Sustainability of Biomass Feedstock Production, Removal, and Transport Optimization
Remegio B. Confesor Jr.1, Gerald Whittaker2, Rolf Färe3, and Shawna Grosskopf3. (1) Agricultural and Resource Economics, Oregon State University, 3450 SW Campus Way, Corvallis, OR 97331, (2) Nfsprc, USDA-ARS, 3450 SW Campus Way, Corvallis, OR 97331, (3) Economics, Oregon State University, 312 Ballard Extension Hall, Corvallis, OR 97331
The research in conversion of agricultural biomass into ethanol has gained momentum due to high price of petroleum, the demand to reduce greenhouse gas emissions, and the recent US government policy on reducing foreign oil dependence. However, research in production and supply technologies should also be done in conjunction with ethanol conversion development. One challenge is in the collection, packaging, storage, and transport processes of the materials from the field to biomass refineries. This paper integrates the above processes into an optimized economic production model. We present a method that employs Shephard's activity analysis output model that is similar to the Data Envelopment Analysis (DEA). Activity analysis has been used to measure the efficiency and profitability of many agricultural and industrial production processes. The method that we propose to apply models dynamic production processes and intermediate production, among many other components of a production process. Shadow prices for undesirable outputs (pollutants) can also be calculated. Activity analysis is implemented in a linear program to calculate the optimum combination of inputs (costs) and outputs (revenues) of production processes, and can be dynamically linked to biophysical models to include environmental effects of production. The results of this study may be used to assess the efficiency and economic viability of alternative technologies employed in agricultural biomass removal and transport for ethanol production.