The Risk of Suprise in Energy Technology Costs

Hultman, Nathan and Koomey, Jonathan (2007) The Risk of Suprise in Energy Technology Costs. Environmental Research Letters, 2 (3). pp. 1-6.

Abstract

As countries begin to reassess and expand their energy research and development programs, it is appropriate to understand the likely costs of alternate approaches. Unfortunately, communities of experts have a well-known optimistic bias in their judgments. We review findings from several disciplines that underscore this tendency toward overconfidence as well as some proposed alternatives to incorporate it in public decision-making. We further argue, based on a disaggregated analysis of US nuclear power costs, that incorporating a second-order uncertainty in the shape of the distribution of cost components is essential for capturing important elements of uncertainty in moving forward with expanded energy R&D programs.

Item Type: Article
Keywords: Nuclear physics; Environmental and Earth science; Statistical physics and nonlinear systems
Subject(s): Science & technology management
Centre: Institute for Science, Innovation and Society
Date Deposited: 05 Feb 2012 15:35
Last Modified: 23 Oct 2015 14:06
URI: http://eureka.sbs.ox.ac.uk/id/eprint/1762

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