National and regional economic impacts of electricity production from energy crops in the Netherlands

Abstract

Besides the known environmental benefits, national and regional economic impacts may form additional arguments for stimulating government measures in favour of electricity production from energy crops in the Netherlands. Therefore, we compared the economic impacts (at both national and regional level) of heat and power generation from energy crops (willow) and from imported natural gas in the Netherlands. Both conversion systems used combined cycle technology (30 MW electric and 30 MW thermal capacity). Input-Output Analysis was used to calculate indirect impacts. It is concluded that, for the case under consideration, generating electricity from willow, compared to using natural gas, gives a higher contribution to the Gross Domestic Product (both nationally and regionally) and creates more employment if willow is produced at obligatory set-aside agricultural areas (in the chosen region in the Netherlands). However, when grain production is substituted by willow, the renewable system results in smaller effects on the economy than the fossil alternative.