Supply chain system for a centralized biorefinery system based on switchgrass grown on marginal land in Michigan.

The feedstock supply chain of a biorefinery is critical in determining the economic and environmental performance of biofuels. This study investigated various feedstock supply chains for a centralized biorefinery based on different objective functions and how the biorefinery responds to supply chain volatility. For the analysis, a hypothetical centralized biorefinery was supplied by switchgrass grown on marginal lands in Michigan. From an economic standpoint, the minimum biofuel selling price is an important metric of the objective function, and the greenhouse gas mitigation potential is a similarly important metric for global warming impact. A trade‐off therefore exists between the economic and environmental performance of biofuels under this system configuration. However, when a carbon tax credit is applied to soil organic carbon sequestration in switchgrass production, the metric of the objective function may not be the key factor in establishing a supply chain as long as it is associated with biorefinery capacity as well as economic or environmental values. Year‐to‐year fluctuations in cellulosic biomass yield (supply chain volatility) might also prevent the biorefinery from operating at full capacity. Cellulosic biomass pellets can serve as an auxiliary feedstock for the centralized cellulosic biorefinery system to minimize the impacts of supply chain volatility. [ABSTRACT FROM AUTHOR]