Economic and legal conditions and profitability of investments in agricultural biogas plants in Poland

Piotr Sulewski, Edward Majewski, Adam Wąs, Magdalena Szymańska, Agata Malak-Rawlikowska, Aleksandra Fraj, Adrian Trząski, Andrzej Wiszniewski and Marek Ambrozy

No 249739, Problems of Agricultural Economics / Zagadnienia Ekonomiki Rolnej from Institute of Agricultural and Food Economics - National Research Institute (IAFE-NRI)

Abstract: The paper analyses profitability of biogas production in livestock farms in Poland with a focus on micro-biogas plants. Due to the high value of investments a crucial issue, from the farmers’ point of view, is the mechanism of financial support. The efficiency of investments has been measured assuming three variants of power of CHP plants. In addition, two scenarios of financial support have been taken into consideration: the “old” mechanism of green certificates and a forthcoming mechanism based on the new Act on Renewable Energy Resources. The new system introduces feed-in tariffs for small plants and auctions and guarantees of purchase for larger biogas plants. The results of the analyses indicate a strong dependence of the financial effects of micro-biogas plants on subsidies. It can be concluded that, under the current state of market development and financial support offered to micro-scale biogas production, investments in biogas plants are in general unprofitable.

Keywords: Environmental Economics and Policy; Land Economics/Use; Resource /Energy Economics and Policy (search for similar items in EconPapers)
Pages: 24
Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:ags:iafepa:249739

DOI: 10.22004/ag.econ.249739

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