This dissertation assesses the prospects for private-sector investment in hydrogen and fuel cell technologies using an innovative application of real options analysis. Specifically, the dissertation considers the decision faced by natural gas utilities over whether, how, and to what extent they should invest in projects that could be of value if a hydrogen energy market develops in the future. This is a problem of investment under uncertainty when there is little prior information available and where the investment itself could affect the future development of this market. The ultimate goal of the dissertation is to identify investment strategies that are robust against alternative futures and assess the trade-offs of various policy instruments.
Table of Contents
Literature Review on Real Options and Investment under Uncertainty
The Role of Public and Private Sectors in Hydrogen Investment
A Case Study of Three Natural Gas Distribution Utilities
Potential Hydrogen Markets and Public Policies
Real Options Model
This document was submitted as a dissertation in September 2006 in partial fulfillment of the requirements of the doctoral degree in public policy analysis at the Pardee RAND Graduate School. The faculty committee that supervised and approved the dissertation consisted of Steven Popper (Chair), Mark Bernstein, and James Dewar.
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