The cost of biethanol per litre presented here mainly calculated from the cost of raw materials used; i. e. lignocellulosic biomass and sulfuric acid and processing cost. Fixed operating costs are excluded from this calculation. Fixed operating costs including labour and various overhead items are fully incurred regardless of the operating production capacity and their contribution to the total cost of bioethanol is estimated at 15 to 18%. [37] stated that cost of biomass contribute almost 60% to the total production cost which is the highest contributor to the cost of bioethanol. Therefore, the main focus here is to estimate the effect of raw materials price on the cost of bioethanol.

1.1.3. Cost of lignocellulosic biomass

Assessing the various costs of mobilising lignocellulosic biomass today which include harvesting, collection, pre-processing, substitution and transportation to a downstream hub, the order of biomass can be mobilised at globally competitive costs, i. e., at a cost of less than RM 250 per dry-weight tonne. The distance of transportation should be less than 100km in radius from the collection area.

1.1.4. Cost of sulfuric acid and recovery charge

The sulfuric acid is sells at RM 264 per tonne. By far, sulfuric acid is the largest expenditure of raw materials in the process of making bioethanol from lignocellulosic biomass. Nonetheless, the current technology enable the acid-sugar solution from hydrolysis separated into acid and sugar components by means of chromatographic separation using commercial available ion exchange resins to separate the components without diluting the sugar. The separated sulfuric acid is recirculated and reconcentrated to the level required by the decrystallization and hydrolysis steps. Using this technology almost up to 100% of the sulfuric acid can be recovered from the process.