Journal of Energy Engineering

The lack of precision in an economic analysis of an energy production facility is expressed quantitatively with an uncertainty to the 68% confidence level. The sensitivities of various parameters to imperfect projections is propagated through a fairly simple technique into an overall uncertainty for the feasibility indicator, such as benefit‐cost (BC) ratio. The technique assumes that each of the variable parameters is unrelated, from a Gaussian population, and that the individual sensitivities have a normal probability distribution. The effects of these assumptions on applications of the uncertainty technique are described. The technique is illustrated through a case study involving the economic analyses of hydropower feasibility.

An evaluation of the technology for hydraulic kinetic energy conversion (HKEC) systems for the generation of electricity is given based on the results of a research study carried out for the Canadian Electrical Association (CEA), under their research and development program. The HKEC systems were reviewed using a data base consisting of patents, technical papers, published reports, and company product information. All potential devices were evaluated and classified into five generic groups and potentially viable subgroups. The three technologies selected for more detailed evaluation were the undershot waterwheel, the fixed‐blade nonducted propeller, and the fixed‐blade Darrieus. The basic theory for these is outlined and then they are compared in a given application. Fixed‐propeller type turbines and Darrieus turbines are considered to be the most potentially viable systems. Research and development priorities are summarized.

The management of municipal solid waste requires consideration of the comparative cost of various available management options, such as recycling for recovery of material values and recycling for recovery of energy values by resource recovery. The incineration of municipal solid waste in resource‐recovery plants with subsequent generation of electricity provides a basis for the determination of the fossil‐fuel equivalent value for municipal solid waste. A method for determining the economic value of the recoverable energy content of municipal solid waste is proposed. The method is used to determine the equivalent fossilfuel energy value of municipal solid waste and some of the common combustible components found in municipal solid waste. The equivalent fuel values are then related to some of the most commonly used methods for managing municipal solid waste. The results indicate that recycling of the combustible fraction of municipal solid waste, for material values, may not be economically justified for most combustible components. Additionally, there appear to be few long‐term environmental benefits with which to justify selecting recycling for material values over the recycling of energy values by resource recovery.

Economic analysis can help estimate the benefits and costs of environmental regulations that affect energy industries. The usefulness of tools such as engineering economics, econometrics, and Leontief input‐output analysis is demonstrated by a study of the benefits to Ohio of a controversial brine‐disposal practice: annular disposal. Its direct benefits are the avoided costs of more expensive, but safer, disposal via deep‐well injection. Its indirect benefits include impact upon the region's employment and income. This impact was estimated by first constructing econometric models of oil and gas drilling and production in Ohio. Those models were then used to forecast drilling and production both with and without the added cost of deep‐well injection. The resulting changes in the industry's activity were then inserted in an input‐output model in order to calculate changes in employment and income. The analysis shows that in two areas of Ohio, the direct benefits alone are an order of magnitude larger than the expected cost of water supplies lost due to failure of annular disposal. However, health and policy considerations may still justify a ban of the practice.