Financial Feasibility of Short Rotation Energy Crops in Hungary: A Case Study

Zsuzsanna Deák and Árpád Ferencz

Roczniki (Annals), 2017, vol. 2017, issue 3

Abstract: Biomass is a readily available, renewable and environmentally friendly source of energy. Exploiting renewable organic matter for energy production is showing a growing tendency worldwide including in Hungary. Forest plantations with large numbers of plants (short rotation coppices) that provide a homogeneous, locally available raw material of various fast growing deciduous wood species are broadly supported. In our research we have investigated the financial viability of a short rotation energy forest plantation in the Kunság region of Hungary. Both the EU and Hungary provide economic incentives for the creation and propagation of bio-energy producing facilities. Our results show that the enterprise could not generate profit for the period examined without the help of such subsidies. There are several obstacles that farmers are facing such as the initial high capital outlay, technological shortcomings of the harvesting methods, high logistics costs and suppressed purchasing prices.

Keywords: Agribusiness; Resource/Energy Economics and Policy (search for similar items in EconPapers)
Date: 2017
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Persistent link: https://EconPapers.repec.org/RePEc:ags:paaero:293537

DOI: 10.22004/ag.econ.293537

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