Energy Planning in the United States and Europe: A Portfolio-Based Approach

Paul S. Lowengrub, Spencer Yang
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Abstract

Traditional energy planning in Europe and the United States focuses on finding the least-cost generating alternative. This approach worked sufficiently well in a technological era marked by relative cost certainty, low rates of technological progress, technologically homogenous generating alternatives, and stable energy prices. However, today's electricity planner faces a diverse range of resource options and a dynamic, complex, and uncertain future. Attempting to identify least-cost alternatives in this dynamic and uncertain environment is virtually impossible. As a result, more appropriate techniques are required to find strategies that remain economical under a variety of uncertain future outcomes.Given the uncertain environment, it makes sense to shift electricity planning from its current emphasis on identifying the least-cost technologies to the evaluation of alternative electricity generating portfolios and strategies. The techniques for doing this are rooted in modern finance theory - in particular mean-variance portfolio theory. The mean-variance portfolio analysis proposed in this report exemplifies how portfolio costs and risks can be examined and incorporated into policy decisions about future generating resources.This paper applies portfolio-theory optimization concepts from the field of finance to produce an expository evaluation of the multiple regions in the United States and Europe. Although the results are expository, they help show how today's energy planners can assess the potential changes to a portfolio's risks and costs that result from adding renewable resources (such as wind, hydro, and biomass) that have their own individual risk and cost profiles. The resulting risks and costs of alternative combinations of assets will be quantified, and this allows those portfolios that provide the best combinations of costs and risks to be identified as efficient frontier. Conversely, for any given level of cost, there is an associated minimum-risk portfolio. Portfolio analysis allows for the consideration of risk preferences when choosing among portfolios, as well as for the examination of the trade-offs among various risks and costs.
美国和欧洲的能源规划:基于投资组合的方法
欧洲和美国的传统能源规划侧重于寻找成本最低的发电替代方案。这种方法在一个以相对成本确定性、低技术进步率、技术上同质化的发电替代方案和稳定的能源价格为特征的技术时代非常有效。然而,今天的电力规划者面临着各种各样的资源选择和一个动态的、复杂的、不确定的未来。试图在这种动态和不确定的环境中确定成本最低的替代方案实际上是不可能的。因此,需要更合适的技术来寻找在各种不确定的未来结果下保持经济的策略。考虑到不确定的环境,将电力规划从目前强调确定成本最低的技术转向评估替代发电组合和战略是有意义的。这样做的技术根植于现代金融理论——尤其是均值方差投资组合理论。本报告中提出的均值方差投资组合分析举例说明了如何检查投资组合的成本和风险,并将其纳入有关未来发电资源的政策决策中。本文运用金融领域的投资组合理论优化概念,对美国和欧洲的多个地区进行了说明性评价。虽然结果是说明性的,但它们有助于展示今天的能源规划者如何评估由于增加可再生资源(如风能、水电和生物质能)而导致的投资组合风险和成本的潜在变化,这些可再生资源有自己的风险和成本概况。可选择的资产组合所产生的风险和成本将被量化,这允许那些提供成本和风险最佳组合的投资组合被确定为有效前沿。相反,对于任何给定的成本水平,都有一个相关的最小风险投资组合。投资组合分析允许在选择投资组合时考虑风险偏好,以及检查各种风险和成本之间的权衡。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
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