Portfolio Selections for Fossil Demonstration Plant Programs. Report No. 1-703

Portfolio Selections for Fossil Demonstration Plant Programs.
Report No. 1-703 - January 1977

List of Figures				viii
List of Tables				ix
1.	Methodology for Selection of Fossil Energy Processes			1
	1.1	Basic Portfolio Theory		2
	1.2	The Econergy Portfolio Model		6
		1.2.1	Revenues and Costs	6
		1.2.2	Risk Measures	9
		1.2.3	The Unnormalized Benefit/Risk Map	12
		1.2.4	The Normalized Benefit/Risk Map	12
		1.2.5	Risk Attitude and Decision-making	18
		1.2.6	Program Decision Making	21
2.	Data Requirements			24
	2.1	Process Economic Data
	2.2	Plant Capacity and Revenue Calculation		25
	2.3	Economic Assumptions		26
	2.4	Process Risk Data		27
3.	Major Facility Project Management Program Results			30
	3.1	Introduction		30
	3.2	Portfolios of Coal Conversion Processes		32
		3.2.1	Program Structure	32
		3.2.2	Baseline Portfolios	33
		3.2.3	Budget Constraints	36
	3.3	Program Results for Twenty-One Coal Conversion Processes		37
		3.3.1	Baseline Portfolio Results	37
		3.3.2	Baseline Processes	42
		3.3.3	Analysis of Program Results	46
		3.3.4	Baseline Budgets	53
	3.4	Sensitivity of Program Results		57
		3.4.1	Sensitivity to Process Economics and Risk	57
		3.4.2	Sensitivity to Product Market Price	61
		3.4.3	Portfolio Risk and Diversification	64
4.	Summary of Results			67
	4.1	Portfolio Evaluation Criteria		67
	4.2	Portfolio Results		68
	4.3	Sensitivity of Results		73
	4.4	Budget Analysis of Results		76
	4.5	Recommended Processes		79
Bibliography				81
Appendices				82
A		List of Interviews
B		Input Data Requirements for Portfolio Model
C		Data for Twenty-one Coal Conversion Processes
D		Model Calculations
E		Ten Baseline Portfolio Results
F		Individual Process Results
G		Sensitivity Results for Ten Baseline Portfolios
H		APL Program Listings and Data
I		Fortran Program Listings