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The Economics of Harvesting and Transporting Hardwood Forest Residue for Conversion to Fuel Ethanol: A Case Study for Minnesota

Daniel Petrolia ()

No 14020, Staff Papers from University of Minnesota, Department of Applied Economics

Abstract: Forest residues are being considered as potential feedstock for a biomass-to-ethanol facility in Minnesota (USA), using residues from major wood-producing counties in Minnesota, Wisconsin, and Michigan. Results indicate that marginal residue costs delivered to a conversion facility would be $56-80/Mg for a small (95-189 MM liters) plant, and about $81/Mg for a larger (379 MM liters) plant. Output beyond these levels would involve substitution of lower-cost market pulpwood as the plant feedstock because of relatively high marginal residue costs. Sensitivity analysis indicates that either a 20-percent increase or decrease in the quantity of available residue would impact marginal cost estimates by no more than $15/Mg.

Keywords: Resource; /Energy; Economics; and; Policy (search for similar items in EconPapers)
Pages: 29
Date: 2006
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DOI: 10.22004/ag.econ.14020

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