A flexible tool for integrated planning of active distribution networks

This paper presents a flexible and integrated planning tool for active distribution network to maximise the benefits of having high level s of renewables, customer engagement, and new technology implementations. The tool has two main processing parts: “optimisation” and “forecast”. The “optimization” part is an automated and integrated planning framework to optimize the net present value (NPV) of investment strategy for electric distribution network augmentation over large areas and long planning horizons (e.g. 5 to 20 years) based on a modified particle swarm optimization (MPSO). The “forecast” is a flexible agent-based framework to produce load duration curves (LDCs) of load forecasts for different levels of customer engagement, energy storage controls, and electric vehicles (EVs). In addition, “forecast” connects the existing databases of utility to the proposed tool as well as outputs the load profiles and network plan in Google Earth. This integrated tool enables different divisions within a utility to analyze their programs and options in a single platform using comprehensive information.

Optimal Risk Adoption: A Real Options Approach

This study develops a real options approach for analyzing the optimal risk adoption policy in an environment where the adoption means a switch from one stochastic flow representation into another. We establish that increased volatility needs not decelerate investment, as predicted by the standard literature on real options, once the underlying volatility of the state is made endogenous. We prove that for a decision maker with a convex (concave) objective function, increased post-adoption volatility increases (decreases) the expected cumulative present value of the post-adoption profit flow, which consequently decreases (increases) the option value of waiting and, therefore, accelerates (decelerates) current investment.

Optimal management of conflicting species: Grey seal (Halichoerus grypus) and Atlantic salmon (Salmo salar) in the Baltic Sea

The objective of this thesis is to examine the economic effects in the conflict between grey seal population and the salmon fishery in the Baltic Sea. We will formulate a bioeconomic model which provides new insights on the optimal management of Atlantic salmon with respect to the effects brought about by the grey seal population. As the catch losses caused by seals have an effect on salmon fishery in Baltic, we will study how seal population affects the present value of the salmon fishery. The study considers the Finnish coastal trap net fishery. The bioeconomic model considers a scenario of sole salmon fishery and a scenario of salmon fishery affected by the grey seal population. On the basis of these scenarios, a seal compensation scheme is introduced. We can observe a significant economic seal-induced effect on the salmon fishery. The results suggest that the present seal compensation scheme emploid by the Finnish government is suboptimal. This thesis is part of the TARMO –project, in which the conflict between grey seal population and salmon fishery is studied using the methods of environmental economics.

Hydropower Project Design Incorporating Submergence Costs

Submergence of land is a major impact of large hydropower projects. Such projects are often also dogged by siltation, delays in construction and heavy debt burdens-factors that are not considered in the project planning exercise. A simple constrained optimization model for the benefit~ost analysis of large hydropower projects that considers these features is proposed. The model is then applied to two sites in India. Using the potential productivity of an energy plantation on the submergible land is suggested as a reasonable approach to estimating the opportunity cost of submergence. Optimum project dimensions are calculated for various scenarios. Results indicate that the inclusion of submergence cost may lead to a substanual reduction in net present value and hence in project viability. Parameters such as project lifespan, con$truction time, discount rate and external debt burden are also of significance. The designs proposed by the planners are found to be uneconomic, whIle even the optimal design may not be viable for more typical scenarios. The concept of energy opportunity cost is useful for preliminary screening; some projects may require more detailed calculations. The optimization approach helps identify significant trade-offs between energy generation and land availability.

Optimal multispecies fishery management in the Baltic Sea: A bioeconomic analysis

The aim of the thesis is to assess the fishery of Baltic cod, herring and sprat by simulation over 50 years time period. We form a bioeconomic multispecies model for the species. We include species interactions into the model because especially cod and sprat stocks have significant effects on each other. We model the development of population dynamics, catches and profits of the fishery with current fishing mortalities, as well as with the optimal profit maximizing fishing mortalities. Thus, we see how the fishery would develop with current mortalities, and how the fishery should be developed in order to yield maximal profits. Especially cod stock has been quite low recently and by optimizing the fishing mortality it could get recovered. In addition, we assess what would happen to the fisheries of the species if more favourable environmental conditions for cod recruitment dominate in the Baltic Sea. The results may yield new information for the fisheries management. According to the results the fishery of Baltic cod, herring and sprat are not at the most profitable level. The fishing mortalities of each species should be lower in order to maximize the profits. By fishing mortality optimizing the net present value would be almost three times higher in the simulation period. The lower fishing mortality of cod would result in a cod stock recovery. If the environmental conditions in the Baltic Sea improved, cod stock would recover even without a decrease in the fishing mortality. Then the increased cod stock would restrict herring and sprat stock remarkably, and harvesting of these species would not be as profitable anymore.

Pulse vs. Optimal Stationary Fishing: The Northern Stock of Hake

Pulse fishing may be a global optimal strategy in multicohort fisheries. In this article we compare the pulse fishing solutions obtained by using global numerical methods with the analytical stationary optimal solution. This allows us to quantify the potential benefits associated with the use of periodic fishing in the Northern Stock of hake. Results show that: first, management plans based exclusively on traditional reference targets as Fmsy may drive fishery economic results far from the optimal; second, global optimal solutions would imply, in a cyclical manner, the closure of the fishery for some periods and third, second best stationary policies with stable employment only reduce optimal present value of discounted profit in a 2%.

Lessons from the northern hake long-term management plan: Could the economic assessment have accepted it?

An economic expert working group (STECF/SGBRE-07-05) was convened in 2007 for evaluating the potential economic consequences of a Long-Term Management Plan for the northern hake. Analyzing all the scenarios proposed by biological assessment, they found that keeping the F in the status quo level was the best policy in terms of net present values for both yield and profits. This result is counter intuitive because it may indicate that effort costs do no affect the economic reference points. However, it is well accepted that the inclusion of costs affects negatively the economic reference points. In this paper, applying a dynamic agestructured model to the northern hake, we show that the optimal fishing mortality that maximizes the net present value of profits is lower than Fmax.

Why Economists Reject Long-Term Fisheries Management Plans?

Most fisheries agencies conduct biological and economic assessments independently. This independent conduct may lead to situations in which economists reject management plans proposed by biologists. The objective of this study is to show how to find optimal strategies that may satisfy biologists and economists' conditions. In particular we characterize optimal fishing trajectories that maximize the present value of a discounted economic indicator taking into account the age-structure of the population as in stock assessment methodologies. This approach is applied to the Northern Stock of Hake. Our main empirical findings are: i) Optimal policy may be far away from any of the classical scenarios proposed by biologists, ii) The more the future is discounted, the higher the likelihood of finding contradictions among scenarios proposed by biologists and conclusions from economic analysis, iii) Optimal management reduces the risk of the stock falling under precautionary levels, especially if the future is not discounted to much, and iv) Optimal stationary fishing rate may be very different depending on the economic indicator used as reference.

Markov Switching Risk Premium and the term structure of interest rates. Empirical evidence from US post-war interest rates

This paper considers the basic present value model of interest rates under rational expectations with two additional features. First, following McCallum (1994), the model assumes a policy reaction function where changes in the short-term interest rate are determined by the long-short spread. Second, the short-term interest rate and the risk premium processes are characterized by a Markov regime-switching model. Using US post-war interest rate data, this paper finds evidence that a two-regime switching model fits the data better than the basic model. The estimation results also show the presence of two alternative states displaying quite different features.

Artisanal canoe fishing industry of the Rivers State: its economic viability and investment potentials

Consequent upon the present national call in Nigeria for all to go back to agriculture including fishing, most retrenched workers and unemployed youths from the riverine areas are taking up fishing as a legitimate and gainful livelihood. To sustain this tempo and attract more investment, the economic viability of such projects must be known. This study is an attempt to document the profitability and investment potential of artisanal canoe fishing. Socio-economic information including catches, operational cost and returns were obtained through a personal interview questionnaire survey of 240 randomly selected artisanal canoe fishermen from Bonny, Brass and Degema Local Government Areas (LGA) of the State and analyzed. With an investment cost of about 8,135, 8,490 and 6,571 and operation cost of 750, 776 and 627, the analysis showed an average monthly gross income of 1,869, 3,221 and 1,775 for the three local government areas respectively. A benefit-cost-ratio of 1:8, net present value of 400, 603 and internal rate of return greater than 50% were obtained. Since capital invested in fisheries is not tied up for long before benefits start flowing, coupled with the high IRR, it is concluded that artisanal canoe fishing would be an economically viable venture if well managed

Economic analysis of utilizing Kainji gas kiln for fish smoking in the Kainji Lake Basin of Nigeria

Marketing of smoked fish in the Kainji Lake Basin (Nigeria) has been found to be complex, traditional and inefficient. It is also said to be limited in scope due to poor handling and processing techniques, lack of storage facilities and inadequate marketing informations. The invention of Kainji gas kiln has been found suitable to overcoming poor handling and processing techniques. This paper discusses the feasibility of operating Kainji gas kiln commercially supported with adequate storage facilities and competent management hands. The financial indicators of net present value (NPV), 47,481.11, Internal rate of return (IRR) 24% and payback period of 2.3 years that are calculated confirmed that the commercial use of Kainji gas kiln is indeed profitably feasible

Adapting to climate change: Combining economics and geomorphology in coastal policy

How is climate change affecting our coastal environment? How can coastal communities adapt to sea level rise and increased storm risk? These questions have garnered tremendous interest from scientists and policy makers alike, as the dynamic coastal environment is particularly vulnerable to the impacts of climate change. Over half the world population lives and works in a coastal zone less than 120 miles wide, thereby being continuously affected by the changes in the coastal environment [6]. Housing markets are directly influenced by the physical processes that govern coastal systems. Beach towns like Oak Island in North Carolina (NC) face severe erosion, and the tax assesed value of one coastal property fell by 93% in 2007 [9]. With almost ninety percent of the sandy beaches in the US facing moderate to severe erosion [8], coastal communities often intervene to stabilize the shoreline and hold back the sea in order to protect coastal property and infrastructure. Beach nourishment, which is the process of rebuilding a beach by periodically replacing an eroding section of the beach with sand dredged from another location, is a policy for erosion control in many parts of the US Atlantic and Pacific coasts [3]. Beach nourishment projects in the United States are primarily federally funded and implemented by the Army Corps of Engineers (ACE) after a benefit-cost analysis. Benefits from beach nourishment include reduction in storm damage and recreational benefits from a wider beach. Costs would include the expected cost of construction, present value of periodic maintenance, and any external cost such as the environmental cost associated with a nourishment project (NOAA). Federal appropriations for nourishment totaled $787 million from 1995 to 2002 [10]. Human interventions to stabilize shorelines and physical coastal dynamics are strongly coupled. The value of the beach, in the form of storm protection and recreation amenities, is at least partly capitalized into property values. These beach values ultimately influence the benefit-cost analysis in support of shoreline stabilization policy, which, in turn, affects the shoreline dynamics. This paper explores the policy implications of this circularity. With a better understanding of the physical-economic feedbacks, policy makers can more effectively design climate change adaptation strategies. (PDF contains 4 pages)

An Alternative View of the US Price-Dividend Ratio Dynamics

As a necessary condition for the validity of the present value model, the price-dividend ratio must be stationary. However, significant market episodes seem to provide evidence of prices significantly drifting apart from dividends while other episodes show prices anchoring back to dividends. This paper investigates the stationarity of this ratio in the context of a Markov- switching model à la Hamilton (1989) where an asymmetric speed of adjustment towards a unique attractor is introduced. A three-regime model displays the best regime identification and reveals that the first part of the 90’s boom (1985-1995) and the post-war period are characterized by a stationary state featuring a slow reverting process to a relatively high attractor. Interestingly, the latter part of the 90’s boom (1996-2000), characterized by a growing price-dividend ratio, is entirely attributed to a stationary regime featuring a highly reverting process to the attractor. Finally, the post-Lehman Brothers episode of the subprime crisis can be classified into a temporary nonstationary regime.

Breaking the 400 ppm barrier: Physical and Social implications of the recent CO2 rise

6 p.

Rompiendo la barrera de las 400 ppm: implicaciones físicas y sociales del reciente aumento de CO2

6 p.