We will explore how to value using modern financial techniques the development of new alternative energy technologies (AETs) given uncertainty. Uncertainty in developing AETs derives from: (1) the reduction in installation cost of new generation capacity as experience with the technology is gained, i.e. the learning curve (2) oil and natural gas price cycles; and (3) other macroeconomic and geopolitical forces, particularly the behavior of national oil companies (Aramco, PDVSA, PEMEX, etc.). Evaluating a new AET properly requires representing these uncertainties as well as an investment valuation approach that works well under high uncertainty. In particular, we propose to adapt the real options methodology to value the potential return from developing AETs using stochastic system dynamics models representing the uncertainty in both the learning curve and the fossil fuel price cycles.

This is the whole item.

Date created

• 2007 July 29-2007 August 2

Type

• Document

Processing Activity

• Processing documentation available at: https://wiki.albany.edu/display/SCA/Processing+Ingested+Digital+Files

License

• Creative Commons BY-NC-ND Attribution-NonCommercial-NoDerivs 4.0 International

  
  Contact Us for questions or additional rights.

ITEM CONTEXT

Part of

298eed5a7fe199ac661be72f3a39f134

Scope and Contents

Part of

0619e689ce89476bfd3b88323c5a9410

Scope and Contents

Part of

23d738ba88f8333bc39725f9cb5bd0b8

Scope and Contents

Collection

System Dynamic Society Records

Scope and Contents

Collecting area

• This collection is part of the University Archives