NDLI: Options for real options: dealing with uncertainty in investment decisions for electricity networks

Content Provider	IEEE Xplore Digital Library
Author	Wijnia, Y.C. Herder, P.M.
Copyright Year	2005
Description	Author affiliation: Risk Manager of Asset Manage., Essent Netwerk, Den Bosch, Netherlands (Wijnia, Y.C.)
Abstract	Part of the liberalization effort in the Netherlands was to regulate the income of the network companies. Although the reduction in income was not as dramatic as in the United Kingdom, it still forced the network companies to review their expenditures. Complicating the challenge was the silent requirement that the cost reduction should not result in more risk. This required a change in the valuation methods. So far these valuation methods have changed from purely technical criteria into a more risk based, net present value alike approach. The real option theory is not commonly used in the decisions. This seems a bit odd, as major uncertainties influence the valuation process. In this paper a few options in which the real option theory might be valuable are presented. It is an invitation to the real option specialists to show the network companies how real options could be of value.
Starting Page	3682
Ending Page	3688
File Size	232835
Page Count	7
File Format	PDF
ISBN	0780392981
DOI	10.1109/ICSMC.2005.1571719
Language	English
Publisher	Institute of Electrical and Electronics Engineers, Inc. (IEEE)
Publisher Date	2005-10-12
Publisher Place	USA
Access Restriction	Subscribed
Rights Holder	Institute of Electrical and Electronics Engineers, Inc. (IEEE)
Subject Keyword	Uncertainty Intelligent networks Investments Asset management Cost accounting Portfolios Energy management Risk management Technology management Regulators Electricity Grid Investment Decision-Making Real Options
Content Type	Text
Resource Type	Article

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1	Ministry of Education (GoI), Department of Higher Education	Sanctioning Authority	https://www.education.gov.in/ict-initiatives
2	Indian Institute of Technology Kharagpur	Host Institute of the Project: The host institute of the project is responsible for providing infrastructure support and hosting the project	https://www.iitkgp.ac.in
3	National Digital Library of India Office, Indian Institute of Technology Kharagpur	The administrative and infrastructural headquarters of the project	Dr. B. Sutradhar bsutra@ndl.gov.in
4	Project PI / Joint PI	Principal Investigator and Joint Principal Investigators of the project	Dr. B. Sutradhar bsutra@ndl.gov.in Prof. Saswat Chakrabarti will be added soon
5	Website/Portal (Helpdesk)	Queries regarding NDLI and its services	support@ndl.gov.in
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7	National Digital Library of India Club (NDLI Club)	Queries related to NDLI Club formation, support, user awareness program, seminar/symposium, collaboration, social media, promotion, and outreach	clubsupport@ndl.gov.in
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9	IDR Setup or Support	Queries related to establishment and support of Institutional Digital Repository (IDR) and IDR workshops	idr@ndl.gov.in

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