New approach to energy strategy accounts for uncertainty

EPFL scientists have developed a model that can help policymakers factor in uncertainty when they map out their energy strategies. Today such strategies are based largely on forecasts of fuelprices, technology costs and energy demand. However, these forecasts are often incorrect and can lead to flawed decisions. Many countries - including Switzerland - are developing an energy strategy to meet various objectives such as reducing reliance on fossil fuels, cutting CO₂ emissions and promoting the energy transition. That means governments have to make important decisions about which power sources to prioritize in the future and what technologies to invest in, in order to strike the right balance between keeping public spending under control and promoting clean energy.  These strategic decisions are generally based on forecasts of natural gas prices, solar power costs, electricity demand and hundreds of other parameters. Today, energy planners enter these forecasts into computer models that then identify the "best" strategies. But because these forecasts stretch out some 20-50 years, they are often wrong - meaning the models' output is often wrong, too. And this can lead to bad policy decisions. Gas-fired power plants shut down before ever being put into service "For example, the Netherlands have invested heavily in gas-fired power plants, based on the assumption that the price of natural gas would stay low," says Stefano Moret, a Postdoctoral Researcher at EPFL's  Industrial Process and Energy Systems Engineering Group  and author of the study. "However, their forecasts were mistaken, and many power plants were shut down before ever being put into service."  A new model to consider uncertainty