Off-campus UMass Amherst users: To download campus access theses, please use the following link to log into our proxy server with your UMass Amherst user name and password.

Non-UMass Amherst users: Please talk to your librarian about requesting this thesis through interlibrary loan.

Theses that have an embargo placed on them will not be available to anyone until the embargo expires.

Document Type

Campus Access

Degree Program

Industrial Engineering & Operations Research

Degree Type

Master of Science (M.S.)

Year Degree Awarded

2010

Month Degree Awarded

February

Keywords

Decision, Climate, Energy, Portfolio, Uncertainty, Optimal

Abstract

We investigate a two stage energy technology research and development (R&D) portfolio decision problem under climate change uncertainty. We consider 23 R&D projects where the success of the funded projects is uncertain. For the first stage we derive portfolios which minimize expected total societal cost by applying decision analysis methods. Between the two stages learning on the climate damages and on the success of the funded projects takes place. At the second stage the optimal abatement level is chosen. Starting with the second stage we solve the problem backwards.

We have two key results. First, optimal portfolios turn out to be very robust against risk. Second, we find that the value of technology is non-monotonic in risk. If damages are very high it is optimal to have full abatement, regardless of technical change. This means there are no environmental side benefits in such a case. For medium risk the value of R&D is the highest.

First Advisor

Erin D. Baker

Share

COinS