The Role of Discounting in Energy Policy Investments

For informing future energy policy decisions, it is essential to choose the correct social discount rate (SDR) for ex-ante economic evaluations. Generally, costs and benefits—both economic and environmental—are weighted through a single constant discount rate. This leads to excessive discounting of the present value of cash flows progressively more distant over time. Evaluating energy projects through constant discount rates would mean underestimating their environmental externalities. This study intends to characterize environmental–economic discounting models calibrated for energy investments, distinguishing between intra- and inter-generational projects. In both cases, the idea is to use two discounting rates: an economic rate to assess financial components and an ecological rate to weight environmental effects. For intra-generational projects, the dual discount rates are assumed to be constant over time. For inter-generational projects, the model is time-declining to give greater weight to environmental damages and benefits in the long-term. Our discounting approaches are based on Ramsey's growth model and Gollier's ecological discounting model; the latter is expressed as a function of an index capable of describing the performance of a country's energy systems. With regards to the models we propose, the novelty lies in the calibration of the "environmental quality" parameter. Regarding the model for long-term projects, another innovation concerns the analysis of risk components linked to economic variables; the growth rate of consumption is modelled as a stochastic variable. The defined models were implemented to determine discount rates for both Italy and China. In both cases, the estimated discount rates are lower than those suggested by governments. This means that the use of dual discounting approaches can guide policymakers towards sustainable investment in line with UN climate neutrality objectives

STIMA DEGLI EFFETTI DELLA RIGENERAZIONE URBANA SUI VALORI IMMOBILIARI

Urban regeneration interventions, increasingly implemented in response to the uncontrolled urbanisation of cities, can generate social, environmental, and economic benefits.  This study aims to investigate how urban regeneration influences the price of residential real estate. This paper compares techniques commonly used in practice, such as Multiple Linear Regression (MLR), and innovative Artificial Intelligence (AI) models like Artificial Neural Networks (ANNs). The analysis shows that some of the criticalities of MLR, such as the inability to handle non-linearity and collinearity between variables, can be overcome by resorting to AI algorithms. However, the latter fail – for instance – to evaluate the marginal prices of input variables. Therefore, the research first aims to provide a panel of variables useful for predicting real estate values following changes in the quality of the urban environment. Then, a methodology that involves the joint use of MLR and ANN is defined. This is to demonstrate that AI models, when supported by traditional models, can return a broader set of information to valuers and represent a more valid support to decision-making

An economic model of risk assessment for water projects

Abstract The projects that concern water resources are characterized by the multiple risk rates – even extra–financial – that significantly affect their concrete feasibility. Although the risk assessment is decisive for expressing economic convenience judgements on these project initiatives, the decision-maker does not have precise references to determine whether the residual investment risk is acceptable. Thus, the purpose of the paper is to overcome the limit set by characterizing a model for the acceptability of project risk, also considering the plurality of environmental effects that the water projects generate on the community. The idea is to integrate the logic 'As Low As Reasonably Practicable' (ALARP) into the procedural schemes of Cost–Benefit Analysis (CBA). In accordance with this principle, widely applied in high-risk sectors such as those of industrial engineering, a risk is ALARP when the costs to further reduce it are disproportionate to the obtainable benefits. The application of the model to an irrigation reconversion intervention in a Municipality in the Province of Salerno (Italy) shows that the ALARP logic defines a general way of thinking and can contribute to the definition of effective forecasting protocols. In this sense, the proposed methodology becomes a useful support for environmental decision-making. (The paper is to be attributed in equal parts to the three authors.

UNA STIMA PER L’ACCETTABILITÀ DEL RISCHIO D’INVESTIMENTO

Supporting the financial analysis with investment risk assessment is essential when it is not possible to express with certainty forecast judgments on critical project variables. Since both the industry literature and the regulatory landscape do not provide specific criteria to estimate the acceptability of investment risk, we propose an approach that can guide the analyst in assessing the triangular balance between costs, benefits, and risks. It is an approach that aims to integrate the As Low As Reasonably Practicable (ALARP) logic and Capital Asset Pricing Model (CAPM).  The concepts of risk acceptability and tolerability are derived from ALARP. The CAPM is used to estimate the two threshold values, which are a function of both the investment sector and the specific socio-economic conditions in which the project is located. An application shows that a civil project in the Campania Region (Italy) has a tolerable risk as an ALARP if its expected return is between 8.8 and 11.2%

L’ANALISI COSTI-BENEFICI PER PROGETTI IN CAMPO AMBIENTALE. LA SCELTA DEL SAGGIO SOCIALE DI SCONTO

The use of constant Social Discount Rates (SDR) in Cost-Benefit Analyses (CBA) has the effect of the excessive contraction of financial terms that are pro-gressively more distant in time. For this reason, the choice of SDR becomes crucial in the ex-ante evaluations of projects with inter-generational environmental implications, the benefits of which often affect generations different from those who bear the costs. A possible solution to this problem can come from the discounting of environmental components to an “ecological” discount rate less than the “economic” one, the latter useful to evaluate the financial cash flows. With this paper, we intend to define a probabilistic model to estimate the declining function of the two rates, the economic and the ecological, taking into account the correlation between consumption and environmental quality. The estimate conducted for Italy demonstrates the implications that such a model has on the entire environmental decision-making process

SULLA DIPENDENZA DEL PREZZO DEGLI IMMOBILI RESIDENZIALI DAI LIVELLI DI ACCESSIBILITÀ A SERVIZI E INFRASTRUTTURE DI TRASPORTO

Intrinsic characteristics and urban facilities significantly influence residential property prices. However, among the effects of city facilities, those related to accessibility to the urban system services and activities have not yet been sufficiently investigated and their spatial heterogeneity is often overlooked. The aim of the paper is to define a methodology to analyse the impact of accessibility to services and infrastructures on property values. It is a three-step methodology: (i) characterisation of the price function; (ii) verifying the goodness of the model; (iii) autocorrelation analysis and implementation of spatial econometric models. A new element of this research is the construction of a panel of input variables useful for setting the price function. In fact, in addition to intrinsic characteristics and zonal characteristics, local accessibility indicators and systemwide accessibility indicators, usually not included in evaluations, are introduced. In addition, the last step of the model demonstrates the necessity of implementing spatial econometric models in cases where the levels of spatial heterogeneity are not negligible. The implementation of the model to real case studies will allow to quantify the impact of local and systemwide accessibility on residential property values

Severe Asthma Standard-of-Care Background Medication Reduction With Benralizumab: ANDHI in Practice Substudy

Background: The phase IIIb, randomized, parallel-group, placebo-controlled ANDHI double-blind (DB) study extended understanding of the efficacy of benralizumab for patients with severe eosinophilic asthma. Patients from ANDHI DB could join the 56-week ANDHI in Practice (IP) single-arm, open-label extension substudy. Objective: Assess potential for standard-of-care background medication reductions while maintaining asthma control with benralizumab. Methods: Following ANDHI DB completion, eligible adults were enrolled in ANDHI IP. After an 8-week run-in with benralizumab, there were 5 visits to potentially reduce background asthma medications for patients achieving and maintaining protocol-defined asthma control with benralizumab. Main outcome measures for non-oral corticosteroid (OCS)-dependent patients were the proportions with at least 1 background medication reduction (ie, lower inhaled corticosteroid dose, background medication discontinuation) and the number of adapted Global Initiative for Asthma (GINA) step reductions at end of treatment (EOT). Main outcomes for OCS-dependent patients were reductions in daily OCS dosage and proportion achieving OCS dosage of 5 mg or lower at EOT. Results: For non-OCS-dependent patients, 53.3% (n = 208 of 390) achieved at least 1 background medication reduction, increasing to 72.6% (n = 130 of 179) for patients who maintained protocol-defined asthma control at EOT. A total of 41.9% (n = 163 of 389) achieved at least 1 adapted GINA step reduction, increasing to 61.8% (n = 110 of 178) for patients with protocol-defined EOT asthma control. At ANDHI IP baseline, OCS dosages were 5 mg or lower for 40.4% (n = 40 of 99) of OCS-dependent patients. Of OCS-dependent patients, 50.5% (n = 50 of 99) eliminated OCS and 74.7% (n = 74 of 99) achieved dosages of 5 mg or lower at EOT. Conclusions: These findings demonstrate benralizumab's ability to improve asthma control, thereby allowing background medication reduction

Differential cross section measurements for the production of a W boson in association with jets in proton–proton collisions at √s = 7 TeV

Measurements are reported of differential cross sections for the production of a W boson, which decays into a muon and a neutrino, in association with jets, as a function of several variables, including the transverse momenta (pT) and pseudorapidities of the four leading jets, the scalar sum of jet transverse momenta (HT), and the difference in azimuthal angle between the directions of each jet and the muon. The data sample of pp collisions at a centre-of-mass energy of 7 TeV was collected with the CMS detector at the LHC and corresponds to an integrated luminosity of 5.0 fb[superscript −1]. The measured cross sections are compared to predictions from Monte Carlo generators, MadGraph + pythia and sherpa, and to next-to-leading-order calculations from BlackHat + sherpa. The differential cross sections are found to be in agreement with the predictions, apart from the pT distributions of the leading jets at high pT values, the distributions of the HT at high-HT and low jet multiplicity, and the distribution of the difference in azimuthal angle between the leading jet and the muon at low values.United States. Dept. of EnergyNational Science Foundation (U.S.)Alfred P. Sloan Foundatio

Optimasi Portofolio Resiko Menggunakan Model Markowitz MVO Dikaitkan dengan Keterbatasan Manusia dalam Memprediksi Masa Depan dalam Perspektif Al-Qur`an

Risk portfolio on modern finance has become increasingly technical, requiring the use of sophisticated mathematical tools in both research and practice. Since companies cannot insure themselves completely against risk, as human incompetence in predicting the future precisely that written in Al-Quran surah Luqman verse 34, they have to manage it to yield an optimal portfolio. The objective here is to minimize the variance among all portfolios, or alternatively, to maximize expected return among all portfolios that has at least a certain expected return. Furthermore, this study focuses on optimizing risk portfolio so called Markowitz MVO (Mean-Variance Optimization). Some theoretical frameworks for analysis are arithmetic mean, geometric mean, variance, covariance, linear programming, and quadratic programming. Moreover, finding a minimum variance portfolio produces a convex quadratic programming, that is minimizing the objective function ðð¥with constraintsð ð 𥠥 ðandð´ð¥ = ð. The outcome of this research is the solution of optimal risk portofolio in some investments that could be finished smoothly using MATLAB R2007b software together with its graphic analysis