Economic Sustainability of Bioenergy Production/Use

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1 Economic Sustainability of Bioenergy Production/Use Sustainable Bioenergy Production and Use in Southeast Asia November 2017 Hanoi Viet nam Nuengruethai Srithornrath The Department of Agriculture Thailand

2 The Kingdom of Thailand Geography: Lies in the heart of Southeast Asia Latitude 5 37 north north Longtitude East East Neighboring countries: Myanmar (west and north) Laos PDR (north / northeast) Cambodia (southeast) Malaysia (south)

3 Land Utilization Agriculture 47 % Forest 32 % Others 21 % Source: Office of Agricultural Economics 2016

4 Agricultural Land Utilization (%) Others 8% Vegetable 1% Field Crops 21% Rice 47% Horticulture 23% Source: Office of Agricultural Economics 2016

5 Production area under Rainfed & Irrigation(%) Irrigation 20% rainfed 80% Source: Office of Agricultural Economics 2016

6 Policy of the Minister Reducing Costs

7 R&D on 11 Crops 1. Sugarcane 2. Cassava 3. Oil palm 4. Corn 5. Soybean 6. Mungbean 7. Peanut 8. Sunflower 9. Sesame 10. Sorghum 11. Cotton

8 Sugarcane Planted Area 1.5 mil ha Production 106 mil tons Average Yield 69 tons / ha Farm Value 2,824 mil $US Khon Kaen 3, 80 U-Thong 3, 5, 8, 9, 84-10, 84-11,84-12,84-13 Suphan Buri 50 (juice cane) Source: Office of Agricultural Economics 2016

9 Cassava Planted Area 1.5 mil ha Production 32 mil tons Average Yield 22 tons / ha Farm Value 2,245 mil $US Rayong 5, 7, 9, 11, 72, 90,84-13 Source: Office of Agricultural Economics 2016

10 Oil palm Planted Area 739,360 ha Harvested Area 643,840 ha Production (FFB) 13 mil.tons Average Yield 19 tons/ha Farm Value 1,664 mil.$us Surat Thani 1 to 8 Source: Office of Agricultural Economics 2016

11

12 Sugarcane Khon Kaen 3 Variety Source: Office of Agricultural Economics 2016

13 Importance Sugarcane and sugar production in Thailand is highly successful at the global and ASEAN levels the farmers received 2 benefit : sweetness is higher and increased productivity Sugar Industry has gained a higher sugar per ton of sugarcane, higher sale price of cane stems and higher amount of bagasse 4 The farmers gained higher marginal profit from the sale of sugarcane setts

14 sugarcane Sugar Factory Sugarcane Utilization Ethanol 1 ton of sugarcane = 70 liter ethanol 1 ton sugarcane = kg sugar Sugar Molasses Bagasse Filter cake 1 ton sugarcane = kg molasses 1 ton sugarcane = kg bagasse ethanol 1 ton molasses = 260 liter ethanol alcohols Seasoning powder other electric kg bagasse = 100 kw electric power Paper animal feed Compose other Bio fertilizer other

15 Khon kaen 3 Sugarcane Utilization (1 hectare) sugarcane 100 ton sugarcane Sugar Factory Ethanol 7,000 liter Sugar Molasses Bagasse Filter cake 10 ton sugar 4.5 ton molasses 28 ton bagasse 60% Adoption Area in Thailand ethanol 1,170 liter ethanol alcohols Seasoning powder other electric 10,000 kw electric power Paper animal feed Compose other Bio fertilizer other

16 Research project 16 cost Climate change,drought, low yield Plant breeding research project New Varieties researchers cost Extension (DOA Seed production and Seed village) Adoption researchers Benefit analysis by Economic surplus Impact Recommendation for policy Recommendation for R&D

17 Benefit of Khon Kaen 3 17 Benefits - Farmer s Income - Benefit of the Sugar Factories - Benefit of The DOA - Benefit of the Researchers Costs - Research project (12 years) - Extension Total cost = 1,618, $ Source : Impact Assessment of Sugarcane and Sugar Researches in Thailand, 2016

18 Benefit of Khon Kaen 3 18 Khon Kaen 3 (R&D) Ex-Post Evaluation ( ) NPV (USD) BCR IRR(%) ,993, ,378, NPV = Net Present Value (the difference between the present value of cash inflows and the present value of cash outflows) BCR = A benefit-cost ratio (an indicator, used in cost-benefit analysis, that attempts to summarize the overall value for money of a project or proposal) IRR = Internal rate of return (a metric used in capital budgeting measuring the profitability of potential investments) Source : Impact Assessment of Sugarcane and Sugar Researches in Thailand, 2016

19 Conclude 19 Output : KK 3 Outcome Benefit of Farmer,Sugarcane Factories, Doa and Researchers Impact : NPV = 532,378, $ Source : Impact Assessment of Sugarcane and Sugar Researches in Thailand, 2016

20 Conclude Benefit USD/Year Year Cost R & D Time Adoption time

21 Thank you