Impact of Air Pollution Control Costs on the Cost and Spatial Arrangement of Cellulosic Biofuel Production in the U.S.

Air pollution emissions regulation can affect the location, size, and technology choice of potential biofuel production facilities. Difficulty in obtaining air pollutant emission permits and the cost of air pollution control devices have been cited by some fuel producers as barriers to development. This paper expands on the Geospatial Bioenergy Systems Model (GBSM) to evaluate the effect of air pollution control costs on the availability, cost, and distribution of U.S. biofuel production by subjecting potential facility locations within U.S. Clean Air Act nonattainment areas, which exceed thresholds for healthy air quality, to additional costs. This paper compares three scenarios: one with air quality costs included, one without air quality costs, and one in which conversion facilities were prohibited in Clean Air Act nonattainment areas. While air quality regulation may substantially affect local decisions regarding siting or technology choices, their effect on the system as a whole is small. Most biofuel facilities are expected to be sited near to feedstock supplies, which are seldom in nonattainment areas. The average cost per unit of produced energy is less than 1% higher in the scenarios with air quality compliance costs than in scenarios without such costs. When facility construction is prohibited in nonattainment areas, the costs increase by slightly over 1%, due to increases in the distance feedstock is transported to facilities in attainment areas. [ABSTRACT FROM AUTHOR]