Economic and Environmental Assessment of Advanced Biofuels : Adoption Under Uncertainty, Farmer Willingness, and Land Use Implications

The production of biofuels offers the prospect of enhancing a country’s energy security by limiting petroleum imports and supporting domestic economic activity by bolstering agricultural and allied sectors. Additionally, advanced biofuels can reduce the reliance on food-grain based first generation ethanol, replace a part of our fossil fuel consumption, and potentially reduce environmental impacts through greenhouse gas emission reductions. However, the cellulosic biofuel industry has not developed as anticipated due to slow advancements in the technology for converting feedstock to fuel, improvements in vehicular efficiency, which has muted fuel demand, and lack of an assured year-round supply of feedstock that has hindered commercial viability of cellulosic biofuel production. Against this backdrop, this dissertation explores the development of switchgrass based bioenergy from economic, environmental, and policy perspectives. We evaluate switchgrass adoption under uncertainty by developing a discrete-time binomial framework to model output prices. This approach allows us to incorporate the time-to-establishment attributes of switchgrass cultivation into the modeling framework. We analyze the economic viability of investments in switchgrass cultivation under various price transitions, evaluate the relationship between risk and profitability, and estimate the value of flexible decision-making. Understanding the perceptions of the farming community about producing crops used in biofuel production, and whether they will adopt switchgrass cultivation, is a crucial part of the bioenergy feedstock supply puzzle. To our knowledge, our study undertook the first survey of farmers in Missouri to delineate their perceptions and preferences around bioenergy production since the new administration assumed office. Therefore, our survey results are timely and provide valuable insights regarding the potential for switchgrassbased bioenergy. We unravel the influence of a host of factors on farmer willingness to cultivate switchgrass. Finally, we study the role of farmer perceptions around the suitability of switchgrass for their operations and assess their initial land allocation decisions. We find that land allocated for switchgrass cultivation is more likely to come from lands under hay or under other uses. Our research contributes to the body of knowledge about energy crop cultivation and has important implications for designing policies that consider financial incentives, risk management, and future land use perspectives

Adapting Extension and Outreach Content to Audiences\u27 Educational Interests

For various, largely unknown reasons, decision makers do not have equal interest in all Extension and outreach topics pertinent to a particular concept. This situation hampers Extension\u27s ability to effectively deliver information and efficiently allocate limited resources. Using survey data, we identified heterogeneous preference for various topics related to the concept of woody bioenergy, our case study subject, and built profiles of forestland owners who expressed interest in topics that received above-average and below-average preference rates. Given our results, we argue for using this approach in objectively ranking audiences\u27 educational interests in various forest and nonforest products and services and subsequently allocating time, space, and other Extension resources to the topics of interest

Potential Economic Impacts of Allocating More Land for Bioenergy Biomass Production in Virginia

The growing attention to renewable energy and rural development has created greater demand for production of biomass feedstock for bioenergy. However, forest growth rates and the amount of land in most existing forests may not be sufficient to sustainably supply the forest biomass required to support existing forest products industries and the expanding bioenergy industry. Additionally, concerns about agricultural land use competition have dampened expansion of biomass production on agricultural land base. One of the ways to meet the growing forest biomass feedstock demand for bioenergy production is by allocating currently marginal non-forested land for growing bioenergy feedstocks. In Virginia, about 80% of forestland is under nonindustrial private forest ownership. The land use allocation decisions of these private owners are critical for the supply of the forest biomass feedstock to support bioenergy production. We apply a computable general equilibrium model to assess the economy-wide impacts of forestland owners’ willingness to plant pine on non-forested land for woody bioenergy in Virginia. We consider three counterfactual scenarios of biomass feedstock supply increase as intermediate demand for bioenergy production based on forestland owners’ willingness to accept biomass bid prices to set aside more non-forested land for biomass production in Virginia under general equilibrium conditions. Overall, the results show an increase in social welfare and household utility but a marginal decline in GDP. However, increased demand of biomass from logging sector depressed the manufacturing sector (the wood manufacturing sub-sector particularly), which also relies on the logging sector for its intermediate inputs. Results from this study provide insights into the bioenergy land use competition debate, and pathways towards sustainable bioenergy feedstock supply

Forestland Owners’ Willingness to Consider Multiple Ways of Supplying Biomass Simultaneously: Implications for Biofuel Incentive Policies

Because socioeconomic based approaches account for relevant limiting and motivating factors, they provide a more realistic measurement of forestland owners’ willingness to supply biomass for bioenergy production- information useful to policy makers in setting production targets and in designing relevant incentive programs. Although forestland owners can supply biomass using different means, including supplying biomass from existing stands and changing land use to establish feedstock plantation, among others, previous studies mostly focus only on a given way of supplying biomass at a time. This produces incomplete information that adversely affects its use. By presenting survey takers in Virginia and Texas three different ways of supplying biomass at the same time, we determine forestland owners’ willingness to consider multiple ways of supplying biomass simultaneously and identify the factors that predict such behavior, assess overlap in forestland owners across the different ways of supplying biomass, and assess if and how respondents’ forest management plans and sustainability concerns correspond with their supply decision. Our results show a higher and more articulated rate of willingness to supply biomass than reported in previous studies. The results also suggest that opportunities exist for synergizing programs that incentivize disparate ways of supplying biomass

Sustainability Protocols and Certification Criteria for Switchgrass-Based Bioenergy

Production of bioenergy from cellulosic sources is likely to increase due to mandates, tax incentives, and subsidies. However, unchecked growth in the bioenergy industry has the potential to adversely influence land use, biodiversity, greenhouse gas (GHG) emissions, and water resources. It may have unintended environmental and socioeconomic consequences. Against this backdrop, it is important to develop standards and protocols that ensure sustainable bioenergy production, promote the benefits of biofuels, and avoid or minimize potential adverse outcomes. This paper highlights agronomic information on switchgrass, a high-potential bioenergy feedstock, and the role of specialized certification programs. The existing sustainability standards and protocols were reviewed in order to identify key gaps that justify a certification program specifically for switchgrass-based bioenergy. The criteria and indicators that should be considered for such a certification program are outlined

Sustainability Protocols and Certification Criteria for Switchgrass-Based Bioenergy

Production of bioenergy from cellulosic sources is likely to increase due to mandates, tax incentives, and subsidies. However, unchecked growth in the bioenergy industry has the potential to adversely influence land use, biodiversity, greenhouse gas (GHG) emissions, and water resources. It may have unintended environmental and socioeconomic consequences. Against this backdrop, it is important to develop standards and protocols that ensure sustainable bioenergy production, promote the benefits of biofuels, and avoid or minimize potential adverse outcomes. This paper highlights agronomic information on switchgrass, a high-potential bioenergy feedstock, and the role of specialized certification programs. The existing sustainability standards and protocols were reviewed in order to identify key gaps that justify a certification program specifically for switchgrass-based bioenergy. The criteria and indicators that should be considered for such a certification program are outlined

Factors Affecting Forestland Owners\u27 Allocation of Non-Forested Land to Pine Plantation for Bioenergy in Virginia

Studies have shown that woody bioenergy can have potential economic, social, and environmental benefits. One of the ways to meet the growing biomass demand for woody bioenergy is by allocating currently non-forested land for growing feedstocks such as pine. Towards this end, we conducted a survey on 900 randomly selected private forestland owners in Virginia and asked what proportion of their non-forested land they would allocate for loblolly pine at given bid prices. We then used recursive partitioning based Tobit regression to analyze data. Our results suggest that the experience of having supplied wood for chip-n-saw mills in the past five years, large land holding, prior experience with state/federal financial/technical support programs, among other factors, lead to smaller proportion of non-forested land being allocated for pine. However, a higher price offer, stronger preference for producing non-timber forest products such as evergreen boughs and grapevine, and lesser dependence on working the land for annual income lead to larger proportion of non-forested land being allocate for pine. Our results could assist policy makers in developing and improving land use and energy policies, certification programs, and extension and outreach services. Our contribution also includes the use of threshold analyses to delineate tipping points in variables associated with different response rates and showing the different effect of variables in terms of how they affect the supply of biomass and the supply of land for bioenergy purposes

Factors Affecting Willingness to Cultivate Switchgrass: Evidence from a Farmer Survey in Missouri

Switchgrass is considered as one of the important feedstocks that can contribute towards the attainment of bioenergy goals set under the Renewable Fuels Standard. Yet, the commercial viability of switchgrass based bioenergy is a much debated topic owing to supply side challenges emanating from limited raw materials. It is therefore critical to understand the crucial role of the farmer by studying the willingness to cultivate switchgrass dedicated for bioenergy. To our knowledge, this is the first survey undertaken to assess the farmer preferences and participation in bioenergy markets after the new administration has assumed office, and provides some important insights. Our analysis reveals that the risk attitudes of farmers have an important bearing on their willingness to cultivate switchgrass. Having prior awareness of switchgrass makes farmers less likely to adopt whereas a preference to cultivate a crop after seeing them on demonstration plots at university extension meetings positively influences willingness decisions. Landholdings under pasture/grazing use and under forest/woodland use increases farmer willingness to cultivate switchgrass. On the other hand, having land under the Conservation Reserve Program, lands that experienced flooding or water stress in recent years, or lands that confront erosion issues did not have a significant influence on farmer willingness. While the inherent uncertainty of the cellulosic bioenergy industry is well known, policies that provide a safety net to protect farmers from the downside are an important issue for farmers who are willing to cultivate switchgrass

Soil and Water Conservation using the Socioeconomics, Sustainability Concerns, and Policy Preference for Residual Biomass Harvest

While woody bioenergy opens up a new market opportunity for residual biomass, overharvesting of residual biomass can adversely affect soil health, water quality, timber health and stand productivity, among others. As such, it is important to understand the proportion of residual biomass forestland owners are willing to leave unharvested for soil nutrient and other environmental benefit purposes, their sustainability concerns, and policy preferences. Toward this end, we conducted a mail survey on 900 randomly selected forestland owners in Virginia and used ordinal logistic regression, cluster analyses, and Cochran-Armitage trend tests to analyze the data. Our analyses of the 121 most complete responses suggest that factors such as ownership tenure, mode of land acquisition, size of forestland, and forestland ownership objectives, among other factors, affect decisions regarding the proportion of residual biomass forestland owners choose to leave unharvested. Analyses of landowners\u27 sustainability concerns indicate a clustering pattern, where concerns about sufficiency of best management practices and the potential implications of harvest decision on soil and water quality are among the statistical representatives of their respective clusters. Respondents likely to engage in harvest practices that do not leave any residual biomass on the ground have a preference for policies that help cover management cost. Decision makers administering or considering such policy proposals should be aware of the inadvertent effect such cost sharing arrangements can have in encouraging unsustainable practices. These results also hint at the potential need for combining such cost sharing arrangements with extension and outreach programs. By accounting for landowners\u27 concerns and preferences, this study complements previous studies that primarily adopt engineering based approaches and solutions

Assessment of Switchgrass-Based Bioenergy Supply Using GIS-Based Fuzzy Logic and Network Optimization in Missouri (U.S.A.)

Bioenergy has been globally recognized as one of the sustainable alternatives to fossil fuels. An assured supply of biomass feedstocks is a crucial bottleneck for the bioenergy industry emanating from uncertainties in land-use changes and future prices. Analytical approaches deriving from geographical information systems (GIS)-based analysis, mathematical modeling, optimization analyses, and empirical techniques have been widely used to evaluate the potential for bioenergy feedstock. In this study, we propose a three-phase methodology integrating fuzzy logic, network optimization, and ecosystem services assessment to estimate potential bioenergy supply. The fuzzy logic analysis uses multiple spatial criteria to identify suitable biomass cultivating regions. We extract spatial information based on favorable conditions and potential constraints, such as developed urban areas and croplands. Further, the network analysis uses the road network and existing biorefineries to evaluate feedstock production locations. Our analysis extends previous studies by incorporating biodiversity and ecologically sensitive areas into the analysis, as well as incorporating ecosystem service benefits as an additional driver for adoption, ensuring that biomass cultivation will minimize the negative consequences of large-scale land-use change. We apply the concept of assessing the potential for switchgrass-based bioenergy in Missouri to the proposed methodology