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Contribution Details
Type | Book Chapter |
Scope | Discipline-based scholarship |
Title | Efficient and secure power for the United States and Switzerland |
Organization Unit | |
Authors |
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Editors |
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Item Subtype | Original Work |
Refereed | No |
Status | Published in final form |
Language |
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Booktitle | Analytical methods for energy diversity and security: portfolio optimization in the energy sector : a tribute to the work of Dr. Shimon Awerbuch |
Series Name | Global Energy Policy and Economics |
ISBN | 978-0-08-056887-4 |
Number | 12 |
Place of Publication | New York |
Publisher | Elsevier |
Page Range | 193 - 218 |
Date | 2008 |
Abstract Text | In this contribution, portfolio theory is applied to power technologies of the United States and Switzerland. A current user view is adopted to determine the efficient frontier of generation technologies in terms of expected return and risk. Since shocks in generation costs per kWh (the inverse of expected returns) are correlated, seemingly unrelated regression estimation (SURE) is applied to filter out the systematic components of the covariance matrix. Since some of the portfolios of particular interest (minimum variance, maximum expected return) call for a high share of one technology, security of supply becomes an issue. Shannon-Wiener and Herfindahl-Hirschman indices are calculated to see the trade-off between efficiency and security of supply. Results suggest that riskaverse utilities (and ultimately, consumers) in the United States would have gained from adopting a feasible portfolio containing more coal, gas and oil at a price of a somewhat reduced security of supply. In the case of Switzerland, the realistic portfolio consists of nuclear, storage hydro, run of river and solar, with shares identical to those of the actual portfolio in 2003. Therefore, the current mix of Swiss generating technologies in Switzerland may be deemed efficient. |
Official URL | http://www.elsevier.com/wps/find/bookdescription.cws_home/716397/description#description |
Digital Object Identifier | 10.1016/B978-0-08-056887-4.00010-X |
PDF File | Download from ZORA |
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