The financial trade‐off between the production of biochar and biofuel via pyrolysis under uncertainty

There is a lack of widespread interest in slow pyrolysis biochar pathways relative to other bioenergy pathways because of the perceived absence of biochar's market value when produced at a commercial scale. Thus, most refereed techno‐economic analyses focus on fast pyrolysis. This study quantifies the carbon price point at which the economic feasibility of the slow‐pyrolysis pathway for biochar production is equal to or greater than a fast‐pyrolysis pathway for biochar and biofuel production using baseline minimum carbon prices (MCP). These factors are then modeled under uncertainty to generate stochastic cash flows for the calculation of a 20‐year net present value and carbon abatement cost probability distributions. This article examines whether a slow‐pyrolysis pathway is ever more financially attractive than a fast‐pyrolysis pathway at realistic carbon prices. The results show fast pyrolysis to fuels and biochar achieving the lowest baseline MCP of $61.38/Mg, while the slow pyrolysis to biochar and methanol at 450 °C scenario yields the highest baseline MCP of $642.40/Mg. A notable result is the baseline MCP for the slow pyrolysis to biochar scenario achieving $123.48/Mg, when compared with the fast pyrolysis to fuels and electricity scenario, resulting in a baseline MCP of $182.03/Mg. The results suggest that carbon prices, when high enough, can incentivize biochar carbon sequestration produced from slow‐pyrolysis pathways rather than carbon abatement with biofuels, and that slow pyrolysis to biochar and methanol scenarios require a higher baseline MCP and are less financially competitive than the other pathways.