The economic and environmental costs and benefits of the renewable fuel standard
Abstract
Abstract Mandates, like the renewable fuel standard (RFS), for biofuels from corn and cellulosic feedstocks, impact the environment in multiple ways by affecting land use, nitrogen (N)-leakage, and greenhouse gas (GHG) emissions. We analyze the differing trade-offs these different types of biofuels offer among these multi-dimensional environmental effects and convert them to a monetized value of environmental damages (or benefits) that can be compared with the economic costs of extending these mandates over the 2016–2030 period. The discounted values of cumulative net benefits (or costs) are then compared to those with a counterfactual level of biofuels that would have been produced in the absence of the RFS over this period. We find that maintaining the corn ethanol mandate at 56 billion l till 2030 will lead to a discounted cumulative value of an economic cost of $199 billion over the 2016–2030 period compared to the counterfactual scenario; this includes $109 billion of economic costs and $85 billion of net monetized environmental damages. The additional implementation of a cellulosic biofuel mandate for 60 billion l by 2030 will increase this economic cost by $69 billion which will be partly offset by the net discounted monetized value of environmental benefits of $20more »
- Publication Date:
- Research Org.:
- Center for Advanced Bioenergy and Bioproducts Innovation (CABBI), Urbana, IL (United States)
- Sponsoring Org.:
- USDOE Office of Science (SC), Biological and Environmental Research (BER)
- OSTI Identifier:
- 1835479
- Alternate Identifier(s):
- OSTI ID: 1769410
- Grant/Contract Number:
- SC0018420
- Resource Type:
- Published Article
- Journal Name:
- Environmental Research Letters
- Additional Journal Information:
- Journal Name: Environmental Research Letters Journal Volume: 16 Journal Issue: 3; Journal ID: ISSN 1748-9326
- Publisher:
- IOP Publishing
- Country of Publication:
- United Kingdom
- Language:
- English
- Subject:
- 54 ENVIRONMENTAL SCIENCES; social cost of carbon; social cost of nitrogen; cost–benefit analysis; indirect land use change
Citation Formats
Chen, Luoye, Debnath, Deepayan, Zhong, Jia, Ferin, Kelsie, VanLoocke, Andy, and Khanna, Madhu. The economic and environmental costs and benefits of the renewable fuel standard. United Kingdom: N. p., 2021.
Web. doi:10.1088/1748-9326/abd7af.
Chen, Luoye, Debnath, Deepayan, Zhong, Jia, Ferin, Kelsie, VanLoocke, Andy, & Khanna, Madhu. The economic and environmental costs and benefits of the renewable fuel standard. United Kingdom. https://doi.org/10.1088/1748-9326/abd7af
Chen, Luoye, Debnath, Deepayan, Zhong, Jia, Ferin, Kelsie, VanLoocke, Andy, and Khanna, Madhu. Wed .
"The economic and environmental costs and benefits of the renewable fuel standard". United Kingdom. https://doi.org/10.1088/1748-9326/abd7af.
@article{osti_1835479,
title = {The economic and environmental costs and benefits of the renewable fuel standard},
author = {Chen, Luoye and Debnath, Deepayan and Zhong, Jia and Ferin, Kelsie and VanLoocke, Andy and Khanna, Madhu},
abstractNote = {Abstract Mandates, like the renewable fuel standard (RFS), for biofuels from corn and cellulosic feedstocks, impact the environment in multiple ways by affecting land use, nitrogen (N)-leakage, and greenhouse gas (GHG) emissions. We analyze the differing trade-offs these different types of biofuels offer among these multi-dimensional environmental effects and convert them to a monetized value of environmental damages (or benefits) that can be compared with the economic costs of extending these mandates over the 2016–2030 period. The discounted values of cumulative net benefits (or costs) are then compared to those with a counterfactual level of biofuels that would have been produced in the absence of the RFS over this period. We find that maintaining the corn ethanol mandate at 56 billion l till 2030 will lead to a discounted cumulative value of an economic cost of $199 billion over the 2016–2030 period compared to the counterfactual scenario; this includes $109 billion of economic costs and $85 billion of net monetized environmental damages. The additional implementation of a cellulosic biofuel mandate for 60 billion l by 2030 will increase this economic cost by $69 billion which will be partly offset by the net discounted monetized value of environmental benefits of $20 billion, resulting in a net cost of $49 billion over the 2016–2030 period. We explore the sensitivity of these net (economic and environmental) costs to alternative values of the social costs of carbon and nitrogen and other technological and market parameters. We find that, unlike corn ethanol, cellulosic biofuels can result in positive net benefits if the monetary benefits of GHG mitigation are valued high and those of N-damages are not very high.},
doi = {10.1088/1748-9326/abd7af},
journal = {Environmental Research Letters},
number = 3,
volume = 16,
place = {United Kingdom},
year = {Wed Feb 17 00:00:00 EST 2021},
month = {Wed Feb 17 00:00:00 EST 2021}
}
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