Evaluating the economic feasibility of cellulosic ethanol: A meta-analysis of techno-economic analysis studies

The conversion of cellulosic biomass to ethanol as a viable way of decarbonizing the transportation sector has experienced a growing interest in the last few decades. However, this infant industry still struggles to succeed commercially. To examine the economic feasibility of cellulosic ethanol, this study conducts a meta-analysis using recently published Techno-Economic Analysis (TEA) studies, which compute the Minimum Fuel Selling Price (MFSP) to measure the economic viability of ethanol production. This review finds that ethanol MFSPs range from $0.90-6.00/gallon with an average of $2.65/gallon, which is comparable to retail gasoline prices in the U.S. The considerable variation in MFSP estimates is due to the wide range of assumptions made by TEA studies. The unit cost of production was computed to examine the economies of scale effect, which resulted in a scale factor of 0.69. This estimate affirms the assumptions made by TEA studies. Multivariate linear regression shows that capital cost is positively correlated, while input capacity and output capacity are negatively correlated, with MFSP. These variables significantly impact MFSP, while pathway, feedstock type, and feedstock cost are not statistically significant due partly to data limitations. Findings from this analysis provide insights for improving the economic viability of cellulosic ethanol, which calls for a suite of government policies including financial incentives, mandates, and assistance programs for this industry to thrive.