Mississippi private landowner willingness for diverting land to growing short rotation woody crops for bioenergy enterprises

Abstract

The financial viability of bioenergy enterprises is critically dependent on the smooth supply of woody biomass. It is, thus, important to determine whether there will be sufficient woody biomass available to support these enterprises. This study quantified Mississippi's private landowner willingness to accept (WTA) per acre per year to lease their lands to bioenergy firms for growing short rotation crops (SRWCs). Data were generated based on a dichotomous choice contingent valuation experiment of a random sample of non-corporate agricultural and forest landowners in 2011. Results based on Turnbull (a nonparametric procedure) showed the lower bound estimate of mean WTA to be US$76 per acre per year whereas the econometrically derived mean and median WTA estimates evaluated at the mean of explanatory variables were, respectively, US$85 and U$65. Significant differences in WTA per acre per year were found across groups of landowners differentiated by reason(s) for owning land. These findings suggest that it would not be efficient for bioenergy firms to offer a uniform compensation per acre to induce landowners to lease their lands.