Economic analysis of utilization of corn stover for bioenergy production
Bioenergy production from plant wastes such as corn stover has the potential to improve energy security, and mitigate climate change in the United States. However, there is a limited understanding of its utilization, and economic potentials for bioenergy production. Corn stover is the non-grain portion of the corn plant and consists of residues left on a corn field after corn is harvested, which includes leaves, stalks, husk, and cobs. The overall objective of the study is to estimate the economic profitability of utilization of corn stover for different ventures after harvesting corn. The specific objectives of the study were to: (i) estimate economic returns from marketing corn stover to ethanol biorefineries, (ii) evaluate profitability of utilization of corn stover by ethanol producers, and (iii) evaluate investment opportunities for on-farm gasifiers for electricity generation from corn stover. The data for this study was based on secondary data from various sources. Benefit-cost model and Monti Carlo simulation was applied for the analysis. The analysis focused on feedstock for biofuel production over a 10-year project period. Investment evaluation criteria include annualized net return from various options and, breakeven price of feedstock, ethanol, and electricity. Simulations and Sensitivity analysis of net returns to changing stover yield, and conversion technology was also carried out. Results show that under current conversion rate, the annual equivalent net return from marketing corn stover ranges from $35.95 to $175.81/acre, while the net return from ethanol production ranges from -$11.93 – $97.66/ ton of corn stover. The estimated breakeven price of ethanol from corn stover ranges from $1.94 – $2.27/gallon of ethanol. Also, under the government subsidy scheme that covers 25% of equipment costs, there is an investment opportunity for on-farm gasifier with an NPV of $4201.65/acre. The findings of the study show the potential for using corn stover for bioenergy production since it showed a positive net return. In addition, production of ethanol from corn stover is not only economically feasible but also socially acceptable since it does not compete with food production, and serves as a means of income diversification for corn farmers.
Ibukun D Alegbeleye,
"Economic analysis of utilization of corn stover for bioenergy production"
ETD Collection for Tennessee State University.