o ak r idge n ational l aboratory u. s. d epartment of e nergy 1 ideas on a framework and methods...

1

OAK RIDGE NATIONAL LABORATORYU. S. DEPARTMENT OF ENERGY

Ideas on a Framework and Methods for Ideas on a Framework and Methods for Estimating the Benefits of Government-Estimating the Benefits of Government-

Sponsored Energy R&DSponsored Energy R&D

Russell LeeRussell LeeOak Ridge National LaboratoryOak Ridge National Laboratory

Presented at the conference on Presented at the conference on “Estimating the Benefits of Government-Sponsored Energy R&D,” “Estimating the Benefits of Government-Sponsored Energy R&D,”

Arlington, VA, Arlington, VA, March 4 and 5, 2002March 4 and 5, 2002

2


Build on National Research Council Framework Build on National Research Council Framework to Do to Do Prospective Analysis for GPRA and Analysis for GPRA and

Program PlanningProgram Planning

RealizedRetrospective

ExpectedProspective

Option Knowledge

Economic

Environmental

Security

3


Expected Prospective Benefits (e.g., energy consumption):Expected Prospective Benefits (e.g., energy consumption):

Energy Consumption in Reference Case W/O TechnologyMINUSMINUSEnergy Consumption in Reference Case With ItMINUSMINUSNet Change in Costs of New Technology

0 Time T

Energy Consumption (expressed in $)

1. NEMS Reference Case

3. Specialized Model W/O Technology, Calibrated to NEMS

2. NEMS Reference Case with Improvement in Technology Category Backed Out

4. Specialized Model With Technology

4


What Portion(s) Can We “Credit” to the Government R&D Program?

Government R&D Could be Justified If There Are …Barriers to Entry, Imperfect Information, Externalities, Public Goods, National Security Risks, or Non-Competitive Practices and …

Total Benefits Exceed Total Costs

5


Impact of the Government R&D Program Could be Impact of the Government R&D Program Could be An Acceleration of Technology CommercializationAn Acceleration of Technology Commercialization

What is t?

6


R&D R&D CouldCould Lead to Lead to OptionsOptions that Provide Choices to Deal that Provide Choices to Deal

with Deviations from the Planned, Baseline Scenariowith Deviations from the Planned, Baseline Scenario

0 Time

Benefits and Costs of the Technology that Results from R&D

How Can Real Options Analysis Be Adapted When It Is “Impossible” to Get Estimates of Risks and Uncertainties?

7


Prospective Knowledge Benefits Prospective Knowledge Benefits

Peer review process adapted to prospective planning needs

Use statistically derived relationships between attributes of research, their publications, and their linkages with patents

8


Focus on Energy Security Focus on Energy Security


ExpectedProspective

Option Knowledge

Economic

Environmental

Security

9


Probabilistic Risk Analysis of ...Probabilistic Risk Analysis of ...Alternative Energy Infrastructure and Systems ... Alternative Energy Infrastructure and Systems ... Could Provide Estimates of Benefits of R&D that ...Could Provide Estimates of Benefits of R&D that ...Reduces Likelihood or Impacts of Disruptive EventsReduces Likelihood or Impacts of Disruptive Events

10



ExpectedProspective

Option Knowledge

Economic

Environmental

Security

Each Workshop Focuses on ...Each Workshop Focuses on ...A Key Element of the Benefits Framework to …A Key Element of the Benefits Framework to …Develop Ideas About Practical, Cost-Effective MethodsDevelop Ideas About Practical, Cost-Effective Methods

o ak r idge n ational l aboratory u. s. d epartment of e nergy 1 ideas on a framework and methods...

Documents