Biomass and multi-product crops for agricultural and energy production - an AGE analysis

By-products from agriculture and forestry can contribute to production of clean and cheap (bio)electricity. To assess the role of such multi-product crops in the response to climate policies, we present an applied general equilibrium model with special attention to biomass and multi-product crops. The potential to boost production of bioelectricity in Poland through the use of multi-product crops turns out to be limited to only 2¿3% of total electricity production. Further expansion of the bioelectricity sector will have to be based on biomass crops explicitly grown for energy purposes. The competition between agriculture and biomass for scarce land remains limited. In the scenarios, production of agricultural goods decreases at most with 5%, and the largest price increase for agricultural goods amounts to 5%. These changes in production induce substantial changes in land allocation: around 250,000 ha is converted from agricultural production to forestry and willow plantations