feedstocks for hydro-processed esters and fatty acids (HEFA) biojet production in southeastern Brazil: A multi-criteria decision analysis," Renewable Energy, Elsevier, vol. 149(C), pages 1339-1351.
    9. Klein, Bruno Colling & Chagas, Mateus Ferreira & Junqueira, Tassia Lopes & Rezende, Mylene Cristina Alves Ferreira & Cardoso, Terezinha de Fátima & Cavalett, Otavio & Bonomi, Antonio, 2018. "Techno-economic and environmental assessment of renewable jet fuel production in integrated Brazilian sugarcane biorefineries," Applied Energy, Elsevier, vol. 209(C), pages 290-305.

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