An alternative methodology for analyzing the risk and sensitivity of the economic viability for generating electrical energy with biogas from the anaerobic bio-digestion of vinasse

• Published in: Renewable energy Vol. 155; pp. 1401 - 1410
• Main Authors: Schiochet Pinto, Luane, Pinheiro Neto, Daywes, de Leles Ferreira Filho, Anésio, Domingues, Elder Geraldo
• Format: Journal Article
• Language: English
• Published: Elsevier Ltd 01.08.2020
• Subjects: Biogas; Electrical energy; Risk analysis; Sensitivity analysis; Electrical energy; Biogas; Sensitivity analysis; Risk analysis
• ISSN: 0960-1481; 1879-0682
• DOI: 10.1016/j.renene.2020.04.036

The process of generating electrical energy using biomass adds value to previously discarded waste, enables the commercialization of surplus electricity, reduces greenhouse gas emissions, and promotes rural development. Despite these technical advantages, the technology cost used in this process requires an evaluation of the economic viability. Therefore, this article presents a methodology that aims to identify the economic viability of investments projects for the generation of electrical energy through biogas from the anaerobic bio-digestion of vinasse, and the most sensitive parameters that affect it. Such methodology is substantiated on the execution of i) the investment risk analysis of this project type, and ii) the univariate sensitivity analysis of some strategically selected variables. The results of its application, using data from a sugar-energy plant located in Brazil, indicate that the plant can produce 554,000 m³ of biogas and 1.3 MWh/month of electricity. This amount can be traded in the Free Contracting Environment and in the Regulated Contracting Environment. A risk analysis employing the Net Present Value indicator shows that the probability of the project being viable in both environments is 78.55% and 87.50%, respectively. This methodology is an important tool which is capable of boosting the productivity of this business category. •Investment risk analysis of electricity production from vinasse biodigestion. .•Case study conducted on a sugarcane plant located in Brazil.•Risk indicators are provided to assist investors in their decision-making processes.•Economic viability study for different electricity trading environments.•Sensitivity analysis using key parameters that could affect project viability.