Campus Units

Industrial and Manufacturing Systems Engineering

Document Type

Article

Publication Version

Submitted Manuscript

Publication Date

2012

Journal or Book Title

The Engineering Economist

Volume

57

First Page

55

Last Page

75

DOI

10.1080/0013791X.2011.651566

Abstract

In recent years, there has been a substantial increase in renewable power production sites. However, such sites operated in the 1980s were often abandoned in the 1990s and their remnants are still visible. Hence, it is highly desirable to understand the exit and entry decisions of such sites. Toward this goal, we formulate and analyze models for such decisions regarding a single site from a real options perspective when the operation and maintenance costs follow a geometric Brownian motion and derive policy implications. An extensive numerical example for a wind farm illustrates some of the key features of this study.

Comments

This is a manuscript of an article published by Taylor & Francis in The Engineering Economist on 2012, available online: http://dx.doi.org/10.1080/0013791X.2011.651566

Copyright Owner

Institute of Industrial Engineers

Language

en

File Format

application/pdf

Published Version

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