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Impact of myopic decision-making and disruptive events in power systems planning

Author

Listed:
  • Clara F. Heuberger

    (Imperial College London
    Imperial College London)

  • Iain Staffell

    (Imperial College London)

  • Nilay Shah

    (Imperial College London
    Imperial College London)

  • Niall Mac Dowell

    (Imperial College London
    Imperial College London)

Abstract

The delayed deployment of low-carbon energy technologies is impeding energy system decarbonization. The continuing debate about the cost-competitiveness of low-carbon technologies has led to a strategy of waiting for a ‘unicorn technology’ to appear. Here, we show that myopic strategies that rely on the eventual manifestation of a unicorn technology result in either an oversized and underutilized power system when decarbonization objectives are achieved, or one that is far from being decarbonized, even if the unicorn technology becomes available. Under perfect foresight, disruptive technology innovation can reduce total system cost by 13%. However, a strategy of waiting for a unicorn technology that never appears could result in 61% higher cumulative total system cost by mid-century compared to deploying currently available low-carbon technologies early on.

Suggested Citation

  • Clara F. Heuberger & Iain Staffell & Nilay Shah & Niall Mac Dowell, 2018. "Impact of myopic decision-making and disruptive events in power systems planning," Nature Energy, Nature, vol. 3(8), pages 634-640, August.
    • Handle: RePEc:nat:natene:v:3:y:2018:i:8:d:10.1038_s41560-018-0159-3
    DOI: 10.1038/s41560-018-0159-3
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    Cited by:

    1. Andreas Sahlberg & Babak Khavari & Ismail Mohamed & Francesco Fuso Nerini, 2023. "Comparison of Least-Cost Pathways towards Universal Electricity Access in Somalia over Different Timelines," Energies, MDPI, vol. 16(18), pages 1-20, September.
    2. Jing, Rui & Kuriyan, Kamal & Kong, Qingyuan & Zhang, Zhihui & Shah, Nilay & Li, Ning & Zhao, Yingru, 2019. "Exploring the impact space of different technologies using a portfolio constraint based approach for multi-objective optimization of integrated urban energy systems," Renewable and Sustainable Energy Reviews, Elsevier, vol. 113(C), pages 1-1.
    3. Hanna, Richard & Gross, Robert, 2021. "How do energy systems model and scenario studies explicitly represent socio-economic, political and technological disruption and discontinuity? Implications for policy and practitioners," Energy Policy, Elsevier, vol. 149(C).
    4. Charitopoulos, V. & Fajardy, M. & Chyong, C. K. & Reiner, D., 2022. "The case of 100% electrification of domestic heat in Great Britain," Cambridge Working Papers in Economics 2210, Faculty of Economics, University of Cambridge.
    5. Lara Aleluia Reis & Zoi Vrontisi & Elena Verdolini & Kostas Fragkiadakis & Massimo Tavoni, 2023. "A research and development investment strategy to achieve the Paris climate agreement," Nature Communications, Nature, vol. 14(1), pages 1-10, December.
    6. Morgenthaler, Simon & Dünzen, Justus & Stadler, Ingo & Witthaut, Dirk, 2021. "Three stages in the co-transformation of the energy and mobility sectors," Renewable and Sustainable Energy Reviews, Elsevier, vol. 150(C).
    7. Lambert, Jerry & Hanel, Andreas & Fendt, Sebastian & Spliethoff, Hartmut, 2023. "Evaluation of sector-coupled energy systems using different foresight horizons," Renewable and Sustainable Energy Reviews, Elsevier, vol. 184(C).
    8. Zhao, Ning & You, Fengqi, 2020. "Can renewable generation, energy storage and energy efficient technologies enable carbon neutral energy transition?," Applied Energy, Elsevier, vol. 279(C).
    9. Abuzayed, Anas & Hartmann, Niklas, 2022. "MyPyPSA-Ger: Introducing CO2 taxes on a multi-regional myopic roadmap of the German electricity system towards achieving the 1.5 °C target by 2050," Applied Energy, Elsevier, vol. 310(C).
    10. Ángel Galán-Martín & Daniel Vázquez & Selene Cobo & Niall Dowell & José Antonio Caballero & Gonzalo Guillén-Gosálbez, 2021. "Delaying carbon dioxide removal in the European Union puts climate targets at risk," Nature Communications, Nature, vol. 12(1), pages 1-12, December.
    11. Valeriya Azarova & Mathias Mier, 2021. "Unraveling the Black Box of Power Market Models," ifo Working Paper Series 357, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.
    12. Sitarz, Joanna & Pahle, Michael & Osorio, Sebastian & Luderer, Gunnar & Pietzcker, Robert, 2023. "EU carbon prices signal high policy credibility and farsighted actors," EconStor Preprints 280455, ZBW - Leibniz Information Centre for Economics.
    13. Jessica Thomsen & Noha Saad Hussein & Arnold Dolderer & Christoph Kost, 2021. "Effect of the Foresight Horizon on Computation Time and Results Using a Regional Energy Systems Optimization Model," Energies, MDPI, vol. 14(2), pages 1-22, January.
    14. Boza, Pal & Evgeniou, Theodoros, 2021. "Artificial intelligence to support the integration of variable renewable energy sources to the power system," Applied Energy, Elsevier, vol. 290(C).

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