Coping with changing risks in utility capital investments

Journal Article · Thu Mar 01 00:00:00 EST 1984 · Public Util. Fortn.; (United States)

OSTI ID:5141418

Geraghty, D M

The debate on the efficacy of different types of electric utility investments over the last decade has been fragmentary. There have been advocates of least-cost strategies, improved regulatory techniques, ''small'' versus ''big'' technologies, politically satisfying investments, maximizing long-run benefits, and so on. In addition, many contributors to the debate have pointed out that uncertainty or risk is pervasive throughout all of the investment alternatives and that the proper accounting for risk in investment decision making is crucial. All these positions have merits in their own right but very little has been done to integrate all the pieces of the debate. This article proposes that meaningful analyses and choices between investment decisions cannot be accomplished unless one considers some key characteristics of each investment simultaneously. The first half discusses the importance of some of these key characteristics of utility investments and presents some results of recent analyses. The second half concentrates on one specific characteristic, risk, and suggests ways to manage it for different types of investments. 13 references, 14 figures, 3 tables.

• Research Organization: Electric Power Research Inst., Palo Alto, CA
• OSTI ID: 5141418
• Journal Information: Public Util. Fortn.; (United States), Vol. 113:5
• Country of Publication: United States
• Language: English

Related Subjects

32 ENERGY CONSERVATION, CONSUMPTION, AND UTILIZATION
29 ENERGY PLANNING
POLICY AND ECONOMY
ELECTRIC UTILITIES
INVESTMENT
DECISION MAKING
RISK ASSESSMENT
PUBLIC UTILITIES
320603* - Energy Conservation
Consumption
& Utilization- Municipalities & Community Systems- Public Utilities- (1980-)
296000 - Energy Planning & Policy- Electric Power
290200 - Energy Planning & Policy- Economics & Sociology