Biofuel Price Volatility For Electricity Generation: A Systematic Review with Comparative Insights

Abstract

As global demand and supply of biofuels continue to grow, understanding price uncertainty in biofuel-based investments and operations has become increasingly important. This systematic literature review examines how uncertainty, risk, and volatility in biofuel prices have been addressed in academic studies between 2010 and 2025. The review aims to shed light on how different aspects of price uncertainty have been studied, with a particular focus on comparing the role of biofuels in electricity generation versus their direct use in transportation. The analysis identifies three overarching themes in the literature: studies on investments, price competitiveness, and methods to manage uncertainty. The findings reveal notable gaps, including limited research on biofuel price uncertainty in electricity generation, as well as insufficient comparative analysis between energy and transport applications. Furthermore, there appears to be a bias toward quantitative methods and supply chain optimization. The review highlights the need for more diverse research approaches and a broader geographic scope to better capture biofuel price uncertainty. This comprehensive analysis offers valuable insights for stakeholders evaluating the relative efficiency and economic implications of deploying biofuels in power production or vehicle use under future price uncertainties.