GHG Trading Framework for the U.S. Biofuels Sector
Subbu Kumarappan and
Satish V. Joshi
No 54530, Environmental and Rural Development Impacts Conference, October 15-16, 2008, St. Louis, Missouri from Farm Foundation, Transition to a Bio Economy Conferences
Substitution of petroleum fuels with biofuels such as ethanol and biodiesel has been shown to reduce greenhouse gas (GHG) emissions. These GHG reductions can be traded in the emerging carbon markets, and methodologies for quantifying and trading are still being developed. The main challenges in developing such GHG trading framework are analyzed. An outline of such a framework is presented that depends on the life cycle assessment of GHG reductions, along with a combination of project specific and regional standard performance measures. The advantages of assigning GHG property and trading rights to biofuel producers are discussed. At carbon prices of $10 per metric ton, estimated additional revenues to biofuel producers range from $ 17 to 64 million dollars per billion gallons of corn ethanol and cellulosic ethanol respectively.
Keywords: Environmental; Economics; and; Policy (search for similar items in EconPapers)
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