The Impact of Different Energy Policy Options on Feedstock Price and Land Demand for Maize Silage: The Case of Biogas in Lombardy
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The growing demand of green maize for biogas production in Northern Italy has
triggered an intense debate concerning land rents, maize prices and their possible
negative consequences on important agri-food chains. The aim of this work is to
quantify the extent to which the rapid spread of biogas raised the maize price at
regional level, increasing the demand of land for energy crops. For this purpose we
built a partial-equilibrium model simulating the agricultural sector and the biogas
industry in Lombardy, under two alternative subsidization schemes. Results show that
policy measures implemented in 2013 – reducing the average subsidy per kWh – may
contribute to enforce the sustainability of the sector and decreasing its competition
with agri-food chains: maize demand for biogas would decrease, compared to the old
scheme, lessening the market clearing price and reducing land demand for energy
purposes.