Investment in Cellulosic Biofuel Refineries: Do Renewable Identification Numbers Matter?
| dc.creator | Miao, Ruiqing | |
| dc.creator | Hennessy, David A. | |
| dc.creator | Babcock, Bruce A. | |
| dc.date | 2017-04-01T20:00:06Z | |
| dc.date.accessioned | 2026-07-09T05:19:45Z | |
| dc.description | A floor and trade policy in Renewable Identification Numbers (RINs) is the market mechanism by which U.S. biofuel consumption mandates are met. A conceptual model is developed to study the impact of RINs on stimulating investment in cellulosic biofuel refineries. In a two-period framework, we compare the first-period investment level (FIL) in three scenarios: (1) laissez-faire, (2) RINs under a nonwaivable mandate (NWM) policy, and (3) RINs under a waivable mandate (WM) policy. Results show that when firm-level marginal costs are constants, then RINs under WM policy do not stimulate FIL but they do increase the expected profit of more efficient investors. When firm-level marginal costs are not constants, however, RINs under WM policy stimulate FIL. RINs under NWM policy may or may not stimulate FIL, depending on the distribution of second-period cellulosic biofuel prices and on firm-level marginal costs. | |
| dc.identifier | doi:10.22004/ag.econ.94001 | |
| dc.identifier | https://ageconsearch.umn.edu/record/94001/files/10-WP_514.pdf | |
| dc.identifier | http://ageconsearch.umn.edu/record/94001 | |
| dc.identifier.uri | http://hdl.handle.net/123456789/562188 | |
| dc.language | eng | |
| dc.publisher | ||
| dc.source | http://ageconsearch.umn.edu/record/94001 | |
| dc.title | Investment in Cellulosic Biofuel Refineries: Do Renewable Identification Numbers Matter? | |
| dc.type | Text |