Promoting energy efficiency investments with risk management decision tools

作者：Jackson Jerry^*

来源：Energy Policy, 2010, 38(8): 3865-3873.

DOI：10.1016/j.enpol.2010.03.006

• Energy efficiency
• Risk management
• Energy paradox

This paper reviews current capital budgeting practices and their impact on energy efficiency investments. The prevalent use of short payback "rule-of-thumb" requirements to screen efficiency projects for risk is shown to bias investment choices towards "sure bet" investments bypassing many profitable efficiency investment options. A risk management investment strategy is presented as an alternative to risk avoidance practices applied with payback thresholds. The financial industry risk management tool Value-at-Risk is described and extended to provide an Energy-Budgets-at-Risk or EBaR risk management analysis to convey more accurate energy efficiency investment risk information. The paper concludes with recommendations to expand the use of Value-at-Risk-type energy efficiency analysis.

• 出版日期2010-8