A strategic review of electricity systems models

Electricity systems models are software tools used to manage electricity demand and the electricity systems, to trade electricity and for generation expansion planning purposes. Various portfolios and scenarios are modelled in order to compare the effects of decision making in policy and on business development plans in electricity systems so as to best advise governments and industry on the least cost economic and environmental approach to electricity supply, while maintaining a secure supply of sufficient quality electricity. The modelling techniques developed to study vertically integrated state monopolies are now applied in liberalised markets where the issues and constraints are more complex. This paper reviews the changing role of electricity systems modelling in a strategic manner, focussing on the modelling response to key developments, the move away from monopoly towards liberalised market regimes and the increasing complexity brought about by policy targets for renewable energy and emissions. The paper provides an overview of electricity systems modelling techniques, discusses a number of key proprietary electricity systems models used in the USA and Europe and provides an information resource to the electricity analyst not currently readily available in the literature on the choice of model to investigate different aspects of the electricity system.

The Cost of Drug Use in Adolescence: Young People, Money and Substance Abuse.

It is now common for young people in full-time compulsory education to hold part-time jobs. However, whilst the 1990s experienced a rise in illicit drug use particularly among young people and an increase in the level of interest for identifying factors associated with drug use, little attention has been paid to the influence of the money young people have to spend and its potential links with drug use. Four thousand five hundred and twenty-four young people living in Northern Ireland completed a questionnaire in school year 10 (aged 13/14 years). The findings suggested there was a positive association between the amount of money (and its source) young people received and higher rates of drug use. The study concludes that money, and how it is spent by young people, may be an important factor for consideration when investigating drug use during adolescence. The findings may help inform drug prevention strategies particularly through advice on money management, and taking responsibility for their own money.

The Cost of Sustainability Capital and the Creation of Sustainable Value by Companies

We develop and apply a valuation methodology to calculate the cost of sustainability capital, and, eventually, sustainable value creation of companies. Sustainable development posits that decisions must take into account all forms of capital rather than just economic capital. We develop a methodology that allows calculation of the costs that are associated with the use of different forms of capital. Our methodology borrows the idea from financial economics that the return on capital has to cover the cost of capital. Capital costs are determined as opportunity costs, that is, the forgone returns that would have been created by alternative investments. We apply and extend the logic of opportunity costs to the valuation not only of economic capital but also of other forms of capital. This allows (a) integrated analysis of use of different forms of capital based on a value-based aggregation of different forms of capital, (b) determination of the opportunity cost of a bundle of different forms of capital used in a company, called cost of sustainability capital, (c) calculation of sustainability efficiency of companies, and (d) calculation of sustainable value creation, that is, the value above the cost of sustainability capital. By expanding the well-established logic of the valuation of economic capital in financial markets to cover other forms of capital, we provide a methodology that allows determination of the most efficient allocation of sustainability capital for sustainable value creation in companies. We demonstrate the practicability of the methodology by the valuation of the sustainability performance of British Petroleum (BP).

Economic cost of age-related macular degeneration: a review of recent research

As the population of most developed countries ages so the prevalence of diseases such as age-related macular degeneration (AMD) are likely to increase. To facilitate planning and informed debate regarding making provisions for this disease it is important that we have a clear understanding of the economic impact of visual impairment associated with AMD. In this paper we assess the state of current knowledge based on a review of published evidence in scientific journals. Based on our assessment of the evidence we argue that the paucity of research studies on the subject and wide variation in estimates produced from the few studies available make it difficult to assess with confidence the likely average direct cost-of-illness associated with AMD. We further argue that significant gaps in our understanding of the costs of AMD (particularly in respect of indirect costs) also exist. Current research should be augmented by more comprehensive studies.

The cost of water from an autonomous wave-powered desalination plant

A techno-economic model of an autonomous wave-powered desalination plant is developed and indicates that fresh water can be produced for as little as £0.45/m3. The advantages of an autonomous wave-powered desalination plant are also discussed indicating that the real value of the system is enhanced due to its flexibility for deployment and reduced environmental impact. The modelled plant consists of the Oyster wave energy converter, conventional reverse osmosis membranes and a pressure exchanger–intensifier for energy recovery. A time-domain model of the plant is produced using wave-tank experimentation to calibrate the model of Oyster, manufacturer's data for the model of the reverse osmosis membranes and a hydraulic model of the pressure exchanger–intensifier. The economic model of the plant uses best-estimate cost data which are reduced to annualised costs to facilitate the calculation of the cost of water. Finally, the barriers to the deployment of this technology are discussed, but they are not considered insurmountable.

Irish Credit Unions: Investigating performance determinants and the opportunity cost of regulatory compliance

The study investigates how producer-specific environmental factors influence the performance of Irish credit unions. The empirical analysis uses a two-stage approach. The first stage measures efficiency by a data envelopment analysis (DEA) estimator, which explicitly incorporates the production of undesirable outputs such as bad loans in the modelling, and the second stage uses truncated regression to infer how various factors influence the (bias-corrected) estimated efficiency. A key finding of the analysis is that 68% of Irish credit unions do not incur an extra opportunity cost in meeting regulatory guidance on bad debt.

Climate change and the cost of conserving species in Madagascar

We examined the cost of conserving species as climate changes using Madagascar as an example. We used a Maxent species distribution model to predict the ranges of 74 plant species endemic to the forests of Madagascar from 2000-2080 in three climate scenarios. We set a conservation target of achieving 10,000 hectares of forest cover for each species, and calculated the cost of achieving this target under each climate scenario. We interviewed natural forest restoration project managers and conducted a literature review to obtain the net present cost per hectare of management actions to maintain or establish forest cover. For each species we added hectares of land from lowest to highest cost per additional year of forest cover until the conservation target was achieved throughout the time period. Climate change was predicted to reduce the size of species’ ranges, the overlap between species’ ranges and existing or planned protected areas, and the overlap between species’ ranges and existing forest. As a result, climate change increased the cost of achieving the conservation target by necessitating successively more costly management actions: additional management within existing protected areas (US$0-60/ha), avoidance of forest degradation (loss of biomass) in community-managed areas ($160-576/ha), avoidance of deforestation in unprotected areas ($252-1069/ha), and establishment of forest on non-forested land within protected areas ($802-2710/ha), in community-managed areas ($962-3226/ha), and in unprotected areas ($1054-3719/ha). Our results suggest that though forest restoration may be required for the conservation of some species as climate changes, it is more cost-effective to maintain existing forest wherever possible.

Environmental pricing of externalities from different sources of electricity generation in Chile

The rapid increase in electricity demand in Chile means a choice must be made between major investments in renewable or non-renewable sources for additional production. Current projects to develop large dams for hydropower in Chilean Patagonia impose an environmental price by damaging the natural environment. On the other hand, the increased use of fossil fuels entails an environmental price in terms of air pollution and greenhouse gas emissions contributing to climate change. This paper studies the debate on future electricity supply in Chile by investigating the preferences of households for a variety of different sources of electricity generation such as fossil fuels, large hydropower in Chilean Patagonia and other renewable energy sources. Using Double Bounded Dichotomous Choice Contingent Valuation, a novel advanced disclosure method and internal consistency test are used to elicit the willingness to pay for less environmentally damaging sources. Policy results suggest a strong preference for renewable energy sources with higher environmental prices imposed by consumers on electricity generated from fossil fuels than from large dams in Chilean Patagonia. Policy results further suggest the possibility of introducing incentives for renewable energy developments that would be supported by consumers through green tariffs or environmental premiums. Methodological findings suggest that advanced disclosure learning overcomes the problem of internal inconsistency in SB-DB estimates.