(761d) Estimated Economic Impacts of Biofuel Production - a Comparative Analysis of Three Cellulosic Biofuel Pathways

The development of a cellulosic biofuel industry utilizing domestic biomass resources is expected to create opportunities for economic growth resulting from the construction and operation of new biorefineries. We applied an economic input-output model to estimate potential economic impacts, particularly gross job growth, for three different biofuel conversion pathways: 1) cellulosic ethanol via biochemical conversion in Iowa, 2) renewable diesel blendstock via biological conversion in Georgia, and 3) renewable diesel and gasoline blendstock via fast pyrolysis in Mississippi. 

Combining direct, indirect (revenue- and supply chain-related), and induced effects, capital investment associated with the construction of a biorefinery processing 2,000 dry metric tons of biomass per day (DMT/day) could yield between 5,960 and 8,470 full-time equivalent (FTE)  jobs during the construction period. Fast pyrolysis biorefineries produce the most jobs on a project level thanks to the highest capital requirement among the three pathways. Normalized on the scale of one million dollars of capital investment, the renewable diesel and fast pyrolysis biorefineries are estimated to yield the same number of jobs, i.e., 11.8 jobs. This level is slightly higher than cellulosic ethanol biorefinery, which results in 11.5 jobs per million dollar capital investment.

While operating biorefineries is not labor-intensive, the annual operation of a 2,000 DMT/day biorefinery could support between 720 and 970 jobs when the direct, indirect, and induced effects are considered. The major factor, which results in the variations among the three pathways, is the type of biomass feedstock used for biofuels. Unlike construction jobs, these operation-related jobs are necessary over the entire life of the biorefineries.  Our results show that indirect effects stimulated by the operation of biorefineries are the primary contributor to job growth. The agriculture/forest, services, and trade industries are the primary sectors that will benefit from the ongoing operation of biorefineries.