Economic risk-based analysis: Effect of technical and market price uncertainties on the production of glycerol-based isobutanol

Research output: Chapter in Book/Report/Conference proceedingArticle in proceedingsResearchpeer-review

Abstract

In this study, the production of glycerol-based isobutanol is critically assessed in terms of its techno-economic performance through the estimation of economic indicators, net present value (NPV) and minimum selling price (MSP). The Monte Carlo method with Latin Hypercube Sampling (LHS) is used to propagate the market price and technical uncertainties to the economic indicator calculations and to quantify the respective economic risk. The results clearly indicated that under the given market price uncertainties, the probability of obtaining a negative NPV is 0.95. This is a very high probability of failure, which corresponds to an economic risk of 20 MM$ as a potential loss. In order to decrease the economic risk, the integrated production of isobutanol as a module added to the biodiesel plant was tested as an alternative scenario. The probability of a negative NPV is decreased from 0.95 to 0.2 and the corresponding economic risk was reduced from 20 to 0.64 MM$. Using the integrated concept of utilising the waste glycerol stream in biodiesel plants contributes to the diversification of the product portfolio for vegetable oil based biorefineries, and in turn improves cost-competitiveness and robustness against market price fluctuations.
Original languageEnglish
Title of host publication Proceedings of the 26th European Symposium on Computer Aided Process Engineering
EditorsZdravko Kravanja, Miloš Bogataj
Number of pages6
Volume38
PublisherElsevier
Publication date2016
ISBN (Electronic)978-0-444-63428-3
DOIs
Publication statusPublished - 2016
Event26th European Symposium on Computer-Aided Process Engineering - Grand Hotel Bernardin Congress Centre, Portorož , Slovenia
Duration: 12 Jun 201615 Jun 2016
http://escape26.um.si/

Conference

Conference26th European Symposium on Computer-Aided Process Engineering
LocationGrand Hotel Bernardin Congress Centre
CountrySlovenia
CityPortorož
Period12/06/201615/06/2016
Internet address
SeriesComputer Aided Chemical Engineering
Volume38
ISSN1570-7946

Keywords

  • Net Present Value
  • Uncertainty analysis
  • Risk
  • Isobutanol

Fingerprint Dive into the research topics of 'Economic risk-based analysis: Effect of technical and market price uncertainties on the production of glycerol-based isobutanol'. Together they form a unique fingerprint.

Cite this