Economic risk analysis and environmental life cycle assessment of bio-energy systems

Sajid, Zaman (2017) Economic risk analysis and environmental life cycle assessment of bio-energy systems. Doctoral (PhD) thesis, Memorial University of Newfoundland.

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Abstract

Being depletable, scarce, hostile to the environment and non-renewable in nature, petroleum-based fossil fuels are diminishing much faster than a decade ago. These scarcity concerns, negative environmental consequences and the gradual depletion of petroleum fuels have led to explore alternate, inexhaustible and renewable energy resources. One promising energy resource is biofuel, which is produced from renewable biomass feedstock. The reasons for sustainability and viability of biofuels are that they are economically feasible to produce and have positive environmental impacts. Since biofuels research is quite diversified, the sustainability and viability of biofuels face many challenges. This thesis investigates existing and future technological and knowledge challenges and proposes new methods to improve bio-energy sustainability both economically and environmentally. The economic viability of biofuels is associated with biofuel cost estimation, the revenue earned, and the profit gained. This research evaluates the cost risk escalation and identifies the key cost factors associated with the economic viability of biofuels. To achieve this objective, this research presents an innovative methodology to perform probabilistic economic risk analysis of biofuel, and particularly biodiesel. Being stochastic in nature, the proposed methodology addresses the shortcomings of traditional biodiesel process economics and provides flexibility to deal with uncertainty in biodiesel process economics. The environmental aspects covered in this research are environmental impacts caused by all inputs to the biodiesel production process, including biomass feedstock, fresh or recycled materials and energy streams and outputs such as biodiesel, by-products and waste materials discharged into the soil and air. To address the influences of potential risks on biodiesel production and its environmental impacts, this thesis presents a new approach to perform probabilistic economic modelling, qualitative and quantitative risk assessment of biodiesel key performance indicators (KPIs) and life cycle assessment (LCA) of biodiesel fuel. Interpretive structural modelling (ISM) is used to model causation behaviour of the biodiesel process, operations and design risk factors. The basic premise of ISM is that qualitative interdependent relationships among various risk factors are achieved through experts’ opinions and a scientific approach. This thesis develops an objective risk analysis approach to integrate ISM and uses a Bayesian network (BN) to define the relationship and the strength of relationship among various cost related risk factors and studies their impact on biodiesel process economics. Addressing global environmental issues and considering the vital need of edible oil for food, this thesis also presents the LCA of biodiesel being produced from inedible oils and waste cooking oil (WCO) and performs the investigation using a systematic approach of life cycle thinking. The negative environmental consequences of biodiesel fuels on climate change (global warming), ecosystem quality and human health are explored in detail. The study also identifies the total environmental impacts of using these biomass feedstocks. A comparative LCA study of technological processes identifies which biodiesel production process has the most and the fewest ecological impacts and energy requirements. Finally, this research develops advanced methods for biodiesel process economics such as process value at risk (VaR), to be used in assessing the performance of biodiesel systems. The stochastic modelling process and interdependence of a BN format help to investigate the most significant risk factors in the biodiesel process and operations. The results facilitate the decision-making process for new product development (NPD) and process development, especially at a large industrial scale. Applications of the proposed economic risk assessment framework along with an LCA study help to develop effective biodiesel policy-making by describing scientific uncertainties related to process economics and the environmental impact of biodiesel production technologies. In another arena of application, this thesis helps to develop a strategic decision-making process for supply chain management of biomass feedstock as well as biodiesel. It also enhances the biodiesel process-based risk informed decision-making process by incorporating techno-economic and life cycle accounting decisions.

Item Type: Thesis (Doctoral (PhD))
URI: http://research.library.mun.ca/id/eprint/12872
Item ID: 12872
Additional Information: Includes bibliographical references.
Keywords: Economics, Risk analysis, Biodiesel, Life Cycle Assessment, Policy-making, Life Cycle Thinking, Interpretive Structural Modelling, Biodiesel Production, Value at Risk, Energy, Sustainability, Biodiesel Process Economics, Economic risk analysis, Uncertainty Analysis, Simulation, Environment
Department(s): Engineering and Applied Science, Faculty of
Date: October 2017
Date Type: Submission
Library of Congress Subject Heading: Biodiesel fuels -- Economic aspects; Biodiesel fuels -- Environmental aspects

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