The impact of the biogas industry on agricultural sector in Germany

https://doi.org/10.17221/292/2015-AGRICECONCitation:Lajdova Z., Lajda J., Bielik P. (2016): The impact of the biogas industry on agricultural sector in Germany. Agric. Econ. – Czech, 62: 1-8.
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The whole concept of the biogas industry is an ongoing issue particularly because of its differences from the original purpose and the criticism about causing too many externalities. Its high costs and low efficiency compared to the traditional cheaper sources belong to the main problems. This issue is serious especially currently – at the times of a slow economic growth when a switch to renewable energy sources means yet another harm to the competitiveness of the EU producers as it increases their production costs. Another weak point is that the silage maize as the most common input material for the anaerobic digestion leads to the displacement of the food crops production and it is considered to be also a contributor to the food price increase. Biogas plants also compete for input with the livestock production that ends up in the biogas plants instead of e.g. feeding cows. The aim of the paper is to investigate the long-run relationship between the biogas industry and the agricultural sector in Germany – a leader in the technology with the most developed biogas sector among the European Union member states. The econometric analysis based on the Vector Correction Model confirms the stated assumptions and concludes that the production of biogas via the anaerobic digestion has a significant impact on agriculture in Germany.
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