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The economic potential of producing energy from agricultural biomass
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Agricultural biomass is a substitute for fossil fuels, which could provide a sustained energy feedstock and possibly reduce further accumulations of greenhouse gases. However, these feedstocks currently face a market dominated by low cost fossil fuels; hence, are largely unable to be supplied at a competitive price. This study examined how forcing increased biomass energy generation, along with improvements in biomass production technology, will impact agricultural feedstock prices and economically impact the well-being of the agricultural sector. An U.S. agricultural sector model, a dynamic, nonlinear, mathematical program, determined the economic effects of using increased supplies of agricultural biomass for energy. The model incorporated production and use of potential biomass energy feedstocks, such as switchgrass and short rotation poplar. Also, the model introduced future biomass technologies, based on current research involving more productive biomass crops and more efficient conversion activities which produce ethanol and biomass electricity. The forced supply of new biomass crops, along with corn, involves several levels of energy production. This forced supply was based on projected ethanol demands and land capability for biomass production. The model determined the optimal mix of corn and energy crops to meet the biomass feedstock goals for energies. The resultant model appraises the effects of increasing biomass feedstocks for the years 1990, 2000, 2010, and 2020. The results show that initially, fuel prices using biomass feedstocks may be as much as 50 % greater than equivalent fossil fuel supplied energy. But due to technology the price of biomass feedstocks decreases over time. The analysis predicts that the agricultural feedstock price and the price of fossil fuels may equalize between the years 201 0 and 2020. The forced production of agricultural energy crops changes cropping patterns and prices for conventional crops as well. The agricultural energy crops and corn receive a greater allocation of farm land to meet the forced biomass energy supplies. Most conventional crop prices rise and all biomass feedstock prices rise with increasing feedstock production. As a consequence, farmers receive increased profits. Consumers, however, experience a loss in well-being due to the higher cost of energy feedstock and food products. National well-being experiences a net loss.
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Jerko, Christine (1996). The economic potential of producing energy from agricultural biomass. Master's thesis, Texas A&M University. Available electronically from
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