Environmentally Friendly Fuel Usage: Economic Margin of Feasibility

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In the world there are two main problems concerning energy and ecology. Despite the crude oil price fluctuation, it has tended to increase. Moreover fossil fuel burning emits hazard compounds, including greenhouse gas. To solve them alternative fuels for vehicle have to be used. In due to properties, their usage impacts on the engine efficiency. The alternative fuel usage needs additional investment costs on the vehicle engines adaptation and fuel supply infrastructure. So, decisions must be based on mathematical apparatus. Three submodels were used in the suggested mathematical model: energy and economic indicator for fuels; energy and economic indicator for vehicles; criteria for investment projects. As a criterion of investment projects the profitability index has been grounded. The mathematical model and the algorithm for determining the feasibility of the alternative fuel utilization have been developed. The proposed algorithm includes the following stages: calculation of the fuel energy cost; calculation of the criteria for vehicles; determining the maximum value of investments; making decisions. Biofuels and gaseous fuels for some countries have been studied. The economic attractiveness of the alternative transport fuels has been presented. According to mathematical modeling, gaseous fuels are more economically attractive compared with liquid biofuels. Among gaseous fuels, LPG has a higher economic efficiency. The economic margin of alternative fuel application feasibility has been determined.

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