Abstract
In an environmental economic analysis of the largest biogas plant in Japan, a number of matters were clarified through the quantitative assessment of the plant′s investment effects and environmental functions. Income earned from waste processing remains as important as revenue from electricity sales even after the introduction of a feed-in tariff (FIT) scheme significantly boosted the latter. This confirms that the plant successfully performs the two functions of treating organic waste and utilizing renewable energy. However, the initial investment has not been fully recouped even though electricity is purchased under the FIT scheme. One reason for this is insufficient income from the heat generated, and another is that the public welfare functions of the environmental measures have not been assessed economically. In terms of contribution to the local economy, attention should be paid not only to jobs at the plant but also to the facility′s role as a basis for the survival of agriculture and other local industries. Considering these points, support for the biogas plant via the FIT scheme and agricultural subsidies can be seen as economically useful and necessary.
