BIOFUEL AND POLICY ALTERNATIVES: A FARM LEVEL ANALYSIS

Adele Finco, Monica Padella, Romina Spinozzi and Andrea Benedetti

No 188088, 14th ICABR Conference, June 16-18, 2010, Ravello, Italy from International Consortium on Applied Bioeconomy Research (ICABR)

Abstract: Within the past years, there has been a significant movement in political consensus towards an energy future with a substantially larger renewable energy component both in Europe and Italy. The biofuel industry has been experiencing a period of extraordinary growth, fueled by a combination of high oil prices, and ambitious blending mandates, tax exemptions and import protection. The major drivers are the reduction of greenhouse gas emissions and fossil fuel use, increased awareness of fossil fuels’ contribution to global climate change, the desire to promote economic revitalization in rural areas and the possibility to create new markets for agricultural products. This paper examines the history of European and Italian biodiesel policy and evaluates the economics of biodiesel production in today’s market environment in Italy. The aim is to shed light on the prospective of the industry and to understand the impacts of policy alternatives. The study is motivated by the increase in biodiesel production capacity realized in Italy in the past years, in contrast whit the actual scenario, emerged from Italian plant managers interviews. We develop an analysis at the firm level to review factors which have contributed to the boom in biodiesel production. The analysis is built upon the work developed by Tyner and Taheripuor for ethanol (2008). It’s based on a break-even comparison for combinations of rapeseed and biodiesel prices which keep a representative biodiesel plant at the zero profit condition. The aim is to examine the profitability of Italian biodiesel industry in 2004-2009.

Keywords: Environmental Economics and Policy; Farm Management (search for similar items in EconPapers)
Pages: 27
Date: 2010
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Persistent link: https://EconPapers.repec.org/RePEc:ags:itic10:188088

DOI: 10.22004/ag.econ.188088

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