Building Foresight in Long-Term Infrastructure Planning Using End-Effect Mitigation Models

This paper applies the end-effect mitigation models to build foresight into long-term infrastructure planning problems. This paper describes the phenomenon of end effects; presents four different models that address it, namely extended simulation, salvage value, and primal and dual equilibria; and applies them to long-term energy system planning problems with finite resources for investments. The planning model is a simultaneous multiperiod linear optimization model that plans for energy system infrastructures at the national scale. Two instances of this model are considered: 1) a small-scale five-node model; and 2) a medium-to-large-scale 13-node model. These instances are used to assess and quantify: 1) the end effects of using investment solutions; and 1) the efficacy of each mitigation methods in terms of accuracy and computational time. The illustrations demonstrate that, without attributing the long-term infrastructure planning with some level of foresight about the future cost and performance of the technologies, the resulting portfolio will have end effects in terms of: 1) investment bias toward low-cost resources at the end years; and 2) adopting low-cost quick fixes (such as excess cofiring) to meet near-term emission targets, both of which may render the model to lose sight of long-term targets and economics.