[Terrapreta] Economics of biochar

[Rick Davies]

hi Tom

Who receives the benefits - a good question Could it not be a bit simpler
that your explanation in the first para below?
- the original producer of the biochar could sell the carbon offsets to
intermediaries like Climate Care, and the physical biochar to actual users,
like farmers (perhaps). The actual users of the may benefit by getting
access to biochar at cheaper prices, because its production could be cross
subsidised by the charcoal producer's income from carbon offsets.

I dont think selling the offsets down the supply chain along with the actual
biochar would be a good idea, because when the holder of the offsets wants
to sell them they would have more difficulty verifying details of how it was
originally generated.

But in the case of past research on biochar, these offset rights may have
effectively been passed on, rather than sold by the original producer of the
biochar.

Your estimate of the value of a CO2  credit for biochar at $100/ton is
interesting. It represents a significant fraction of the biochar production
cost quoted for Best Energies in a earlier posting today by Michael

regards, rick, late at night, need to sign off now...

regards, rick

On Dec 30, 2007 10:57 PM, Tom Miles <tmiles at trmiles.com> wrote:

>  Rick,
>
>
>
> Who receives the benefit? The biochar consumer (farmer) would receive the
> CO2 benefit. He sells those benefits to a third party, like Climate Care,
>  who sells it to you and provides verification that the carbon has been
> applied to the soil.  With the current price of CO2 at $30/ton (EUR 22.30/tonne
> http://www.pointcarbon.com ) and 1 ton of C equal to 3.6 ton CO2 then the
> credit is worth about $100/ton of biochar. The farmer would receive a
> portion of that (carbon less transaction cost). In the US CO2 is worth only
> about $1.95/ton which at 3.6 ton CO2/ton C is about $7/ton biochar.  That
> benefit would be applied to his cost of buying the biochar and putting it
> into the ground.
>
>
>
> As far as I know nobody knows what value to assign to agronomic benefits
> from the use of biochar such as increased yield, reduced crop loss, or
> reduced input (water, fertilizer) costs.
>
>
>
> The biochar producer receives no carbon benefits from the sale of biochar.
> If he converts the waste gas (CO, H, etc) to energy then he could sell CO2
> credits to the market to offset CO2 from fossil fuels. If he makes 1 ton of
> biochar from 4 tons of biomass then he probably releases about 1 ton of
> carbon as CO2 (50% C x 4 tons = 2 tonsC-1 ton C as biochar). So for each ton
> of biochar he makes if he converts the waste gas to energy (kW) he could
> sell ( 1tC x 3.6 tCO2/tC) 3.6 tons of CO2 x $1.95 or about $7/ton of
> biochar.
>
>
>
> Tom
>
>
>
> 2. Left out of your calculations, I think, is the interesting and perhaps
> unique feature of biochar, which is that you can sell the same kg of
> charcoal twice! Once as a carbon offset, to people like me, then secondly as
> a soil improver to others (and adding to compost would be a verifiable means
> of putting charcoal beyond use, as a fuel).
>
> Could you re-do your calculations taking into account both sources of
> income that producers of charcoal as biochar could receive? My hope is that
> it might help make charcoal sold as biochar a more attractive business
> proposition than selling charcoal as a fuel
>
> regards, rick davies
>



-- 
Rick Davies (Dr),
Monitoring and Evaluation Consultant, Cambridge, United Kingdom.
Mobile:  (44) 07855 766 354, Skype: rickjdavies,
Email: rick.davies at gmail.com
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