Biofuel market and carbon modeling to evaluate French biofuel policy

Frédérick Bernard (1) , Anne Prieur (1)

1 IFPEN - IFP Energies nouvelles

In order to comply with European objectives, France has set up an ambitious biofuel plan. This plan is evaluated considering two criteria: tax exemption need and GHG emission savings. An economic marginal analysis and a life cycle assessment (LCA) are provided using a coupling procedure between a partial agro-industrial equilibrium model and a refining optimization model. Thus, we are able to determine the minimum tax exemption needed to place on the market a targeted quantity of biofuel by deducing the agro-industrial marginal cost of biofuel production to the biofuel refining long-run marginal revenue. In parallel, a biofuels LCA is carried out using model outputs. Such a method avoid common allocation problems between joint products. The French biofuel plan is evaluated for 2008, 2010 and 2012 using prospective scenarios. Results suggest that biofuel competitiveness depends on crude oil prices and petroleum products demands. Consequently, biofuel tax exemption does not always appear to be necessary. LCA results show that biofuels production and use, from «seed to wheel», would facilitate the French Government’s to compliance with its «Plan Climat» objectives by reducing up to 5% GHG emissions in the French road transport sector by 2010.

Domains: Humanities and Social Sciences; Economics and Finance

Frédérick Bernard, Anne Prieur. Biofuel market and carbon modeling to evaluate French biofuel policy: Cahiers de l'Economie, Série Recherche, n° 63. 2006. ⟨hal-02469003⟩