Abstract
SYNOPSIS A consistent methodology for the economic and financial analysis of non-conventional energy projects is presented in this paper. General energy-economic issues and the principles of integrated national energy planning are outlined first, followed by a review of the main stages in processing an energy project. The investment decision from the national viewpoint should be made using economic shadow prices by verifying that the decentralized technology is least-cost, and that the benefits derived from its use exceed the costs. If these requirements are satisfied, similar but separate calculations are performed using market prices to ascertain whether private individuals will find the new technology both financially least-cost and profitable. When one or both of these financial conditions are not met, the government should adjust the relevant market prices and make other policy changes to satisfy the financial criteria. Successful project implementation may begin only after the decentralized energy t...
Published Version
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