1 For parameters with an assumed skewed distribution in Monte Carlo analysis, the “likeliest” value denotes the value with the highest probability density.
2 Harvest and maintenance costs were updated using USDA-NASS agricultural fuel, machinery, and labor prices from 1999-2007 (USDA-NASS, 2007a,b).
3 Based on a conversion rate of 0.59 dry tons per green tons.
4 Northeast includes Pennsylvania, New Jersey, New York, Connecticut, Massachusetts, Rhode Island, Vermont, New Hampshire, and Maine. South refers to Delaware, Maryland, West Virginia, Virginia, North Carolina, South Carolina, Kentucky, Tennessee, Florida, Georgia, Alabama, Mississippi, Louisiana, Arksansas, Texas, and Oklahoma. States in the North region are Minnesota, Wisconsin, Michigan, Iowa, Missouri, Illinois, Indiana, and Ohio. West includes South Dakota, Wyoming, Colorado, New Mexico, Arizona, Utah, Montana, Idaho, Washington, Oregon, Nevada, and California.
5 Transportation costs were updated using USDA-NASS agricultural fuel prices from 1999-2007 (USDA-NASS, 2007a,b).
6 The authors’ simplifying assumption of uniform density is maintained.
7 Although the biomass density for a corn-soybean rotation is assumed to be 0.20, the value used to calculate the average hauling distance for stover from a corn-soybean rotation is 0.10 since only half of the acreage is in corn at any given point in time.
8 From the rotation calculator provided by the Iowa State University extension services with a corn price of $4 per bushel, a soybean price of $10 per bushel, and a yield penalty of 7 bushels per acre, the lost net returns to switching from a corn-soybean rotation to continuous corn is about $62 per acre (http://www.extension.iastate.edu/agdm/crops/html/al-20.html). Previous literature that has attributed an opportunity cost to stover based on lost profits from switching from a corn-soybean rotation to continuous corn production has assumed an opportunity cost between $22 and $140 per acre (Khanna and Dhungana, 2007; Duffy, 2010).
9 This value is a lower bound because forestry still had positive net growth over this period.
10 Plot trials were evaluated at 80 percent of their estimated yield.
11 This is a significantly lower assumed yield than previous research has assumed or simulated (Khanna and Dhungana, 2007; Khanna et al., 2008; Khanna, 2008; Heaton et al., 2004).
|Supplier Breakeven - Parameter Assumptions|
|Parameter||Feedstock||Mean Value (Likeliest if Skewed)||Statistical Distribution of Cost Estimates1|
|Nutrient Replacement (CNR)||Stover||$13.6/ton ($14.6)||Minimum Extreme|
|Switchgrass (All)||$15.6/ton ($16.6)||Minimum Extreme|
|Forest Residue||$62.5/acre (~$15.6/ton)||Fixed|
|Alfalfa (2nd year)|
|Harvest and Maintenance (CHM)||Stover||$43/ton ($46)||Minimum Extreme|
|Switchgrass (All)||$36/ton ($38)||Minimum Extreme|
|Miscanthus (All)||$45/ton ($48)||Minimum Extreme|
|Wheat Straw||$32/ton ($33)||Minimum Extreme|
|Alfalfa||$57 per acre per harvest||Fixed|
|Stumpage Fee (SF)||SRWC||$20/ton||Normal|
|Distance Fixed Cost (DFC)||Stover||$8.50/ton||Normal|
Below are the first 10 and last 10 pages of uncorrected machine-read text (when available) of this chapter, followed by the top 30 algorithmically extracted key phrases from the chapter as a whole.
Intended to provide our own search engines and external engines with highly rich, chapter-representative searchable text on the opening pages of each chapter. Because it is UNCORRECTED material, please consider the following text as a useful but insufficient proxy for the authoritative book pages.
Do not use for reproduction, copying, pasting, or reading; exclusively for search engines.
OCR for page 351
L BioBreak Model Assumptions Supplier Breakeven - Parameter Assumptions Statistical Mean Value Distribution of Cost Estimates1 Parameter Feedstock (Likeliest if Skewed) Nutrient Replacement (CNR) Stover $13.6/ton ($14.6) Minimum Extreme Switchgrass (All) $15.6/ton ($16.6) Minimum Extreme Miscanthus (All) $8.35/ton Normal Wheat Straw $5.6/ton Normal Short-rotation woody - - crops (SRWC) - - Forest Residue $62.5/acre (~$15.6/ton) Fixed Alfalfa (2nd year) Harvest and Maintenance (CHM) Stover $43/ton ($46) Minimum Extreme Switchgrass (All) $36/ton ($38) Minimum Extreme Miscanthus (All) $45/ton ($48) Minimum Extreme Wheat Straw $32/ton ($33) Minimum Extreme SRWC $26/ton Normal Forest Residue $26/ton Normal Alfalfa $57 per acre per harvest Fixed Stumpage Fee (SF) SRWC $20/ton Normal Distance Fixed Cost (DFC) Stover $8.50/ton Normal Switchgrass (All) $8.50/ton Normal Miscanthus (All) $8.50/ton Normal Wheat Straw $8.50/ton Normal SRWC $10/ton Normal Forest Residue $10/ton Normal Alfalfa $8.50/ton Normal 351
OCR for page 351
352 APPENDIX L Supplier Breakeven - Parameter Assumptions Statistical Mean Value Distribution of Cost Estimates1 Parameter Feedstock (Likeliest if Skewed) Distance Variable Cost (DVC) Stover $0.35/ton/mile ($0.38) Minimum Extreme Switchgrass (All) $0.35/ton/mile ($0.38) Minimum Extreme Miscanthus (All) $0.35/ton/mile ($0.38) Minimum Extreme Wheat Straw $0.35/ton/mile ($0.38) Minimum Extreme SRWC $0.50/ton/mile ($0.53) Minimum Extreme Forest Residue $0.50/ton/mile ($0.53) Minimum Extreme Alfalfa $0.35/ton/mile ($0.38) Minimum Extreme Distance2 Stover (CS) 36 miles Fixed Stover/Alfalfa 26 miles Fixed Alfalfa 43 miles Fixed Switchgrass (MW) 19 miles Fixed Switchgrass (MW_low) 21 miles Fixed Switchgrass (App) 15 miles Fixed Switchgrass (SC) 16 miles Fixed Miscanthus (MW) 13 miles Fixed Miscanthus (MW_low) 14 miles Fixed Miscanthus (App) 13 miles Fixed Wheat Straw 37 miles Fixed SRWC 17 miles Fixed Forest Residue 53 miles Fixed 772,000 tons3 Annual Biomass Demand (BD) All Fixed Yield (YB) Stover (CS) 2.1 tons Gamma Alfalfa (1st year) 1.25 tons Fixed Alfalfa (2nd year) 4 tons Fixed Switchgrass (MW) 4 tons (3.4) Maximum Extreme Switchgrass (MW_low) 3.1 tons Log Normal Switchgrass (App) 6 tons (5) Maximum Extreme Switchgrass (SC) 5.7 tons Beta Miscanthus (MW) 8.6 tons (8) Maximum Extreme Miscanthus (MW_low) 7.1 tons (6) Maximum Extreme Miscanthus (App) 8.8 tons (8) Maximum Extreme Wheat Straw 1 ton Normal SRWC 5 tons Normal Forest Residue 0.5 tons Normal Biomass Density (B) Alfalfa 0.15 Normal Other Feedstocks 0.20 Normal Storage (CS) Stover $10.50/ton ($11) Minimum Extreme Switchgrass (All) $10.50/ton ($11) Minimum Extreme Miscanthus (All) $10.50/ton ($11) Minimum Extreme Wheat Straw $10.50/ton ($11) Minimum Extreme SRWC $11.50/ton ($12) Minimum Extreme Forest Residue $11.50/ton ($12) Minimum Extreme Alfalfa $10.50/ton ($11) Minimum Extreme Establishment and Seeding (CES) 4,5 Stover - - Switchgrass (All) $40/acre Log Normal Miscanthus (All) $150/acre Log Normal Wheat Straw - - SRWC $52/acre Normal Forest Residue - - Alfalfa (1st year w/ fert) $165/acre Fixed
OCR for page 351
353 APPENDIX L Supplier Breakeven - Parameter Assumptions Statistical Mean Value Distribution of Cost Estimates1 Parameter Feedstock (Likeliest if Skewed) Opportunity Cost (COpp) Stover (CS) - - $150/acre6 Switchgrass (MW) Log Normal Switchgrass (MW_low) $100/acre Log Normal Switchgrass (App) $75/acre Normal Switchgrass (SC) $50/acre Normal Miscanthus (MW) $150/acre Log Normal Miscanthus (MW_low) $100/acre Log Normal Miscanthus (App) $75/acre Normal Wheat Straw $1.80/acre ($0) Maximum Extreme SRWC - - Forest Residue - - Alfalfa (1st year w/ fert) $175/acre Fixed Processor Breakeven - Parameter Assumptions Mean Value in Baseline Parameter Feedstock (Likeliest if Skewed) Distribution Oil Price (POil) All $52/barrel Fixed $111/barrel (3 scenarios) $191/barrel Energy Equivalent Factor (EV) All 0.68 (0.65) Maximum Extreme Tax (T) All $1.01/gal Fixed Byproduct value (VBP) Stover $0.16/gal Fixed Switchgrass (All) $0.18/gal Fixed Miscanthus (All) $0.18/gal Fixed Wheat Straw $0.18/gal Fixed SRWC $0.14/gal Fixed Forest Residue $0.14/gal Fixed Alfalfa $0.18/gal Fixed Octane (VO) All $0.10/gal Fixed Capital Cost (CI) All $0.91/gal ($0.85) Maximum Extreme Non-enzyme Operating Cost All $0.36/gal Fixed Enzyme Cost All $0.50/gal ($0.46) Minimum Extreme Yield (YE) All – current 70 gal/ton Normal All – future 80 gal/ton Normal 1 The cost estimates taken from several published studies cited in Appendix L are not necessarily normally dis- tributed. This column reﬂects the statistical distribution that the cost observations tended to best ﬁt and that was used in the Monte Carlo process to derive statistical “mean” and “most likely values” if the statistical distribution of costs was skewed. 2 Average hauling distance is calculated using the formulation by French (1960) for a circular supply area with a square road grid. Technically, the distance is not ﬁxed since it is a function of stochastic parameters including biomass density and yield. French, B. 1960. Some considerations in estimating assembly cost functions for agri- cultural processing operations. Journal of Farm Economics 62:767-778. 3 Equivalent to 2,205 tons per day delivered to a bioreﬁnery operating 350 days per year. 4 Switchgrass establishment seeding cost is amortized over 10 years at 10 percent, Miscanthus establishment and seeding cost is amortized over 20 years at 10 percent, and woody biomass is amortized over 15 years at 10 percent. The values presented in the table are annual payments per acre. 5 All per acre costs are converted to per ton costs using the yield assumptions provided in the table. 6 Midwest opportunity cost is assumed to be positively correlated with corn yield through stover yield with a correlation of 0.75.
OCR for page 351