by Gordon C. Rausser and Maya Papineau
- As firms increase their exposure in renewable energy markets, the public sector will be increasingly be pulled in the direction of insuring against the downside risks of clean energy investments. A central question arises in this context: what is the optimal ex-ante allocation of renewable energy R&D investment across the emerging technologies? From the standpoint of societal welfare, the optimal allocation of such support is fundamentally a problem of ex-ante portfolio analysis under risk and uncertainty. This paper presents the components of an ex-ante portfolio analysis of both public and private sector R&D risks in renewable energy.
Rausser, G.C. and M. Papineau (2008). "Managing R&D Risk in Renewable Energy." Department of Agricultural & Resource Economics, UCB. CUDARE Working Paper 1058, Jun 2008.