Climate benefit dominates discussions and decisions about renewable fuels today. A newly developed method values more benefits that can influence society’s choice of path.
Valuation of socio-economic benefits is a way of creating a basis for decisions where one needs to take into account more perspectives than the strictly business one when making investment decisions, strategic planning and policy measures.
What is a safer supply of fuel worth to society? And what values do circular production systems add? These two benefits have not been able to be valued in a good way so far, and thus risk being overshadowed by the climate-related benefits.
The value of a more secure supply of fuel
Security of supply, to counteract disruptions and interruptions in the supply of electricity, fuel, gas and heat, is an important function for society and one of the goals.
From time to time there are global disturbances in the inflow of oil-based fuels. These disturbances are estimated to cause billions in losses.
The production of renewable fuels can to some extent contribute to mitigating the effects of global fuel supply disruptions on the world economy, the study shows. It must be weighed against the fact that the production of domestic, renewable fuels is also affected by disturbances.
The biofuels HVO, ethanol and biogas have a circularity of over 65 percent, from raw material to tank. Electricity scores lower in terms of circularity, but this can be significantly improved by a higher degree of renewable energy in the electricity system and by increased reuse and recycling of batteries.
However, capturing the value of circularity proved difficult due to the vague, broad and complex nature of the concept of circular economy. In-depth methodological studies are needed here.
Also read: Electric cars have a significant part in climate work