Sustainability analysis of bioethanol promotion in Thailand using a cost-benefit approach

Abstract

This study aims at analyzing the sustainability of bioethanol promotion in Thailand using cost-benefit analysis. The analysis is carried out based on the bioethanol production targets in Thailand’s Alternative Energy Development Plan 2015, covering cassava and molasses ethanol. The role of taxes and production efficiency improvement on the entire economy is presented via bioethanol promotion options. The socio-economic and environmental effects of bioethanol promotion are also considered. The effects of bioethanol promotion are derived via a hybrid approach including computable general equilibrium modeling and life cycle impact assessment. Environmental effects are converted into monetary units using the conversion factors for Thailand. The results show that increasing bioethanol production and use can bring about a net benefit to society of around 62 billion Thai Baht over 2016–2026. Improving the production efficiency of feedstock along with increasing bioethanol production can increase the net benefit to society. Furthermore, not only does bioethanol promotion enhance real Gross Domestic Product, but also creates more jobs in the society and leads to less environmental cost per unit of domestic production when air emissions and irrigation water consumption are considered. The study can thus support decision-making towards sustainable biofuel development in Thailand.