Economic evaluation of thermochemical conversion for rice straw-based second-generation bioethanol production in West Java

Abstract

Abstract Production of bioethanol through several routes from cheap materials such as agricultural solid waste is getting more interesting nowadays. Rice straw is one of the potential agricultural solid wastes that can be used as feedstock for bioethanol production due to a huge amount of availability, especially in South East Asia countries. In this study, the economics of rice straw-based bioethanol plant by thermochemical conversion was evaluated. The main processes involved in the plant are pretreatment, gasification, water-gas shift reaction, carbon dioxide removal, alcohol synthesis, and purification. The plant was planned to be located in Indramayu, West Java, Indonesia. The price of bioethanol set on this evaluation is US$ 0.61 per liter. The total capital expenditure (CAPEX) and operational expenditure (OPEX) of this plant were found to be US$ 122,614,000 and US$ 20,175,910, respectively. The return on investment (ROI) is 66.96%. The internal rate of return (IRR) is 24.08%. The net present value (NPV) is US$ 689,074,000. Finally, the payback period is 4.5 years. The result of this study shows that this bioethanol plant is feasible and very profitable to be implemented.