Monetary value of the environmental and health externalities associated with production of ethanol from biomass feedstocks

This research is aimed at monetizing the life cycle environmental and health externalities associated with production of ethanol from corn, corn stover, switchgrass, and forest residue. The results of this study reveal current average external costs for the production of 1 l of ethanol ranged from $0.07 for forest residue to $0.57 for ethanol production from corn. Among the various feedstocks, the external costs of PM10, NOX, and PM2.5 are among the greatest contributors to these costs. The combustion of fossil fuels in upstream fertilizer and energy production processes is the primary source of these emissions and their costs, especially for corn ethanol. The combined costs of emissions associated with the production and use of nitrogen fertilizer also contribute substantially to the net external costs. For cellulosic ethanol production, the combustion of waste lignin to generate heat and power helps to keep the external costs lower than corn ethanol. Credits both for the biogenic carbon combustion and displacement of grid electricity by exporting excess electricity substantially negate many of the emissions and external costs. External costs associated with greenhouse gas emissions were not significant. However, adding estimates of indirect GHG emissions from land use changes would nearly double corn ethanol cost estimates.