Prospective Evaluation of Applied Energy Research and Development at DOE (Phase Two) (2007) / Chapter Skim
Currently Skimming:
Appendix M Report of the Panel on DOE's Chemical Industrial Technologies Program
Appendix M Report of the Panel on DOE's Chemical Industrial Technologies Program
Pages 208-219
The Chapter Skim interface presents what we've algorithmically identified as the most significant single chunk of text within every page in the chapter.
Select key terms on the right to highlight them within pages of the chapter.
From page 208... ...
Program, and to Energetics, Inc., the program's technical The panel's assignment was to estimate the benefits of assistance contractor, for outstanding support of the panel's the Chemical Industrial Technologies Program, taking into work. account technical and market risks.
|
From page 209... ...
To focus their shrinking budget on the highest payyet to be started will increase the savings. off projects, the DOE management team is trying to stimulate The current Chemical Industrial Technologies Program industry research and to fund projects that would not be posas administered by DOE funds projects in three subprogram sible without federal assistance, and is accelerating progress areas: on projects that might be funded by industry sometime in the future.
|
From page 210... ...
7This result is consistent with research into the success rate of projects of this type. For example, in its presentations DOE compared the Chemical 6The initial estimates were made between the first and second panel Industrial Technologies Program to studies that found an overall success rate meetings and discussed at the second meeting.
|
From page 211... ...
the same for each of the three global scenarios -- that is, in the AEO Reference Case, High Oil and Gas Prices scenario, role of doe Funding and the Carbon Constrained scenario. In developing their benefits estimates for each project, DOE assumed that the research being funded will accelerBenefits estimation ate the development and implementation of the identified The economic, environmental, and security benefits of the technology, but that the technology would eventually have Chemical Industrial Technologies Program derive directly been developed by industry if DOE were not supporting from the energy savings resulting from the projects.
|
From page 212... ...
Based on this result, the panel concluded that summarY aNd coNclusioNs bottom-up methodology was more useful for the analysis of a portfolio of diverse and unrelated projects. The panel believes that the benefits estimation methodol ogy developed for Phase Two has successfully applied to the Net economic Benefits calculation 9This reduction in estimated benefits is largely modest, because the The economic benefits estimated above, like those es payback assumption embodies a relatively high private sector hurdle rate, timated by DOE, represent the gross economic benefits of while public benefits are discounted at a lower rate (between 3 percent and the program–that is, the estimate includes all the benefits 7 percent)
|
From page 213... ...
FIGURE M-2 Uncertainty surrounding estimates of program benefits.
|
From page 214... ...
On the basis of expected to generate earnings sooner after start-up since the m-3.eps its evaluation, the panel also concludes that the Chemical primary objective is cost savings, not increased volume. Industrial Technologies Program is addressing an important Against this background, and based on the experience opportunity to produce energy savings in a major industrial of its members in managing and conducting research in segment by supporting early-stage research that industry is the chemical industry, the panel wishes to underscore how unlikely to support.
|
From page 215... ...
Estimated probability of market success for projects ranges from 10% to 70%. Expected Economic benefits are calculated as the expected value of energy savings benefits Economic Benefits from 2006 to 2030 resulting from the research portfolio, in 2003 dollars.
|
From page 216... ...
The distribution of expected benefits at the program level Comments and Observations can be inferred from the probability distributions developed by simulating the outcome of the program based on project- The goal of the Chemical Industrial Technologies Prolevel risk estimates. Figure M-2 shows the result of this simu- gram is to implement a successful DOE research program lation for the Chemical Industrial Technologies Program.
|
From page 217... ...
Net benefits Benefits Estimation are calculated by assuming that for any project that "suc ceeds," investments on the order of the net present value of The economic, environmental, and security benefits of the the economic benefits for first 3 years will be required. Chemical Industrial Technologies Program derive directly
|
From page 218... ...
He left DOE in 1996 but reResearch Institute, and the Office of Technology Assessment. mained on its Secretary of Energy Advisory Board, LaboraHe served as chairman of the NRC Committee on Benefits tory Operations Board, Sandia President's Advisory Council, of DOE's R&D in Energy Efficiency and Fossil Energy and and the National Renewable Energy Laboratory's Advisory of the Committee on Prospective Benefits of DOE's Energy Council for several more years before resigning a few years Efficiency and Fossil Energy R&D Programs, Phase One.
|
From page 219... ...
His other interests include computational chem management from the MIT Sloan School of Management. istry, process dynamics, turbulent fluid flow, computational fluid dynamics, reaction engineering, sensitivity/uncertainty William J
|
Key Terms
This material may be derived from roughly machine-read images, and so is provided only to facilitate research.
More
information on Chapter Skim is available.