Federal Support for alternate energy technologies has gone through a boom/bust cycle during the Carter and Regan administrations. To investigate the effects of these policies, I use a system dynamics model of the industrial market penetration of parabolic troughs as a case study. The Regan policy, a laissez-faire policy, lets free market forces determine the market penetration. The Carter policy, an active government policy, combines research, development and demonstration with information dissemination and market financial incentives. The optimal policy depends upon future energy prices. If the price of conventional energy remains low, parabolic troughs never become competitive even with significant government support and thus the laissez-faire policy reduces federal expenditures by ~ $60 million with no negative effects. If the price of unconventional energy increases significantly, however, free-market forces do not develop parabolic troughs into a practical energy source without the benefit of an active government program. If this case study is generalizable to other alternate energy technologies, an active government role in alternate energy technology development should be thought as an insurance policy. How much is it worth to the U.S. today to insure future price stability?

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Date created

• 1983

Type

• Document

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

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

  
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Collection

System Dynamic Society Records

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Collecting area

• This collection is part of the University Archives