Stochastic techno-economic considerations in biodiesel production

Abubakar, Usman; Sriramula, Srinivas; Renton, Neill C.

doi:10.1016/j.seta.2014.10.002

Cited by 16 publications

(13 citation statements)

References 29 publications

(69 reference statements)

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“…Bauer and Hulteberg [20] developed a probability distribution for production cost using Monte Carlo simulation when evaluating a new thermochemical production process for isobutanol. Abubakar et al [21] graphed the variations of mean NPV with the increase of the sample size. Sensitivity analyses conducted by Reyes Valle et al [22] estimated how breakeven prices respond to ±30% uncertainty in fixed capital costs.…”

Section: Introductionmentioning

confidence: 99%

Stochastic techno-economic analysis of alcohol-to-jet fuel production

Yao

Staples

Malina

et al. 2017

Biotechnol Biofuels

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BackgroundAlcohol-to-jet (ATJ) is one of the technical feasible biofuel technologies. It produces jet fuel from sugary, starchy, and lignocellulosic biomass, such as sugarcane, corn grain, and switchgrass, via fermentation of sugars to ethanol or other alcohols. This study assesses the ATJ biofuel production pathway for these three biomass feedstocks, and advances existing techno-economic analyses of biofuels in three ways. First, we incorporate technical uncertainty for all by-products and co-products though statistical linkages between conversion efficiencies and input and output levels. Second, future price uncertainty is based on case-by-case time-series estimation, and a local sensitivity analysis is conducted with respect to each uncertain variable. Third, breakeven price distributions are developed to communicate the inherent uncertainty in breakeven price. This research also considers uncertainties in utility input requirements, fuel and by-product outputs, as well as price uncertainties for all major inputs, products, and co-products. All analyses are done from the perspective of a private firm.ResultsThe stochastic dominance results of net present values (NPV) and breakeven price distributions show that sugarcane is the lowest cost feedstock over the entire range of uncertainty with the least risks, followed by corn grain and switchgrass, with the mean breakeven jet fuel prices being $0.96/L ($3.65/gal), $1.01/L ($3.84/gal), and $1.38/L ($5.21/gal), respectively. The variation of revenues from by-products in corn grain pathway can significantly impact its profitability. Sensitivity analyses show that technical uncertainty significantly impacts breakeven price and NPV distributions.ConclusionsTechnical uncertainty is critical in determining the economic performance of the ATJ fuel pathway. Technical uncertainty needs to be considered in future economic analyses. The variation of revenues from by-products plays a significant role in profitability. With the distribution of breakeven prices, potential investors can apply whatever risk preferences they like to determine an appropriate bid or breakeven price that matches their risk profile.Electronic supplementary materialThe online version of this article (doi:10.1186/s13068-017-0702-7) contains supplementary material, which is available to authorized users.

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Section: Introductionmentioning

confidence: 99%

Stochastic techno-economic analysis of alcohol-to-jet fuel production

Yao

Staples

Malina

et al. 2017

Biotechnol Biofuels

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“…It is an additional performance measure to predict the cost-efficiency of the projects in the face of a number of uncertainty sources. The stochastic techno-economic analysis approach combines the first-order reliability method and Monte Carlo simulation to measure the probability of success/ failure and economic indicators for a catalyzed biodiesel production plant [18]. A study showed that an intensified process could reduce the investment risk of a large-scale chemical plant due to a decrease in the number of unit operations and their sizes [19].…”

Section: Introductionmentioning

confidence: 99%

Economic and Risk Analyses of an Industrial N,N‐Dimethylformamide Recovery Process

Shi

et al. 2019

Chem Eng & Technol

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The industrial N,N-dimethylformamide (DMF) recovery plant is usually based on a two-column sequence (TCS) and the capacity of the wastewater treatment process is larger than 2000 kg h -1 . Here, a dividing-wall column (DWC)-based DMF recovery plant is proposed. The DWC avoids the remixing effect and reduces the utility duties by about 18.1 % and the CO 2 emissions by 15.2 %, compared to the TCS. The DWC effectively decreases the total annual cost by 3.4 % compared to that of the TCS and achieves a profitability index of 2.19 and an internal rate of return of 40.45 %. By Monte Carlo risk analysis, the DWC can increase the chance of earning the profit by up to 16 % compared to the TCS.

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“…22 Some researchers have investigated the TEAs of biodiesel production subjected to uncertain parameters. [23][24][25] They have found that the uncertainties in the parameters can considerably affect the TEAs. The authors also analysed the effects of uncertainties on the TEAs of biodiesel production and identied the key parameters.…”

Section: Introductionmentioning

confidence: 99%