Cost-benefit analysis for recycling of agricultural wastes in Taiwan

Abstract

Agricultural waste can be recycled in different ways. Cost-effectiveness is important information for investment decision-making of enterprises and policy-making of government to choose a profitable way to recycle agricultural waste. Therefore, this paper aims to present a cost-benefit analysis to assess and compare the cost-effectiveness between feasible recycling methods, and further propose cost-effective ways for recycling agricultural waste in Taiwan. Three recycling types of agricultural wastes, namely, composting, biogas power generation and biomass fuel are selected for cost-benefit analysis based on related regulations and policy supports of agricultural waste management in Taiwan. Primary data collected by sampling surveys conducted in 2018 supplemented by secondary data from national statistics are used for this study. Study results show that all three recycling types of agricultural wastes discussed in this study are profitable under corresponding economic conditions in 2018 with benefit/cost ratio greater than 1 and positive net present value; as expected, the cost-effectiveness of agricultural waste recycling varies depending on the recycling types, composition of input materials, and economic scales. Mixing chicken manure with other agricultural wastes for composting and using rice straw to make biomass fuel rods are estimated to have higher cost-effectiveness; livestock farms with small farming scale have relatively low biogas energy recovery efficiency; the cost-effectiveness of biogas power generation highly depends on fixed-in tariffs (FITs). Results imply that policy support for establishing co-processing centers of agricultural waste and differentiated FITs would be good measures to stimulate recycling efficiency of agricultural waste in Taiwan.