Investment Risk Analysis of Electricity Generation from Vinasse Biodigestion in the Free Contracting Environment

• Published in: 2018 IEEE International Conference on Environment and Electrical Engineering and 2018 IEEE Industrial and Commercial Power Systems Europe (EEEIC / I&CPS Europe) pp. 1 - 6
• Main Authors: Schiochet Pinto, Luane, Pinheiro Neto, Daywes, Geraldo Domingues, Elder
• Format: Conference Proceeding
• Language: English
• Published: IEEE 01.06.2018
• Subjects: biogas; Biological system modeling; Economics; electricity generation; Ethanol; Finance; free contracting environment; Power systems; Production; Random variables; risk analysis; vinasse
• DOI: 10.1109/EEEIC.2018.8494604

This paper presents a methodology for investment risk analysis of the electricity generation from the biogas energy utilization from the biodigestion of vinasse produced in sugarcane agroindustries. The methodology uses econometric models, together with the Monte Carlo method for the generation of synthetic series of random variables: i) ethanol production, which will be used to estimate vinasse generated in the process and ii) Price Settlement of Differences. The economic viability analysis is based on the evaluation of the probability distribution of the Net Present Value (NPV), the Modified Internal Rate of Return (MIRR and the Discounted Payback, considering the commercialization of electric power in the Free Contracting Environment. The case study is carried out for a sugarcane plant located in the Midwest area of Brazil. The preliminary results point to the economic feasibility of implementing the project, bringing important information to assist the investor in the decision-making process.