The national bioenergy investment model

Technical documentation

Center for International Forestry Research (CIFOR)Bogor, Indonesia

The National Bioenergy Investment Model is a scenario model that simulates the decisions of domestic and international investors on whether to invest in biofuel enterprises in a developing country. In the model, investors compare the profitability of different biofuel feedstock and fuel operations using a riskadjusted discount rate – taking market, currency, country and sector risks into account. Prices for biofuels and feedstocks are determined in part through exogenous international prices and in part through a dynamic, equilibrium-seeking price adjustment mechanism. The model is intended to be used within a participatory scenario exercise, and can be run interactively.