Integrating life-cycle assessment and choice analysis for alternative fuel valuation

- Corn starch ethanol fuels offer no benefit in environmental or health outcomes over gas.
- Policies encouraging corn ethanol blends are likely inefficient.
- Cellulosic ethanol blends appear to offer potential improvements over gasoline.
- Integrated LCIA and valuation techniques can lead to more comprehensive fuel analysis.

This study monetizes the environmental damage and human health risk externalities associated with the life-cycle production and use of ethanol biofuels from corn-based and cellulosic feedstocks. An integrated economic-environmental assessment framework couples the measured emission impacts from the fuels with individuals' preferences regarding each fuel's externalities. This framework allows the welfare values associated with gasoline and ethanol's externalities to be derived and compared. The results of the study reveal that the production and consumption of corn starch ethanol produce declines in environmental and health outcomes of $1.23 per gallon relative to gasoline for an 85% blend. Depending on the feedstock source, cellulosic based ethanol blends produce modest gains in environmental and health outcomes valued at between $0.04 and $0.06 per gallon relative to gasoline.