报告题目：Economic and Environmental Implications of Biomass Commercialization in Agricultural Processing
报 告 人：Bin LI（Singapore Management University, Ph.D. Candidate）
主 持 人：王杉（中山大学岭南学院 助理教授）
This paper examines the economic and environmental implications of biomass commercialization, i.e., converting organic waste into a saleable product, from the perspective of an agricultural processing firm that uses a commodity input to produce both a commodity output and biomass. We characterize the economic value of biomass commercialization and perform sensitivity analysis to investigate how spot price uncertainty affects this value. To examine the environmental implications, we characterize the expected carbon emissions resulting from commercialization. In contrast to the general perception in industry, which fails to consider the changes in processor’s operational decisions after commercialization, we find that biomass commercialization may be harmful to the environment, specifically when the biomass selling emission intensity is moderate and the biomass demand is high. We perform sensitivity analysis to investigate how higher biomass market price or demand (which always increases profitability) affect the expected emissions. We find that higher biomass market price or demand decreases the expected emissions---that is, economic and environmental objectives are aligned---only when the biomass selling emission intensity is low. Using a calibration based on a palm oil mill selling biomass (palm kernel shell) to a boiler in Japan, we numerically quantify the economic and environmental implications of biomass commercialization.
My broad research interests lie in the area of agricultural operations management, interface of OM and finance, and sustainable operations. My current research, operational decision making in commoditized industries with a special focus on agribusiness, primarily focuses on the integration of input risk management (through sourcing decisions) with output risk management (through processing and output spot trading decisions) in agricultural industries, and studies important operational problems for the commodity processors in this setting.