RESEARCH TRIANGLE INSTITUTE
/RTI
Methodology for Integrated
Technology Assessments
Final Report
Prepared for
Robert V. Hendriks
U.S. Environmental Protection Agency
National Risk Management Research Laboratory
Air Pollution Prevention and Control Division
Atmospheric Protection Branch
MD-63
Research Triangle Park, NC 27711
EPA Contract Number 68-D-99-024
RTI Project Number 7647.002.133.200
February 2001
3040 Cornwallis Road • Post Office Box 12194 • Research Triangle Park, North Carolina 27709-2194 USA
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EPA Contract Number RTI Project Number
68-D-99-024 7647.002.133.200
Methodology for Integrated
Technology Assessments
Final Report
February 2001
Prepared for
Robert V. Hendriks
U.S. Environmental Protection Agency
National Risk Management Research Laboratory
Air Pollution Prevention and Control Division
Atmospheric Protection Branch
MD-63
Research Triangle Park, NC 27711
Prepared by
Camille H. Archiblad
David W. Coy
Chung-l Li
Carol A. Mansfield
Joan S. McLean
Keith A. Weitz
Research Triangle Institute
Research Triangle Park, NC 27709
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CONTENTS
Section Page
1 Introduction 1-1
1.1 Why Conduct a Technology Assessment? 1-1
1.2 What Are the Intended Applications of the Technology Assessment
Methodology? 1-3
1.3 Limitations of this Method 1-4
1.4 About this Document 1-5
2 Using the Strategic Technology Assessment Method: Getting Started 2-1
2.1 About the Strategic Technology Assessment Model 2-1
2.1.1 Defining the Technology 2-2
2.1.2 Identifying Key Aspects Through Reviewing and Responding to
Assessment Questions 2-4
2.1.3 Making Decisions and Identifying Research Needs 2-6
3 Specifying the Technology for Consideration 3-1
3.1 Operating Definition of Technology for this Methodology 3-2
3.2 Background on Example Mitigation Technologies 3-3
3.2.1 Fluorescent Lights 3-3
3.2.2 Biofuels 3-4
3.3 Technology Considerations 3-5
3.3.1 Statement of Desired Outcome 3-6
3.3.2 Definition or Identification of the Technology System 3-6
3.3.3 Performance 3-10
3.3.4 Cost 3-11
3.3.5 Development Status 3-13
3.3.6 Introduction Considerations 3-14
3.3.7 Resource Needs 3-14
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3.3.8 Links to Other Technologies/Industries 3-16
3.3.9 Technology Alternatives 3-16
3.3.10 Technological Future 3-17
3.4 Next Methodology Steps 3-17
3.5 References 3-18
4 Environmental Impacts 4-1
4.1 Key Aspects of Technology and the Environmental System 4-3
4.1.1 Media and Types of Impacts 4-3
4.1.2 Dimensions of Impact 4-5
4.1.3 Matrix 4-7
4.2 Conclusion 4-16
4.3 Additional Resources 4-17
5 Economic System 5-1
5.1 Economic Models of Technology Adoption 5-3
5.2 New Technology and the Economic System 5-6
5.2.1 Supply of the New Technology 5-9
5.2.2 Demand for the Technology 5-11
5.3 Worksheet for Economic System Questions with Sample Questions .5-13
5.4 References 5-13
6 Political, Institutional, and Social Considerations in the Adoption and
Penetration of GHG-Reducing Technologies 6-1
6.1 Political Considerations 6-1
6.1.1 Is Adoption of the Technology Likely to Be Affected by the
Current Administration's General Stance Toward the
Environmental Problem the Technology Is Designed to
Address? 6-2
6.1.2 Is this Technology Part of a Country's National Security
Agenda (e.g., Reducing Reliance on Imported Oil)? 6-2
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6.1.3 Is Developing this Technology Part of the Country's Trade
Policy Agenda (More Likely to Be a Long-Term Trade
Policy Goal)? 6-3
6.1.4 Is this Technology of the Macro or Micro Type? 6-3
6.1.5 Who Are the Stakeholders? Consider Disaggregating
Consumers or Receivers of Technology by Income Level, Age
Group, Gender, and Race 6-4
6.1.6 Who Will Be the Main Beneficiary of the Technology:
Consumers, Small Producers, Capital Owners, or Farmers? ... 6-5
6.1.7 How Are Technologies Linked to Changes in Competitive
Advantage for Various Political Groups? 6-6
6.1.8 Is this an Industrialized or a Developing Country? 6-8
6.1.9 Is the Political System Generally Considered to Be Democratic
(Indicator Can Be the Number of Active Political Parties) or
Authoritarian? 6-8
6.2 Institutional Considerations in the Adoption and Penetration of
GHG-Reducing Technologies 6-9
6.2.1 What Are the Formal Institutions Barriers to Adoption/
Diffusion Of the Technologies? 6-10
6.2.2 What Are the Direct and Indirect Influences of Institutions
(Formal and Informal) in Shaping a Technology? 6-11
6.2.3 What Institutional Factors Can Stall a Technology Project? .. 6-12
6.2.4 Some Within-Institutional Barriers, Such as the Lack of a Skill
Base, May Not Impede Adoption as Much as Other Barriers. .6-13
6.2.5 Who Is (Are) the Implementing Body (Bodies) for the
Technology? 6-14
6.2.6 What Does the Decisionmaking Structure Surrounding the
Adoption of the Technology Look Like (Recommend a
Decisionmaking Flow Chart)? 6-15
6.2.7 Does the Implementing Body Have Political Backing for this
Technology? Does it Demonstrate Leadership and Enforcement
Determination? Does it Have Accountability and Managerial
Autonomy? 6-15
6.2.8 What Are the Current Legislatures, Codes, and Standards
Influencing this Technology? What Are the Anticipated
Trends of Current Legislation? 6-16
6.2.9 Who Is (Are) the Financial Institution(s) Involved in
Financing the Technology? 6-17
6.2.10 Are There Any International Treaties, Conventions, and/or
Agreements Influencing this Technology? 6-19
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6.2.11 What Is the Role of the NCOS in this Effort? If More than
One, Do They Differ in Their Stance on this Technology
Effort? If So, How Do They Differ? 6-19
6.3 Social Considerations in the Adoption and Penetration of
Technologies 6-20
6.3.1 What Is the Relationship Between Population
Demographics and Technology? 6-22
6.3.2 What Are the Individual Psychological Factors Influencing
the Adoption Decision of a New Idea or Product? 6-23
6.3.3 Will Interaction Between Individual Psychology and Group
Psychology Help or Hinder Technology Adoption
Implementation (i.e., Use by the Public)? 6-24
6.3.4 Are There Cultures and Norms That Would Influence an
Individual's Willingness to Adopt a New Technology?
Will the Technology Influence Social Norms and Cultures? .. 6-25
6.3.5 Are There Environmental Justice and Equity Issues to Be
Considered and What Do They Imply for the Siting of a
Macro Technology? 6-26
6.3.6 Are There Second-generation Technology Impacts? 6-27
6.4 References 6-27
7 Putting it All Together 7-1
7.1 Nature of Assessment Results 7-1
7.2 Gather Information from All Sections Together 7-3
7.2.1 Summarizing Findings 7-3
7.2.2 Compare Findings 7-5
7.3 Dealing with Uncertainty 7-7
7.3.1 Causes of Uncertainty 7-8
7.3.2 Dealing with Uncertainty in Decision Analysis 7-8
7.3.3 Uncertainty in the Strategic Technology Assessment
Methodology 7-10
7.4 Use of Assessment Tools 7-11
7.4.1 Modeling 7-11
7.4.2 Methods of Assessment 7-13
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7.5 Organizing the Information for Output 7-15
7.6 References •. 7-16
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LIST OF FIGURES
Number Page
2-1 Model's Conceptual Design 2-3
4-1 Environmental Effects of a Technological System 4-2
4-2 Dimensions of Impact 4-6
5-1 Technology Diffusion 5-3
5-2 Technology Production and Diffusion 5-8
7-1 Recommended Steps to Synthesize Information 7-4
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LIST OF TABLES
Number Page
3-1 Key Considerations of the Technology 3-7
4-1 Environmental Media and Types of Impact 4-4
4-2 Characterization of Environmental Impacts 4-8
4-3 Matrix Impact Categories: Biofuels Example 4-12
4-4 Example of Assessment Planning Function of the Environmental Screening
Matrix 4-15
4-5 General Resources for Identifying Environmental Impacts 4-17
4-6 Resources for Human and Ecological Health Effects Data 4-20
5-1 NAICS Sectors 5-2
5-2 Economic System Sample Worksheet 5-14
5-3 Sample Worksheet for Fluorescent Lightbulbs 5-17
5-4 Sample Worksheet for Biofuels (Produced with Corn) 5-21
6-1 Identifying Political, Institutional, and Social Considerations 6-29
7-1 Sample Summary Showing Examples of Results That Might Be
Expected from a Biofuels Assessment 7-6
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SECTION 1
INTRODUCTION
Global climate change is one of the focal environmental issues facing national
governments, industry, and individuals today. Although the United States currently has no
national legislation for regulating the emissions of greenhouse gases (GHGs), decisions are
being made in the federal and private sectors concerning development and employment of
technologies across a broad spectrum of the national economy that will impact GHG
emissions and the ability to adapt to changes in climate.
In the past, most technology assessments have focused primarily on the engineering
specifications, operational functions, and costs of a particular technology. Experience has
shown that many nontechnical effects and influences on technology acceptance also play a
large, if not larger, role in a technology's overall success. Nontechnical considerations may
include political, institutional, and social factors that affect technology adoption and are
affected by its adoption.
The challenges of forecasting possible future outcomes of technologies,
environmental consequences, political and institutional barriers and incentives, and
unpredictable human factors (such as public perception) make technology assessment a
difficult and multidisciplinary task. Research Triangle Institute (RTI) worked with the U.S.
Environmental Protection Agency's (EPA's) Atmospheric Protection Branch to develop a
standard strategic technology assessment methodology for identifying the opportunities for
and consequences of implementing alternative global climate change mitigation and
adaptation technologies. This methodology is presented in this report along with worksheets
to assist assessors in compiling and organizing information about the technology being
evaluated and their findings.
1.1 Why Conduct a Technology Assessment?
Technology plays an integral role in our lives. Changes in technology therefore have
direct impacts on people's lives, but also have farther reaching impacts on the world around
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• us. The world can be viewed as a series of interconnected systems, including economic
systems, ecological systems, political and institutional systems, and human systems (cultures,
social conditions). These systems are continuously interacting and in flux. Changes in any
one system can create changes in another. Well-intentioned technologies that create changes
to one system have consequences, sometimes negative and often unanticipated, to other
systems. The goal of this technology assessment methodology is to better understand the
roles of national and global systems and how they affect or are affected by technology and to
help identify key factors that can lead to the success or failure of technologies. These key
factors include a very large number of performance, cost, technical, and nontechnical
(political, institutional, and social) aspects.
The technology assessment methodology presented in this document will help the
assessor to:
• understand key issues about proposed technology options;
• determine where a technology is headed and understand the factors that can
encourage or hinder its evolution;
• compare competing technology alternatives;
• identify potential opportunities and anticipated and possible unanticipated areas of
risk for proposed technologies; and
• identify key aspects of technologies that require further investigation.
In short, this methodology will help assessors better understand the roles of
technologies in economic, environmental, institutional, political, and social systems and
better understand the key questions and issues to ask about proposed technologies. For
example, biofuel technology currently exists in the United States at small scales. Introducing
a major national policy shift towards the use of biofuels in the United States would, among
other possible changes, create economic benefits for the agricultural industry and economic
costs to the petroleum industry resulting from decreased demand for gasoline and to the
automobile industry to produce biofuel-compatible engines. From a social standpoint, there
may be widespread support and acceptance of biofuels as an equal substitute for gasoline. On
the other hand, consumers might be reluctant to switch to biofuels because of real or
perceived negative effects on car performance. Thus, although biofuels may provide a
positive benefit in terms of GHG emissions reduction, the lack of public acceptance may
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hinder the technology's acceptance and use at meaningful levels. This type of information
can only be identified and evaluated if the right questions are asked in the technology
assessment process. This is the goal of this methodology.
As another example, solar cells have been available for decades in the United States,
yet they have failed to gain widespread acceptance and adoption as an alternative to fossil-
fuel produced electricity. What have been the critical barriers to the acceptance and adoption
of solar cells? Inadequate performance? High cost? Political power and influence of the oil
industry? Negative aesthetic appeal of solar panels on roofs, etc.? Market, political, and
social institutions and consumer purchasing behaviors all affect the market penetration and
ultimate usefulness of technologies and their impact on the environment. The strategic
technology assessment method is designed to help identify and evaluate key technical (e.g.,
cost, performance) and nontechnical (e.g., public perception, institutional barriers) aspects
that lead to successful technology selection.
1.2 What are the Intended Applications of the Technology Assessment
Methodology?
Although the methodology is general and may have many different applications, it has
the major objective of helping the assessor understand the factors that influence whether a
technology will be adopted and what impact it may have once it is adopted. This
methodology is most likely to be applied in two primary applications:
• to screen competing research projects for determining which technologies should
be assessed in further detail and
• to assess individual (or groups of) technologies to provide a broader picture for
policy analysts, government officials, and technology assessors of interactions that
may affect the adoption, effectiveness, and secondary impacts of technologies.
Regardless of its application, the strategic technology assessment method as presented
in this document represents a first step in the complete evaluation of any technology. Results
of conducting the assessment are intended to guide a decision regarding the technology in
question. The results of the assessment are not intended to be fully comprehensive. It is
intended to help assessors identify areas that require further investigation and guide them on
the types of more detailed assessments that are needed to fully understand a technology's
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likely impacts. As needed, additional detailed assessments will complement the results of the
technology assessment methodology.
In attempting to assess the impacts of climate change, some assumptions about
technology need to be made. It would be incorrect to assume that technologies will remain
static over the next several decades. In particular, many new energy-producing and energy-
using technologies are under development or beginning to penetrate the market. Therefore, it
is important to assess these technologies and determine which are likely to be adopted and
their potential environmental, economic, and social effects.
Although prior technology assessments at EPA have focused primarily on the
engineering specifications, operational functions, and costs of a particular technology, EPA
staff recognize the need to define the context within which the technology operates, identify
nontechnical influences on technology acceptance, evaluate the environmental and economic
impacts, compare alternative options, rank conditions within the context of and across
options, and develop conclusions about barriers and opportunities.
1.3 Limitations of this Method
Identifying and evaluating all of the possible outcomes of any technology are
impossible tasks. The method developed and described in this document does not attempt to
conduct a comprehensive analysis of technologies or to reach conclusions about their success.
Rather it is designed as a guidebook to assist in understanding technical and nontechnical
factors and issues that technologies influence..
Additional limitations of the strategic technology assessment method include the
following:
• It covers a subset of all potential factors that affect technology penetration and
potential areas where unanticipated consequences of technology may occur.
• Technologies are in different stages of development, from concepts to full-fledged
pilots; thus, the amount and type of information available for any given
technology vary widely and affect the level of assessment that can be done.
• The method focuses specifically on technologies that will have an impact on
climate change and adaption to climate change; thus, key aspects of the method
may not be applicable for assessing other types of technologies.
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1.4 About this Document
This document is designed to be a learning tool and guide as opposed to a strict
methodology that should be followed. Section 2 provides an overview of the strategic
technology assessment method and guidance on how to work through the method.
Discussion of the strategic technology assessment method starts in Section 3 with defining
the technology(ies) under study. This is a critical step in the assessment process because it
sets the stage for gathering key pieces of information about the technology that will be useful
in responding to the key assessment aspects in the next steps of the method.
Sections 4 through 6 are the heart of the assessment method and contain background
discussion, key concepts and terms, key aspects to consider as part of technology assessment,
and tools and resources for obtaining further information or detail about the technology and
its impacts. Section 4 focuses on integrating life-cycle environmental considerations into the
assessment. Section 5 presents the economic system and its role in technology development,
implementation, and market penetration for different sectors (industry, consumers) and also
discusses potential economic system impacts that may result from technology adoption.
Section 6 includes discussions of political, institutional, and social aspects of technology
development, implementation, and ultimate market success. This section focuses primarily
on the nontechnical, but critically important, aspects of technology.
Section 7 provides a suggested approach for compiling and evaluating the data and
information developed by working through Sections 3 through 6 and using that information
to determine and/or identify areas requiring more detailed analysis.
As part of Sections 3 through 6, worksheets are provided to assist in collecting and
organizing information gathered or developed through the assessment process. In addition,
examples have been provided to aid in understanding the assessment method.
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SECTION 2
USING THE STRATEGIC TECHNOLOGY ASSESSMENT METHOD:
GETTING STARTED
The strategic technology assessment methodology provides a consistent approach for
assessing the opportunities for and consequences of implementing alternative global climate
change mitigation and adaptation technologies. The core of the methodology is a model
designed for use as a preliminary assessment of climate change technologies to identify key
areas for further research for multiple assessment categories. The model includes five
assessment categories:
• economic
• environmental .
• institutional
• political
• social
This model does not provide the details of a specific technology but rather it helps assessors
get a more complete picture of a technology's implementation opportunities and
consequences and identifies areas that require further investigation. As the assessment is
completed, assessors will systematically assemble relevant information on the technology and
its alternatives from an interdisciplinary perspective to enable a meaningful and thorough
evaluation of the technology options in a realistic context.
2.1 About the Strategic Technology Assessment Model
The model consists of three main components or steps:
1. Defining the technology(ies) under consideration (Section 3)
• level of technology diffusion
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2. Identifying key aspects of the technology:
• environmental (Section 4)
• economic (Section 5)
• institutional, political, and social (Section 6)
3. Putting information together to make decisions and identify areas where more
detailed analysis or additional information is needed (Section 7)
Figure 2-1 illustrates the model's conceptual design. Technologies are first defined
and evaluated for how likely, and at what level, the technology will be adopted (i.e., what is
the potential market for the technology?). The level of market penetration will influence the
technology's predicted impacts on social, economic, and environmental systems. The intent,
design, and approach recommended for completing each of these steps are described in
greater detail in the following sections.
2.1.1 Defining the Technology
The goal of the first step is to collect and compile information about the technology
under evaluation so that it can be clearly defined. As part of defining the technology, the
assessor should collect basic information about it, such as
• development status,
• environmental performance (not just GHG reductions),
• cost,
• technology displacements, and
• scale or market potential and/or limitations.
The outcome of this activity should be a more thorough understanding of the
technology. This information will be a helpful lead into the assessment questions discussed
in Sections 4 through 6 and will need to be revisited when addressing the questions.
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Existing
Conditions
New Technology
Potential Penetration
Penetration = f(cost,
retrofit, institutional
barriers/drivers,
legislative factors, etc.)
Results, Given the
Predicted Level of
Penetration
Figure 2-1. Model's Conceptual Design
A—> Economic Results
\
\
\
—\— Environmental Results
-V- Social Results
•>> Market Results
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2.1.1.1 Technology Diffusion
An important aspect of assessing the potential impacts of a technology is defining the
level of technology diffusion, or market penetration, that the technology is expected to meet.
For example, is the technology being developed and promoted as a total replacement for an
existing technology (e.g., biofuels expected to replace 100 percent of the gasoline market) or
is the technology a partial replacement for an existing technology (e.g., biofuels expected to
replace 25 percent of the gasoline market). Typically, a technology assessor will not know in
advance what that level of diffusion is likely to be, and many of the issues raised during the
technology assessment itself provide insight on whether diffusion is likely to be low or high.
Defining the level of technology diffusion is an iterative process. Some options for defining
expected technology diffusion levels are as follows:
• Use best estimates to define an initial level of diffusion. That level would be
revisited throughout the assessment as more is learned about the technology and
the potential barriers and supporters of its diffusion, as well as the potential
impacts of its diffusion.
• Conduct a cursory, screening-level pre-evaluation to identify which criteria will
be most sensitive to technology diffusion levels (e.g., human health impacts,
revenue changes to industry, or change in prices of raw materials). The assumed
diffusion level could be varied to investigate incremental impacts or to identify
threshold impacts related to those most sensitive criteria.
• Define and evaluate an anticipated level (or varying levels) of technology
diffusion for new technologies or technologies for which no market currently
exists. The evaluator would investigate the impacts of this technology at, for
instance, 25 percent diffusion, 50 percent diffusion, and 75 percent diffusion.
2.7.2 Identifying Key Aspects through Reviewing and Responding to Assessment
Questions
The goal of the questions and analysis methods in Sections 4 through 6 (economic,
environmental, institutional/political/social) is to provide a manageable set of questions or
criteria that would enable the assessor to identify critical aspects of the technology that
should be considered and resources to help in responding to the questions or criteria. The
questions and criteria are designed to be broad to capture a wide range of aspects. They serve
as a screen to help identify key issues and provide guides to resources to help address those
issues. For example, in evaluating environmental performance, a certain technology may
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reduce GHG emissions, but it releases a toxic pollutant that presents a threat to groundwater.
Detailed health risk assessment or groundwater modeling is outside the scope of this
assessment model, but several sources of additional impact assessment tools are provided if
the assessor chooses to conduct more quantitative analysis. The objective of the strategic
technology assessment method, in this case, is to identify groundwater quality and human
health effects as potential issues. For some technologies, available descriptions and data may
make it possible to quantify the impact (e.g., an estimated contamination rate or a human
exposure concentration). In other cases, the assessor will only have enough information to
make a qualitative statement that particular types of impacts are of concern and to note that
monitoring or other quantitative analysis is needed.
Each of the topic sections is structured similarly to facilitate the assessment:
• Define the topic area, its boundaries, and key terms.
• List the key aspects of the topic area to be considered as part of the technology
assessment.
• Provide information about key resources that can be used to conduct a more
detailed analysis for a certain area.
The main part of the sections is the key aspects to be considered. The key aspects are
used to conduct a comprehensive "screening" of the technology against defined criteria. The
key aspects are in slightly different formats across the topic areas because the aspects are
presented in a manner that makes the most sense for each topic. For example, potential
environmental impacts are presented in a matrix organized by environmental medium. The
section describes recommended approaches for using the matrix to identify and prioritize key
environmental issues associated with a particular technology. The goal of the matrix is to
ensure consideration of all potential impacts, including near-term and long-range, direct and
cumulative, and local/regional and national impacts. For institutional considerations, in
contrast, the key aspects are presented in the form of questions for the assessor to consider.
Note that all of the key aspects included for each topic area may not be applicable for
every technology. In addition, because different technologies are in different stages of
development—from conceptual model to full-fledged products—data and information
available for different technologies will likely vary widely. If faced with limited information
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about a particular technology, we recommend using the available information and forecasting
or using proxy information from similar technologies to fill in the gaps.
The outcome of this step should be a broad understanding and identification of
potential issues related to the technology under evaluation for each of the topic areas. The
next section discusses the final step in this assessment methodology: how to put all of this
information together to aid in making decisions and identifying additional research or
informational needs.
2.1.3 Making Decisions and Identifying Research Needs
The last step is to put together all the information and conclusions from each section.
Major steps here include the following:
• List the assumptions on which the conclusions for each section were drawn. Are
they consistent across sections? Can key assumptions that will have the greatest
effect on the diffusion of the technology and impact of the technology be
identified? How sensitive are the conclusions to the key assumptions?
• Identify inconsistencies across sections. Do any of the conclusions need to be
analyzed again in light of results from other sections?
• Evaluate the assumed rate of technology adoption. Is it reasonable?
• List areas where additional information or research is needed to make
conclusions. What critical aspects did the assessment miss due to a lack of
information?
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SECTION 3
SPECIFYING THE TECHNOLOGY FOR CONSIDERATION
This section describes how to define the technology in sufficient detail to perform the
assessment. The objective of this portion of the methodology is to define and understand all
the component parts of the technology—its expected performance and factors that affect
performance, the cost to produce and operate it, changes in infrastructure needed to support
it, its concomitant benefits, competing technologies—and to identify technological
innovations that could influence its adoption.
Assessments can be conducted at different levels depending on the assessors' needs.
For example, a screening-level assessment can be conducted with less detail than an in-depth
assessment. A screening-level assessment may be all that is possible with a technology that
exists only in conceptual form because the information needed to do a more in-depth
examination does not exist. Differences in the level of assessment would not reduce the
breadth of considerations (i.e., the same topic areas would be included in a screening-level
assessment as in an inrdepth assessment). However, the depth to which the assessor probes
each area would differ between these two cases. As a result, defining the technology for the
two extremes requires the same broad thinking to elaborate on needs and potential impacts of
adopting the technology. The quality of effort spent in defining the technology will have a
major bearing on the practical value of the resulting assessment, but time and resource
constraints may be overriding factors.
The methodology discussed here is more suited to a screening-type assessment, but it
also identifies the basic elements needed to conduct an in-depth assessment. In addition to
identifying potential impacts from the defined attributes, the methodology will make clear
who'the stakeholder groups are. For in-depth assessments, these stakeholders should be
included in the technology assessment process, for they will have a major role in shaping the
technology's fate and must live with the consequences (Westrum, 1991).
This section provides an overview of technology considerations along with relevant
definitions, identification of the key considerations in establishing a sufficient definition for
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assessment purposes, and a brief discussion of the next steps in the methodology. Key
considerations in defining the technology are organized into a tabular-style presentation that
can be filled in and expanded as the definition process progresses. As the assessor's thinking
evolves during the assessment process, the definition table provides the opportunity to
append additional attributes of the technology or items for which impacts should be
considered.
Each section of this document presents brief examples of the methodology's
application. Two technologies—fluorescent lights and biofuels—are used throughout the
document to illustrate how the strategic technology assessment method works. However, not
all the points to be made can be illustrated with these two technologies. For this reason
hybrid, biofuel vehicles, and other technologies are also used in some instances. This section
of the document discusses the defining attributes of the selected technologies.
3.1 Operating Definition of Technology for this Methodology
Technology can be broadly defined as ideas and techniques for manipulating or
modifying our surroundings. For purposes of this methodology, technology is defined more
narrowly as tools and systems people create to alter their lifestyle or surroundings. This
narrower definition of technology excludes ideas; however, some elements of this assessment
methodology may be equally applicable to ideas.
To perform a strategic assessment, the technology should be defined from a system
perspective. All the components needed to construct, operate, support, maintain, and dispose
of the technology should be included in the assessment. One of the topics below focuses on
the issue of boundaries, sometimes referred to as scope, in defining the technology. Putting a
box around the technology system helps the assessor and future assessors determine what is
included and what is not. It aids others in understanding the limitations or caveats that
should be associated with conclusions drawn from the assessment. Further, if the goal of the
assessment process is to compare competing technologies, it is essential to have the
boundaries for each technology defined at equivalent points.
Mitigation technology systems may range from new applications of existing
technologies that can be well defined to the untried that exist only on paper or as a concept.
As mentioned above, the depth of assessment will be limited for the latter cases. The systems
assessed may also range from the relatively simple, such as an add-on industrial process heat
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recovery device, to the complex, such as a new transportation system that requires a whole
new infrastructure to support it and displacement of the existing system and supporting
infrastructure. In each of these cases, the technology system definition is critical to the
quality of the resulting assessment.
3.2 Background on Example Mitigation Technologies
As noted above, each section of this document illustrates the methodology using two
technologies—fluorescent lights and biofuels. Fluorescent lights were selected because they
represent a relatively mature and simple technology that can be discussed in retrospect. They
were introduced in the late 1930s and have accounted for more sales than incandescent bulbs
since the early 1950s (The World Book Encyclopedia, 1980). Biofuels, although produced
and used to a limited extent, represent a mitigation technology that many believe could be
developed to replace a substantial amount of fossil fuel usage. Biofuels also represent a
much more complex example in that their production would involve significant new
agricultural operations, chemical/physical processing, waste and residual handling, and
displacement of fossil-fuel production infrastructure, to mention a few aspects.
The examples provided in this section to illustrate each of the considerations tend to
focus on obvious aspects of the example mitigation technologies. The intent is to trigger a
thought process that would lead the assessor to carefully examine details of the proposed
technology. From that examination, a comprehensive list of characteristics, attributes, and
properties of the technology would be generated in tabular form, and each subsequently
explored by proceeding to the following sections of the methodology.
3.2.1 Fluorescent Lights
In terms of climate change mitigation, fluorescent lights offer the apparent benefit of
significantly reduced energy consumption (75 percent reduction is a typical value) compared
to incandescent lights for a given level of luminous flux. Fluorescent lights are glass tubes
containing argon (or other inert gas) and a droplet of mercury. The electrodes are tungsten
filaments. When an electric discharge via the filaments occurs in the argon-mercury mixture,
ultraviolet light is emitted that is not visible to the eye. The glass tubes are coated internally
with a thin layer of phosphor that emits visible light when illuminated by the ultraviolet light.
Another major component of fluorescent light systems is the ballast. Ballasts are the means
by which energy to the electrodes is regulated; the correct voltage is applied to start the arc,
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and the current is limited to the proper value. Early ballast designs were magnetic and used a
core of steel laminations surrounded by copper or aluminum coils. In recent years, electronic
k
ballasts, high frequency solid-state devices, have come into use. These provide improved
energy efficiency by operating at much higher frequencies than the magnetic type that operate
at line frequency. For popular lamps, the increase in efficiency is about 10 percent (Certified
Ballast Manufacturers Primer, 2000).
In addition to the energy benefits, newer designs of fluorescent lights are achieving
much longer lives than conventional incandescent bulbs. Although the benefits mentioned
here are significant, the assessment methodology leads the assessor to consider many other
aspects associated with the bulbs' production, use, and disposal. As with any technology,
negative issues need to be examined as well. One of the most obvious questions based on the
description above is environmentally safe disposal of all the used bulbs that contain mercury.
At the time fluorescent lights were developed and introduced for use, this issue was probably
not significant.
3.2.2 Biofuels
Biofuels are any type of liquid or gaseous fuel that can be produced from biomass
substrates and used as a substitute for fossil fuels (Giampietro et al., 1997). Unrelated to
global climate change issues, the Arab oil embargo of the 1970s and resulting gasoline
shortages generated a strong incentive to reduce dependence on foreign oil supplies. Efforts
to produce fuel mixtures suitable for current gasoline automobile engines led to production of
ethyl alcohol from com crops. Ethanol can be produced by yeast- or bacteria-mediated
fermentation of sugar and starchy crops, among other methods (Giampietro et al., 1997).
Methanol can be produced from woody crops by means of wood gasification followed by
compression and methanol synthesis (Ellington et al., 1993). These biofuels are mixed with
gasoline by some producers, thus reducing the total amount of gasoline needed from refined
petroleum.
The apparent climate change benefit from the use of biofuels derives from
replacement of fossil-fuel sources, particularly petroleum, by leaving the fossil carbon
deposited in the earth in organic compounds instead of releasing it to the atmosphere through
combustion. Biofuels are derived from crops that take carbon dioxide that is already present
in the atmosphere to be used by the photosynthesis process while growing. The resulting
products of photosynthesis are sugars and other organic compounds as the plant grows. In
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essence the carbon is continuously recycled when the plant matter is converted to a useful
fuel and burned. Whether there could be a significant net climate change benefit by
substitution of biofuel for fossil fuel depends on the scale of substitution attempted. Some of
the important issues are
• the availability of arable land on which to grow the crop that yields sufficient
biomass for the proposed substitution,
• competition for land between food production use and biofuel production use,
• economic and environmentally safe management of residues from crops and the
biofuel processing steps,
• maintenance of land productivity,
• effect of increased agricultural activity on forest and soil carbon storage,
• the need for increased agricultural labor,
• energy consumed in the entire cycle to produce biofuels as compared to that
consumed to produce gasoline or other fossil fuels displaced, and
• the costs of displacement and/or conversion of existing industry and labor
capacity used in the production of fossil fuels (Giampietro et al., 1997).
Identification of these and other issues after defining the technology is the goal of the
assessment methodology.
3.3 Technology Considerations
Defining the desired outcome from applying the mitigation technology and defining
the system, its component parts, and its boundaries are the critical first steps in this part of the
assessment methodology. These provide the proposed scope of application, a basis for
development of a list of materials required, and technical needs to achieve the scope of
application. Traditional engineering assessments proceed from this first step to examine the
issues of expected performance and costs to build, operate, and maintain. The methodology
presented here takes a more comprehensive approach.
Thorough assessments of new technologies or new applications of existing
technology involve projections into the future and comparisons of that future with the future
based on existing technology. To accomplish this, the technology definition process must
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also identify what it is that the assessed technology will replace to allow investigation of the
potential consequences. Further, a complete definition of the technology in this section is
essential because the details ultimately dictate how inclusive the investigations of specific
environmental, economic, institutional, human, and social consequences of adoption can be.
Table 3-1 aids the assessor in establishing a sufficient technology definition by listing
important technology considerations. In applying the defined methodology, Table 3-1 is
intended to be used as a worksheet.
The following sections offer a general discussion of each of the categories of major
considerations and specific discussions of the characteristics, properties, or attributes that fall
within the major categories. The discussions include examples of applications to the two
mitigation technologies selected for illustration—fluorescent lights and biofuels.
3.3.1 Statement of Desired Outcome
The first step in the methodology is stating the desired outcome from applying the
technology. The statement must go beyond the obvious fact of reducing GHG emissions to
include consideration of the scope of application (e.g., replace all incandescent lights with
fluorescent lights, require all gasoline sold in the United States to be mixtures with biofuels
[allowing current automobile and truck engine design to be retained], or require all
automobile and truck fuels sold in the United States to be biofuels [replacing gasoline and
diesel fuels entirely, thus requiring redesign of engines]). The resulting assessment will
identify potential impacts and could show that the desired outcome is achievable, not
achievable, achievable with dire consequences, or achievable at a reduced scope.
If upon completion of the assessment the assessor concludes that use of the
technology is achievable only at a reduced scope, revision of the initially declared desired
outcome may be necessary. For this reason the statement of desired outcome is viewed as a
potentially iterative process. With the revision to desired outcome, some elements of the
assessment may need to be revisited.
3.3.2 Definition or Identification of the Technology System
The first grouping of technology considerations deals with defining the technology
system and identifying its component parts. The assessor determines what elements are part
of the system and, just as importantly, what elements are not included for purposes of the
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Table 3-1. Key Considerations of the Technology
Consideration
Desired outcome of
applying technology
Definition or
identification
Performance
Cost
Development status
Introduction
considerations
Resource needs
Links to other
technologies/
industries
Technology
alternatives
Technological
future
Characteristic
Boundary(ies) of the technology
Associated technical requirements
Scale limitations
Replaces or modifies what
Operational efficiency
Temporal limitations
Spatial limitations
Performance life
Associated safety
Cost to produce — critical cost component(s)
Cost to operate — energy, utilities, special
requirements
Cost to maintain — component life, downtime
Technology implementability — conceptual or
developed and if so at what scale
Hindrances to full use
Infrastructure needed to support
Life of existing infrastructure
Investment needs
Materials
Production processes
Disposal
Impact on other GHG sources
Co-control benefits
Ancillary benefits
Competing technologies
Alternative resource uses
Innovations that could influence adoption
Notes
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assessment. The parts of this group of considerations are discussed in more detail below with
examples provided.
3.3.2.1 Boundary(ies) of the Technology
Identifying boundaries is important to the assessment process because many
assessments compare a "new" (i.e., new application of an existing technology or an entirely
new technology) technology to be implemented at some future time with a future time in
which existing technology continues to be used as it might evolve without some intervention.
Boundaries can be defined as physical boundaries (i.e., what are the component parts
of the technology system). In the case of fluorescent lights, it could be the bulb, internal or
external ballast, and lighting fixtures. Newer fluorescent bulbs designed to replace
incandescent bulbs in household lamps fit in the same lighting fixtures and have internal
electronic ballasts. In an industrial application, the light fixtures may be specifically designed
for fluorescent bulbs with external ballasts applied to systems comprising multiple bulbs. In
the case of home use, the "system" boundary for the newer fluorescent lights could be the
light bulb itself. For the industrial situation, the system boundary would likely include bulbs,
fixtures, ballasts, and any special switches that might be different from those required with
incandescent lighting.
Boundaries can also be defined in terms of function. Biofuels are an energy source
and require devices of specific kinds to enable their conversion to usable energy. Included
within biofuels' boundaries are the various types of devices in which one intends to replace
some other fuel with biofuel. Biofuels cannot be used in conventional automobile engines as
a total replacement for gasoline, so a specially designed engine and its component parts that
could run on 100 percent biofuels would fall within the functional boundary for a biofuel
system for automobiles. A biofuel mixture containing gasoline that falls within the capability
of current automobile engines has a different functional boundary than the 100 percent
biofuel case.
The boundary consideration for biofuels is much more complex than the fluorescent
light consideration. Biofuels are likely to be produced from agricultural or sylvaculture
sources. These crops must be processed to recover the fuel value. Both the growing and
processing would generate demands for land and processing facilities and generate new waste
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materials to handle and process, all of which would fall within the boundaries of the biofuel
system.
3.3.2.2 Associated Technical Requirements
These are the special new technical needs associated with adopting the mitigation
technology. In a biofuel case where the goal is to be able to use vehicles fueled 100 percent
with ethanol or methanol, for example, a new engine design is an associated technical
requirement. Other researchers who have studied the feasibility of large-scale biofuel
production have identified processing of stillage wastes from ethanol production as a major
problem, perhaps pointing to a need for a new process design to promote feasibility
(Giampietro et al., 1997).
3.3.2.3 Scale Limitations
Scale limitation refers to the physical dimensions of the available space into which
the mitigation technology must be placed. Fluorescent lights for home use in conventional
incandescent lamp or ceiling fixtures had to be designed to produce an equivalent amount of
light and fit within the space vacated by the incandescent bulb. The result is that some
fluorescent bulbs, based on external appearances, look like incandescent bulbs.
Another view of scale limitations could refer to practical limits on implementation of
a technology. In this methodology document, these issues are addressed in Section 3.2.7.
3.3.2.4 Replaces or Modifies What?
In this section, the user identifies the existing technology that would be replaced by
the new technology. The question is important in two respects. One, the user needs to
confirm that the new technology supplies all the essential capabilities of the technology being
replaced. Two, the user needs to identify potential impacts of discontinuing the use of the
existing technology. Discontinuing the use of incandescent bulbs in favor of increasing the
use of fluorescent lights affects factories and employment engaged in producing incandescent
lights and supporting products and services. Perhaps existing factories and workers can be
converted to produce the new technology, or perhaps there will be displacements. If biofuels
ethanol and methanol replaced gasoline, there could be substantial displacements in the oil
producing, shipping, and refining industrial sectors. The assessment explores these economic
and social impacts; they are discussed in detail in Sections 5 and 6.
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3.3.3 Performance
Performance is a measure of how well the new technology functions in achieving its
technical purpose. This may be measured in terms of energy efficiency, conversion
efficiency in terms of raw material usage or other process inputs, process stability and service
life, and safety issues.
3.3.3.1 Operational Efficiency
Generally the performance of new technology as related to existing technology it may
replace is the first thing proponents of the new technology evaluate and subsequently
emphasize. Reduced energy consumption, for example, is the main benefit associated with
the switch from incandescent lighting systems to fluorescent lighting systems. Within the
category of fluorescent lighting systems, some options can affect how large a reduction is
achieved as compared to incandescent systems. One option is electronic ballasts that operate
more efficiently, generating less wasted heat, than magnetic ballasts. For this example, the
boundary of the fluorescent light technology must be defined to include ballasts, and the
assessor must specify the type of ballast to be used. Small differences in energy efficiency in
lighting systems may be magnified when extrapolating potential impacts to a national scale.
The energy efficiency of the technology is important even for those new technologies
that mitigate GHG emissions by principal means other than reduced energy consumption.
For instance the mitigation benefits achieved by substituting non-CFC refrigerants for those
currently in use may be partially offset by the accompanying conversion to a new refrigerant
process cycle and the required equipment. Although the energy efficiency comparison
between the new technology and the existing technology may not be favorable, it is but one
element to be weighed in the overall assessment.
Conversion efficiencies of processes may be important in comparing technologies that
consume precious or highly valued resources. This may be reflected in the economic portion
of the assessment, or it simply make a new technology nonviable because of insufficient
supply of that resource at any price.
3.3.3.2 Temporal and Spacial Limitations
Desired performance of mitigation technologies may be limited to certain regions of
the United States or world and limited in time. Technology performance may deteriorate
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with time, thus requiring rejuvenation of critical portions of the process equipment or
resources. A simple example is the need to replace magnetic ballasts in fluorescent lighting
systems periodically to keep them functioning at the same level of illumination as when
originally installed. Technologies that depend on the use of catalysts to drive processes
require periodic replenishment of the catalyst or face declining efficiency and perhaps
complete process failure.
An example of spatial limitation would be the difference in heat pump energy
efficiency when placed in different climates. Heat pumps function most efficiently in
climates that do not include prolonged periods of temperature extremes. Heat pumps do not
function as efficiently for space heating in northern climates with prolonged cold spells
where electrical resistance heating must be used to supplement the heat pump output.
3.3.3.3 Performance Life
This is the expected life of the mitigation technology (performing at the desired net
GHG mitigation level). In the case of fluorescent lights, what is the expected lifetime of the
fluorescent bulb and how does it compare to that of an incandescent bulb it would replace?
Performance life in turn affects the economics of production and disposal (as well as
environmental impacts) of materials used in the mitigation technology.
3.3.3.4 Associated Safety Issues
In the fluorescent light case, this consideration asks whether fluorescent bulbs are
more or less safe than the incandescent lights they replace. For biofuels in automobiles and
trucks, are the vehicles more or less safe in crashes, or if a spill occurs is there a greater or
less risk of a fire or explosion? A further question could address the relative safety in
manufacturing processes associated with the new technology.
3.3.4 Cost
Engineering costs are part of traditional assessments for comparison purposes.
Whether the costs are adequately explored depends on how well the technology has been
defined in the steps above. The subcategories below include the traditionally investigated
areas. These subcategories are major inputs to an economic assessment of the technology.
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3.3.4.1 Cost to Produce—Critical Cost Components
The major components of a technology system, and particularly those likely to have a
significant influence on overall costs, are identified for assessment purposes. Special efforts
must be made to identify any components that contain, or are made from, exotic materials
because of their potential significance to total cost. In the biofuel case, the direct costs of
equipment to process the biomass and recover ethanol or methanol and equipment to process
the waste stillage would be major components. In the situation of total substitution of
biofuels for gasoline, the costs to design and develop engines capable of running on 100
percent biofuels would be a cost of implementing the technology.
3.3.4.2 Cost to Operate—Energy, Utilities, Special Requirements
These are the costs such as water required in biomass processing, steam for
distillation, wastewater treatment, and waste disposal or destruction. However, the overall
costs of implementing the technology could go well beyond the operation of a plant and
process equipment. In a scenario in which biofuels are intended to replace all gasoline,
significant increases in agricultural or sylvacultural productivity would be required. The
costs associated with replenishing land nutrients through fertilization would be a special
recurring requirement associated with this technology (Giampietro et al., 1997).
3.3.4.3 Cost to Maintain—Component Life, Downtime
In the fluorescent light example, the cost of replacing bulbs and ballasts periodically
would fall in this subcategory and be compared to replacement of incandescent bulbs or other
type of lighting. For biofuels, periodic maintenance/replacement of fermentation and still
equipment would contribute to these costs. A thorough assessment would consider the need
for spare capacity as dictated by maintenance cycles.
3.3.4.4 Cost to Manage Waste
Disposal costs may include the costs associated to manage the technology after its
useful life or to manage by-products of technology production, use, and maintenance. It may
include costs associated with recycling, composting/combustion, or landfills. In the biofuel
case, waste stillage would be a major waste stream of the ethanol or methanol production
process. What are the options for managing this waste stream and what is the associated
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cost? The costs associated with waste management could be a significant recurring cost
associated with a technology system.
3.3.5 Development Status
This consideration addresses how close the technology is to being ready for
implementation and what factors might hinder full implementation.
3.3.5.1 Technology Implementability
Fluorescent lighting is a fully developed technology, although further improvements,
particularly with electronic ballasts to enhance energy saving potential, continue to be made.
The technology has demonstrated a clear energy advantage over incandescent lighting
systems. Biofuels have been demonstrated to be feasible partial substitutes for gasoline in
that gasoline-ethanol mixtures are already being sold. Other technologies that exist only as
concepts, or demonstrated at bench scale, have significantly farther to go in determining
whether full-scale application is feasible. The time associated with the additional
development and testing needed could be either an advantage or disadvantage compared to
competing technologies.
3.3.5.2 Hindrances to Full Use
What prevents fluorescent lights from entirely replacing incandescent lights?
Reasons could be personal preferences or institutional or cultural issues as well as
technological or environmental reasons. Fluorescent lighting can change color perception, an
undesirable result in some situations. Some people perceive a flicker in fluorescent lights,
making them an undesirable substitute for incandescent lights.
As mentioned previously, complete replacement of gasoline with biofuels for
automobile and truck engines is hindered currently by engine design. This barrier can be
removed, but at a cost measured in time and money. In contrast, the lack of sufficient arable
land to produce all the biomass needed to fuel autos and trucks could be a barrier that cannot
be remedied. Social hindrances may be present as well. The substantial agriculture and
sylvaculture efforts required may find a shortage of people willing to return to an agrarian-
based lifestyle.
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3.3.6 Introduction Considerations
Introducing a new technology may require little change and effort or it may require
major shifts in environmental, economic, and social areas. This consideration and the types
of issues that could be raised are illustrated by discussing the biofuel example.
3.3.6.1 Infrastructure Needed to Support the Technology
One major need identified previously for the biofuels technology is facilities to
process the biomass and recover ethanol or methanol. On a scale needed to replace all
gasoline production, this would require major construction of new industrial facilities and the
development of transportation and handling facilities to bring the raw materials to these
facilities. Once the fuel is produced it might be distributed by means similar to that for
gasoline, but that would be a point for investigation.
The issue of more agriculture and sylvaculture activity for biofuels has also been
mentioned previously. The need for greater nutrient replenishment in land used for this
purpose suggests that a significant increase in fertilizer production would be an infrastructure
need.
3.3.6.2 Life of Existing Infrastructure
Replacement of the existing infrastructure that supports oil refining and production of
gasoline would raise new issues. Life of the existing infrastructure would be a consideration
in the period of time over which a conversion to biofuels could be achieved. The
displacement of workers in the existing industry and loss of revenues to oil producers and
refiners would introduce significant political and social pressures to the adoption equation.
3.3.6.3 Investment Needs
Major new investments in growing, transporting, and handling raw materials and new
facilities to produce fuel from biomass are examples of investment needs that would be
competing with other needs of society for scarce investment funds. These are economic and
institutional (political) issues.
3.3.7 Resource Needs
This consideration is self-explanatory. What are the resources needed to implement
the mitigation technology? One example of a resource consideration for the biomass case is
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countries that have no, or minimal, arable land not being able to produce biofuels to support
their needs. Given that climate change is a global problem, countries that have arable land
would be expected to produce enough biofuels to support the have-nots, just as oil-producing
countries now supply those who have none. Taking this issue to the extreme leads to the
question, is there sufficient arable land in the world in climate regions with adequate growing
seasons to support production of the biomass for fuel to replace all gasoline consumed in
automobile and truck engines?
3.3.7.1 Materials
Materials for fluorescent bulbs are mercury and the rare earth elements used in the
phosphor coatings on the interior surface of the bulbs to yield desired colors. Also needed
are microelectronic chips for the electronic ballasts that start and control energy flow to the
bulb or the old electromagnetic ballast type. For biofuels, the land and fertilizer are material
resource needs, among others.
3.3.7.2 Production Processes
For the biofuel example, production processes are needed to convert biomass into fuel
alcohols. These production processes exist, but on a much smaller scale than might be
needed for 100 percent conversion from gasoline to biofuel. Industrial facilities would be
needed to produce the engines that can use 100 percent biofuel. Processes that produce
fertilizer would have to be expanded, or new ones constructed, to achieve the level of
biomass growth desired.
3.3.7.3 Disposal
This resource subcategory deals with disposal of wastes from the technology
production processes, the waste generated by the mitigation activity, and the components of
the mitigation technology when they have reached the end of their useful life. For fluorescent
bulbs, mercury handling in the production process and mercury contained in bulbs that are no
longer functional are examples of waste needing disposal. Wastewater processing and
stillage wastes are examples of biofuel technology wastes requiring disposal. Also
significantly more agriculture waste from harvest would require disposal (or burning with
potential energy recovery).
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3.3.8 Links to Other Technologies/Industries
The items to be addressed here include how the proposed mitigation technology
interrelates with other mitigation technologies and its potential effects on other industries.
3.3.8.1 Impact on Other GHG Sources
Other industries that could be affected by widespread use of biofuels would be
fertilizer manufacturers and pesticide producers. Fertilizer production consumes a significant
amount of energy, so increased use to grow biomass crops would be a consideration in
determining net GHG reduction. Other mitigation technologies could produce beneficial
impacts on GHG sources in other industries.
3.3.8.2 Co-control Benefits
If a mitigation technology reduces GHG emissions from a particular source, other
emissions of environmental concern may also be reduced. Technologies such as fluorescent
bulbs that reduce total energy usage from fossil-fuel generated electric plants have the co-
control benefit of reducing all air pollutants from those plants by reducing the demand for
electricity. Ethanol and methanol produced from biomass that is substituted for gasoline may
achieve reductions in sulfur compound emissions from automobile and truck engines because
the biomass yields a fuel with lower sulfur content. Surface and groundwater contamination
from oil production may be reduced or eliminated; however, these benefits could be offset by
fertilizer and pesticide runoff from production of the crops used to generate biofuels.
3.3.8.3 Ancillary Benefits
These would be benefits other than co-control. For biofuels, this might be reduced
reliance on imported oil, which benefits the foreign trade balance and has strategic
implications.
3.3.9 Technology Alternatives
What other technology alternatives might affect the adoption of the technology being
assessed? They could be competing technologies or complementary technologies such as
mass transportation.
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3.3.9.1 Competing Technologies
Although fluorescent lights are a relatively mature mitigation technology, other types
of energy-saving light designs could be competitors that would curtail further conversions to
fluorescent systems.
Electric cars are an example of an alternative technology that could eliminate the need
for automobiles using biomass fuels. Identifying electric cars as a potential competing
technology does not address the issue of whether they are a better or worse choice from a
climate change perspective, but it indicates the need to investigate its potential impact on
adoption of biomass fuels. Increased use of mass transportation would not eliminate the need
for personal automobiles and trucks using biofuels, but it could reduce the overall demand for
biofuels.
3.3.9.2 Alternative Resource Uses
This issue addresses considerations of scarce resources required by the mitigation
technology and whether they might be used more beneficially for society for other
technologies or other purposes. Mercury and rare earths used in fluorescent lighting are
examples. A hypothetical scenario could be precious metal catalysts for biomass fuel
production being needed for production of other valuable products such as pharmaceuticals
or electronic/computer components.
3.3.10 Technological Future
In assessing the potential for adopting a new mitigation technology and the effects of
other developments, the assessor's thinking should not be constrained to those competing,
alternative, or complementary technologies in existence. Technological innovations could
have a major impact on the decision to implement, or the extent of implementation of, the
mitigation technology. To the extent that these innovations can be conceived and defined to
a degree, their potential impacts can be examined.
3.4 Next Methodology Steps
Once the mitigation technology has been defined through the process above, the next
step is to proceed to the following sections. The methodology discussed in Sections 4
through 6 is subdivided into impact/discipline areas—environmental, economic, and
political/institutional/social. As the assessor proceeds through each section, he/she uses the
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definition table to track which of the characteristic, attribute, or property details has
associated environmental, economic, and political/institutional/social implications. Each of
the subsequent sections provides a series of prompts or questions to consider in exploring
particular aspects of the technology.
3.5 References
Certified Ballast Manufacturers Primer, . As obtained
August 2000.
Ellington, R.T., M. Meo, D.A. El-Sayed. 1993. 'The Net Greenhouse Warming Forcing of
Methanol Produced From Biomass." Biomass and Bioenergy 4:405-418.
Giampietro, M., Sergio Ulgiati, and David Pimentel. 1997. "Feasibility of Large-Scale
Biofuel Production." Bioscience 47(9):587-600.
Westrum, Ron. 1991. Technologies and Society—The Shaping of People and Things.
Belmont, CA: Wadsworth Publishing Company.
The World Book Encyclopedia. Volume 7. 1980. pp. 279-280. World Book-Childcraft
International, Inc.
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SECTION 4
ENVIRONMENTAL IMPACTS
This section links technological and environmental systems to see how GHG
mitigation technologies may affect the environment and in some cases how the natural
environment may shape technology development or application. A table prepared according
to the directions in Section 3 will identify the characteristics, attributes, or properties of a
technology that present the potential for beneficial or adverse environmental impacts. That
table will also help to organize the exploration of those potential environmental impacts
when combined with the approach presented in the section.
The environment is an integrated system of plant and animal communities, natural
resources, and humans that can be viewed in a variety of ways. For example, the
environment can be viewed as a set of ecosystem services, such as CO2 sinks, biodiversity, or
water treatment in wetlands; as a system of interrelated media, such as soil, water, and air; as
a set of natural resources, such as timber, topsoil, and drinking water; and/or as inputs or
outputs to an economic system, such as raw materials and recreation opportunities. There are
benefits to viewing the environmental system from different perspectives. Each perspective
is helpful in a different discussion.
This section uses the media approach, which groups environmental effects by their
impact on air, water, soil, and biota, because it is one way to quickly assess possible effects
of a technological strategy, system, or individual technology for mitigating GHG emissions.
The media approach is well established and familiar to impact assessors and the general
public and corresponds to the ways many environmental programs are handled in
management and regulation. However, one must be aware of cross-media issues, since there
is potential to reduce environmental impacts in one medium by transferring the impacts to
another medium.
This section provides an approach to identifying environmental impacts or effects of a
proposed technological system by using a matrix of environmental media and various
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analysis dimensions. Figure 4-1 lists the environmental media considered, as well as types of
potential impacts.
Technology Introduction
Environmental Medium of Impact
Water
Air
Soil
Biota
Other
Dimensions of Impact
Life-Cycle
Stages
Raw Materials
Manufacture
Use
Disposal
Burden
Direct
Indirect
Threshold
Cumulative
Unknown
Figure 4-1. Environmental Effects of a Technological System
Figure 4-1 shows categories of potential environmental effects of a technological
system. When a technology is introduced, it can affect specific environmental media, like
water, air, soil, biota, or multiple media at once. A technology can affect environmental
media in several different ways. In this section, the ways technology can affect an
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environmental medium are grouped into dimensions of impact, including time, space, life-
cycle stages, burden, and concern. The dimensions of impact are discussed in greater detail
below.
This section provides a framework that ensures the consideration of all significant,
relevant environmental issues. Every technology will trigger a unique set of issues. Rather
than attempt to include an exhaustive list of all possible impacts, the assessment
methodology includes an impact matrix that frames the general types of impacts and lists
categories of effects. Assessors can consider potential impacts in each environmental
medium and use the matrix to consider which impacts might apply to specific technologies.
It is likely that use of the matrix will be an iterative process whereby some impacts will be
readily characterized, while others will require additional data collection. Once an assessor
has applied the matrix to a particular technology, findings can be summarized into a list of
environmental issues relevant to certain technologies. The output of this exercise will be a
thorough understanding of the key environmental issues and identification of additional
research or data collection needs to adequately evaluate the technology.
Additional resources for assessing impacts to the environment are presented at the end
of this section. The additional resources include references to several environmental and
ecological impact assessment guidelines and methods as well as sources of environmental
data.
4.1 Key Aspects of Technology and the Environmental System
To examine how a proposed technology may affect the environmental system, we
provide a matrix that lists environmental media and how those media may relate to the
dimensions of time, space, life-cycle stages, burden, and concern.
4.1.1 Media and Types of Impacts
The media listed in the matrix include air, water, soil, biota, and other (see Table 4-1).
Potential types of impacts in each medium are also characterized. The types of impact or
resources affected cover the range of possible effects in each medium. Listed items are
restricted to general categories of impacts or valued resources rather than waste streams or
components of particular technologies. For example, the water section is divided into
impacts on surface waters and impacts on groundwater. Surface water impacts include
impacts on drinking water quantity, sediment contamination, flood control, and temperature
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Table 4-1. Environmental Media and Types of Impact
Water
Air
Soil
Biota
Other
Surface Waters:
• Drinking water
quality/volume
• Other designated uses
(quality/volume)
• Sediment contamination
• Storm water volume/
contamination
• Flood control channel
alteration
• Temperature changes
Groundwater Water:
• Drinking water sources
• Contaminant infiltration
• Water table
recharge/discharge
• GHG
• Ozone precursors
• VOCs
• HAPs
• Other criteria
pollutants (e.g.,
SOX, NOX, PM)
• Haze/visibility
• Acid precipitation
• Radio nuclides
• Accidental release
Topsoil loss
Soil contamination
Soil alterations/
amendments (e.g., land
application for waste
treatment)
Nutrient depletion
Erosion
Compaction
Acidification
Soil structure/organic
content
Interference/alteration of
soil processes (e.g.,
nitrification-denitrification)
Seismic activity
Unique
geologic/geographic
features
• Habitat destruction or
change/shift
• Vegetation destruction
• Species diversity (plant and
animal)
• Exotic/invasive species
• Sensitive species (plants,
animals)
• Federally protected or
state-listed species
• Old growth or sensitive
natural communities
• Protected natural areas
(e.g., parks, wilderness
areas)
• Interruption/interference
with animal behavior (e.g.,
migratory patterns)
• Interruption/interference
with ecosystem process
(e.g., fire suppression)
Noise
Odors
View sheds
Aesthetic values
Open space
Public access
List other
possible aspects
-------
changes. Groundwater impacts include impacts on drinking water sources, water table
recharge, etc. Although covering every possible impact to water is not possible, the impacts
that are listed are general groups of impacts intended to prompt the user to list more specific
impacts depending on the technology being evaluated.
Air impacts include GHGs, ozone precursors, and regulated air pollutants such as
volatile organic compounds (VOCs) and hazardous air pollutants (HAPs). The soil section of
the matrix lists impacts like changes to soil structure, topsoil loss, soil contamination,
nutrient depletion, and others, while the biota section covers topics like habitat change,
species diversity, and sensitive species.
The matrix is intended to be broad and inclusive enough to apply to a wide variety of
mitigation technologies. Not all media or types of impacts will be relevant for all
technologies. Furthermore, impacts will probably be associated with particular technologies
that are not specifically listed in the matrix. Assessors should use the matrix as a starting
point and develop a detailed impact characterization within the matrix structure. Assessors
must also be aware of cross-media issues by considering how each impact may lead to
impacts in another medium. For example, topsoil loss or erosion in the soil section may be
linked to sediment contamination in surface waters.
4.1.2 Dimensions of Impact
Each impact will manifest itself in a different way depending on whether it is
immediate or long term, local or global, or direct or indirect, or whether it affects human
health. The dimensions of impact section of the matrix attempts to clarify or describe the
type of impact (see Figure 4-2). For instance, the time dimension addresses whether the
environmental aspect is an immediate, short-term, or long-term issue or a combination of
these. In some cases, an immediate problem may be a high priority, while in other cases
long-term effects will be more important. For instance, an immediate air quality problem
may occur if an air emissions control.device malfunctioned and people's health is threatened.
On the other hand, global climate change may be seen as high priority because of the long-
term or large-scale consequences of current activities.
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Time
Immediate
Short-term
Long-term
Space
Local
Regional
National
Global
Life-Cycle
Stages
Raw Materials
Manufacture
Use
Disposal
Burden
Direct
Indirect
Threshold
Cumulative
Unknown
Concern
Human Health
Ecological
Health
Other
Figure 4-2. Dimensions of Impact
The space dimension deals with the geographical distribution of the impact (i.e.,
whether an environmental issue is global, national, regional, or local). A technology could
address a global problem and a local problem simultaneously; for example, biofuels may
mitigate an air emissions problem in a small town but also affect the global environment.
The space dimension also addresses how technologies might improve a national issue while
failing to address local problems. For example, hybrid vehicles may eventually lead to a
national reduction in mobile air pollution, but they could fail to address air emissions in local
nonattainments areas where hybrid vehicles are not easily accessible.
The life-cycle stages dimension consists of four possible stages: raw materials,
manufacture, use, and disposal, which together represent the entire life of a particular product
or technology. Identifying life-cycle stages can help an assessor determine which
environmental impacts come from various stages in the creation, use, and ultimate disposal of
a product. Associating impacts with a specific life-cycle stage provides detail and encourages
assessors to be precise about impacts. For example, negative impacts may be concentrated in
one life-cycle stage, such as the proper handling of mercury in the disposal stage of
fluorescent light bulbs. In other cases, more than one life-cycle stage may be important.
The burden dimension allows the assessor to explore if a potential impact is direct or
indirect, whether the impact has a cumulative or threshold effect, or if the impact is unknown.
For example, if the use of biofuels were to increase the amount of land under cultivation in a
particular region, there could potentially be increased land-clearing activity. An immediate
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direct impact of land clearing is increased erosion and siltation in adjacent streams. Often,
these immediate direct impacts last only as long as active clearing activities are taking place.
However, over time, indirect impacts could occur if deposited silt is re-entrained and carried
further downstream to impact additional aquatic communities. Cumulative impacts would be
important to consider if land-clearing activities occurred at several different locations within
a watershed, compounding the sediment load to aquatic communities.
The concern dimension attempts to address the human health, ecological health, or
other areas where a media aspect could lead to an impact affecting health. Discharges of
pollutants to any environmental medium have the potential to adversely affect human health
or the health of wildlife and plants. Chemicals associated with known cancer risk (e.g.,
dioxins, polyclorinated biphenyls) or other health risks should be identified. In addition,
many chemicals are known to bioaccumulate or to cause significant health risks in fish and
other wildlife (e.g., mercury) and should also be identified. Section 4.3 provides several
sources of information on human and ecological health effects for specific chemicals.
4.1.3 Matrix
The media, types of impact, and dimensions of impact are combined into a matrix
format for ease of use (see Table 4-2). The matrix is divided into separate worksheets for
each medium and dimension of impact to facilitate taking extensive notes. The matrix is
designed to be flexible and can be used in a variety of ways, depending on the technology
being assessed or the assessor's objectives. The matrix can function as a discussion guide, a
draft analysis of environmental impacts, or a list of areas needing more research. Three
approaches to using the matrix are illustrated here as examples:
• a checklist with notes,
• an assessment planning aid, and
• a scoring tool.
Each of these ways to use the matrix is described briefly.
4.1.3.1 Checklist
The matrix can be used as a checklist to identify benefits or areas of concern for the
technology being evaluated. With this approach, potential significant impacts are identified,
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Table 4-2. Characterization of Environmental Impacts
Environmental Screening Matrix
A
Medium
of
Impact
Water
Air
8
Type of Impact or
Resource Affected
Surface Waters
• Drinking water quality/volume
• Other designated uses (quality/volume)
• Sediment contamination
• Storm water volume/contamination
• Flood control
• Channel alteration
• Temperature changes
Groundwater
• Drinking water sources
• Contaminant infiltration
• Water table recharge/discharge
• GHGs
• Ozone precursors
• VOCs
• HAPs
• Other criteria pollutants (e.g., SOX, NOX, PM)
• Haze/visibility
• Acid precipitation
• Radio nuclides
• Accidental releases
C Will This Aspect Improve or Degrade the Status Quo?
Time Scale
Long-term
Immediate
Spatial Scale
Global
National
Regional
Local
Life Cycle Stages
Raw Materials
Manufacture
Use
Disposal/Recycle
Burden
Direct
Indirect
Cumulative
Threshold
Unknown
Concern
Human Health
Ecological Health
Other
oo
(continued)
-------
Table 4-2. Characterization of Environmental Impacts (continued)
Environmental Screening Matrix
A
Medium
of
Impact
Soil
Biota
B
Type of Impact or
Resource Affected
• Topsoi! loss
• Soil contamination
• Soil alterations/amendments (e.g., land application
for waste treatment)
• Nutrient depletion
• Erosion
• Compaction
• Acidification
• Soil structure/organic content
• Interference/alteration of soil processes (e.g..
nitrification-denitrification)
• Seismic activity
• Unique geologic/geographic features
• Habitat destruction or change/shift
• Vegetation destruction
• Species diversity (plant and animal)
• Exotic/invasive species
• Sensitive species (plants, animals)
• Federally protected or state-listed species
• Old growth or sensitive natural communities
• Protected natural areas (e.g., parks, wilderness areas)
• Interruption/interference with animal behavior (e.g.,
migratory patterns)
• Interruption/ interference with ecosystem process
(e.g., fire suppression)
C Will This Aspect Improve or Degrade the Status Quo?
Time Scale
Long-term
Immediate
Spatial Scale
Global
National
Regional
Local
Life Cycle Stages
Raw Materials
Manufacture
Use
Disposal/Recycle
Burden
Direct
Indirect
Cumulative
Threshold
Unknown
Concern
Human Health
Ecological Health
Other
(continued)
-------
Table 4-2. Characterization of Environmental Impacts (continued)
Environmental Screening Matrix
A
Medium
of
Impact
Other
B
Type of Impact or
Resource Affected
• Noise
• Odors
• View sheds
• Aesthetic values
• Open space
• Public access
• List other possible aspects
C Will This Aspect Improve or Degrade the Status Quo?
Time Scale
Long-term
Immediate
Spatial Scale
Global
National
Regional
Local
Life Cycle Stages
Raw Materials
Manufacture
Use
Disposal/Recycle
Burden
Direct
Indirect
Cumulative
Threshold
Unknown
Concern
Human Health
Ecological Health
Other
.p-
H—
O
-------
but quantification of impacts or highly detailed descriptions are not developed. For example,
if biofuels are being evaluated with a focus on tailpipe emissions, significant positive impacts
are expected for air quality because of reduced emissions. The following air impact
categories could be noted as areas of potential positive impacts:
• GHGs, reduced tailpipe and manufacturing emissions
• ozone precursors, reduced tailpipe emissions
• VOCs, reduced manufacturing emissions
• other criteria pollutants, and reduced tailpipe emissions
• haze/visibility. reduced tailpipe emissions
Additional media would also be evaluated for potential positive impacts. Water
impacts could include, for example, decreased nitrogen deposition in water bodies; in some
areas, soil acidification could potentially be mitigated; and for biota, ozone damage to crops
might be mitigated. Each positive impact would be noted, along with a short description
justifying its notation or describing the cause or extent of the impact. Positive impacts that
included the manufacture of gasoline would be quite different than those associated with
tailpipe emissions alone.
For negative impacts, the assessor could consider the crop production and processing
for manufacturing ethanol or methanol as well as impacts from the use of biofuels. For
example, discharge of process water used during manufacture; waste management practices
such as surface impoundments, landfills, or land application; or deposition of manufacturing
air emissions to surface water bodies all can adversely affect surface or groundwater quality.
Drinking water quality could be affected by greater pesticide use with increased crop
production or introduction of crop production into new regions or localities. Groundwater
and surface water availability could become a problem with large-scale crop production and
the associated water demand. Soil erosion and nutrient depletion may increase due to
cultivation of monoculture. Biota impacts could include clearing or alteration of existing
habitat for biofuel crop production. The matrix impact categories listed in Table 4-3 would
be flagged with corresponding notes about cause and extent for potential negative impacts.
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Table 4-3. Matrix Impact Categories: Biofuels Example
Water
Surface water
- Drinking water quality/volume
- Other designated uses
(quality/volume)
- Sediment contamination
- Storm water
volume/contamination
Groundwater
- Drinking water sources
- Contaminant infiltration
- Water table recharge/discharge
Soil:
• Topsoil loss
• Soil contamination
• Nutrient depletion
• Erosion
Biota:
• Habitat destruction or change/shift
• Vegetation destruction
• Species diversity
pesticides and fertilizers from crop production,
water use for crops, discharge of process water
pesticides and fertilizers from crop production,
water use for crops, discharge of process water
pesticides and fertilizers from crop production
agricultural waste water management;
discharge of process water
water demand for crops
increased pesticide and fertilizer use
water demand for crops
additional land under cultivation
increased pesticide and fertilizer use
use of monoculture
additional land under cultivation
crop production displacing habitat
increased crop production, pesticide use
habitat loss, pesticide use
In addition, possible adverse impacts to air quality would offset the positive air
impacts identified. Ultimately, each life-cycle stage and medium would be addressed, and
impacts would be characterized in terms of the different dimensions in the matrix. These
examples are not exhaustive but suggest a way the environmental impacts matrix can be used
to develop a list of concerns. The nature and mechanisms of the impacts have not been
described; rather, the checklist approach simply provides an inventory of areas of concern.
Flagging the potential impacts and inserting short comments gives assessors a list of impacts
4-12
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that they can use to compare to the impacts of other technologies. The impacts checklist
could also be used as a starting point for further research.
4.1.3.2 Assessment Planning
The matrix can also be used for preliminary planning for an in-depth or quantitative
assessment. For example, the matrix can be used to organize notes on priorities, associations
between impacts, critical pathways, data needs, or cross-technology issues about the
dimensions of impact and other important considerations of a technology. In the case of
biofuels, the assessor might begin by using the checklist approach to establish the types of
relevant impacts and then refer the matrix for each medium to individuals with the
appropriate expertise for further characterization of the impacts. At this stage, the flagged
impacts would be described in terms of priority and relative magnitude. The life-cycle stages
could be ranked based on number or significance of impacts, the regions or localities likely to
experience particular effects could be identified, and human health concerns would be
identified and described.
Using the general example of biofuels and the biota portion of the matrix, the flagged
areas of habitat destruction or change/shift, vegetation destruction, and species diversity
would be characterized in more detail, especially for the areas of great concern. Raw material
production would be noted as the life-cycle stage of primary concern. Data needs might be
noted for crop area requirements and optimal soil types and climate characteristics for crop
production. Contamination from the use of pesticides and fertilizers might be identified as a
primary human and ecological health concern; thus, crop-specific pesticide and fertilizer
application rates and soil erosion rates would be identified as critical assessment data needs.
In the water medium, an assessor might identify manufacturing process wastewater as
a significant impact on water quality. Under life-cycle stages, one would list the
manufacturing stage, since that is when the effluents are produced. Effluents would have a
local impact, unless production on a national scale grew rapidly. The temporal impact would
be immediate and potentially long term if environmentally persistent or bioaccumulative
contaminants are involved. The impact burden would be described as direct (e.g., point
source discharges), indirect (e.g., potential accumulation of pollutants in sediments), or
cumulative (e.g., more than one manufacturing facility in a single watershed). Significant
concern would be noted for human health or ecological health if effluent constituents have
documented adverse effects. (See the additional resources listed at the end of this section for
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suggested sources of information on health effects.) Table 4-4 shows how notes were taken
for the water impacts of a proposed biofuels technology.
4.1.3.3 Scoring Tool
The matrix can be used as a scoring tool to compare the relative importance of
various impacts. One way to use it as a scoring tool is to make a chart of low, medium, or
high impacts. Assessors could enter an "L" for a low impact, an "M" for a medium impact,
or an "H" for high impact in each of the columns. They could also use the margin as a place
to summarize the overall impact. For instance, if a proposed biofuels project would lead to
habitat destruction in a particular area, one might list a high impact in most of the columns.
There would be a high impact in the manufacturing life-cycle stage and on the local
geographic level. The biofuels project might not have an immediate or a direct impact, so
those columns would be marked as a low impact. However, the ecological health concern
might be high. So the overall impact in the area of habitat destruction would be a high
impact.
A similar level of impact assessment could be completed for each type of impact.
Then the number of low, medium, and high ratings could be aggregated by environmental
medium, by life-cycle stage, or by any of the matrix dimensions. Weighting factors, such as
3 for high, 2 for medium, and 1 for low can be applied to derive a quantitative evaluation of
potential impact. For example, if this particular biofuels technology scores high for three
biota impacts (e.g., habitat destruction, vegetation destruction, and species diversity), the
weighted score for biota impacts would be nine (3x3 = 9). Weighted scores could be used
to compare or prioritize potential impacts within and between assessments. Impacts with the
highest scores could be assessed further through sensitivity analysis, identification of affected
populations, or other thorough analysis.
4.1.3.4 Summary
As discussed above, the matrix can be used to generate a list of impacts or a table of
important considerations or as a scoring tool of high, medium, and low impacts. Each of
these approaches has its benefits and limitations. The matrix can probably be used in other
ways; it is designed to be flexible depending on the intent of the exercise. The matrix can be
used to flag areas of concern, highlight benefits, and point to impacts that need to be explored
or researched in more detail.
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Table 4-4. Example of Assessment Planning Function of the Environmental Screening Matrix
Environmental Screening Matrix
A
Medium
of
Impact
Water
B
Type of Impact or
Resource Affected
Surface Waters
• Drinking water quality/volume
C Will This Aspect Improve or Degrade the Status Quo?
Time Scale
Long-term
Immediate
Immediate
Spatial
Scale
Global
National
Regional
Local
Local
Life Cycle Stages
Raw Materials
Manufacture
Use
Disposal/Recycle
Manufacture —
significant effluents
Burden
Direct
Indirect
Cumulative
Threshold
Unknown
Direct — point source
discharge
Indirect — accumulation
in sediment
Cumulative — many
facilities in a single
watershed
Concern
Human Health
Ecological Health
Other
Human — depends on
effluents
Ecological — depends
on effluents
-------
However the matrix is used, it should facilitate determining the potential impacts of a
technology in the various media. When comparing technologies, the assessor could compare
the number of impacts listed under each technology, the dimensions of the impacts, or the
intensity of the impact (high, medium, or low).
4.2 Conclusion
This section describes an approach to identifying environmental impacts or effects of
a proposed GHG mitigation technology system by using a matrix of environmental media and
various analysis dimensions. Proposed technologies to decrease emissions of GHGs will
have beneficial impacts on global climate change. However, environmental impacts, both
positive and negative, will vary depending on the particular technology. The matrix
described in this section lists major environmental impacts in a straightforward manner.
The assessor is encouraged to go through each medium methodically without
assuming that a particular medium may not apply. The purpose of the environmental
screening matrix—to specify impacts that are not readily apparent—will be undermined if
certain media are overlooked. After considering all of the impact categories in the matrix, the
assessor will have developed a comprehensive list of potential environmental impacts, some
of which may require additional research to ascertain their nature or seriousness. The
assessor will also have a sense of the possible effects or relative importance of the impacts.
4.3 Additional Resources
As an aid to using the environmental impacts matrix, several resources are listed in
Tables 4-5 and 4-6. These additional resources provide more information on three general
areas:
• environmental impact assessment methods,
• . types of environmental impacts relevant in various media, and
• sources of human and ecological health data.
The first two types of information will be generally relevant to using the matrix. Included are
Internet sites and documents that provide various government agencies' approaches and
methodologies for assessing environmental impacts. In addition, some of the listed resources
present actual environmental impact assessments that include comprehensive, detailed lists of
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Table 4-5. General Resources for Identifying Environmental Impacts
Organization
Description
URL
Department of Energy
(DOE)
National Environmental
Policy Act (NEPA)
Status Chart
NEPA Compliance
Guidelines
University of Manchester
Environmental Impact
Analysis
Example of environmental impacts assessed at DOE Laboratories (Louis
Livermore National Laboratory and Sandia National Laboratory). Tables S-3
and S-4 in particular present thorough lists of areas/categories of
environmental impacts.
A list of current impact assessment reports. DOE sponsors energy
technologies that are relevant to GHG mitigation. The impact assessments
for these technologies may provide relevant information.
National Environmental Policy Act (NEPA) Compliance Guidelines:
Appendix C. This appendix provides a comprehensive list of legislation and
executive orders that are relevant to environmental impacts. (Appendix C
begins on page 22 of 33.)
http://nepa.eh.doe.gov/eis/
eis0157/eis0157 es.html#6943
http://tis.eh.doe.gov/portal/
http://ceq.eh.doe.gov/nepa/regs/
execll979.html
A web site devoted to environmental impact assessment. Includes a wide
variety of resources; a search on the key words "environmental impact
assessment" gives many impact assessment reports as well as documents
presenting assessment methodologies. Covers impact assessments
throughout the world.
http://www.art.man.ac.uk/EIA/
EIAC.htm
U.S. Forest Service Rocky Report: Assessment of Southwestern Forest Ecosystem Health. Provides
Mountain Forest and examples of ecological and environmental impacts. See especially Chapter
Range Experiment Station 2.
http://www.rms.nau.edu/
publications/rm_gtr_295/
(continued)
-------
Table 4-5. General Resources for Identifying Environmental Impacts (continued)
Organization
Description
URL
Canadian Environmental
Assessment Agency
Guidance document: Guide to the Preparation of a Comprehensive Study for
Proponents of Responsible Authorities. See especially:
• Appendix C—Sections 7 and 8 at
• Reference Guide: Cumulative Effects Reference Guide at
• Reference Guide: Determining Whether a Project is Likely to Cause
Significant Adverse Environmental Effects at
http://www.ceaa.gc.ca/comps/
comps_e.htm
Sadler, Barry (1996)
oo
Environmental Impact
Analysis Data Links
International Study on the Effectiveness of Environmental Assessment. A
study supported by eight industrialized nations (including the U.S.), the
United Nations Environment Programme, and other multinational
organizations; evaluates the effectiveness of impact assessment efforts and
proposes principles and options for strengthening environmental assessment
methods. Go to the bottom of the first screen to find the table of contents;
see especially Sections 7.0 and 7.3.
An excellent source of links to environmentaldata bases available on the
Internet. Includes agricultural, energy, hydrologic, meteorologic, spatial, and
wetlands databases as well as links to state and regional environmental
information agencies.
http://www.environment.gov.au/
epg/eianet/eastudy/final/
main.html
http://water.usgs.gov/eap/
env data.html
Council on Environmental
Quality (CEQ)
Document: Considering Cumulative Effects Under the National
Environmental Protection Act (NEPA). See especially Chapter 4:
Determining the Environmental Consequences of Cumulative Effects. The
table of contents with links to each chapter is available at:
http://ceq.eh.doe.gov/nepa/
ccenepa/ccenepa.htm
(continued)
-------
Table 4-5. General Resources for Identifying Environmental Impacts (continued)
Organization Description URL
U.S. Global Climate This is an excellent site, potentially useful for all aspects of GHG mitigation http://www.gcrio.org/
Change Research technology assessment.
Information Office
(GCRIO)
U.S. Department of Bureau of Reclamation (USER); Decision Process Guidebook. Guidance for http://www.usbr.gov/Decision-
Interior (DOI) decisionmaking in government agencies. Chapter entitled "Indicators" Process/indicate.htm#exercise
discusses selection of assessment parameters as indicators of impacts.
-------
Table 4-6. Resources for Human and Ecological Health Effects Data
Organization
Description
URL
to
o
U.S. Environmental
Protection Agency (EPA)
TOXNET
ECOTOX
Recent publications on climate change. Publications include mitigation
technology impact assessments.
Environmental Assessment Resource Guide: general resource for
environmental assessments for many types of projects.
A cluster of databases on toxicology, hazardous chemicals, and related areas.
Includes links to EPA's Integrated Risk Information System (IRIS), which is
the definitive source of human health benchmarks for most government
agency work. Also includes links to additional toxicological databases.
ECOTOX Database System. EPA's source for ecological toxicity data.
Combines three data sets: AQUIRE (aquatic life), PHYTOTOX (terrestrial
plants), and TERRETOX (terrestrial wildlife).
http://eetd.lbl.gov/ea/ccm/
ccPubs.html
http://www.epa.gov/seahome/
earg.html
http://toxnet.nlm.nih.gov/
http://www.epa.gov/ecotox/
Oak Ridge National
Laboratory (ORNL)
California Environmental
Protection Agency
Screening ecological benchmark publications, available for downloading.
ORNL screening benchmarks are recommended protective environmental
concentrations for a wide variety of chemicals and wildlife species. ORNL's
screening benchmarks are thoroughly reviewed and widely accepted
reference values.
California Wildlife Exposure Factor and Toxicity Database of ecological
toxicity data. Data are thoroughly reviewed and widely accepted benchmark
values.
http://www.hsrd.ornl.gov/ecorisk
/reports, html
http://endeavor.des.ucdavis.edu/
calecotox/
Environment Canada
The Herptox Page web site contains toxicity information for herpetofauna
(amphibians and reptiles). This class of animals is one of the least well
studied and generally lacks definitive toxicological benchmarks. This site
fills some of the ecotoxicological data gaps.
http://www.on.ec.gc.ca/herptox/
-------
media-specific impacts. Such lists can be useful in scoping potential issues for a particular
GHG mitigation technology.
The third area of additional resources, human and ecological health data, is provided
to assist with the concern dimension. Human and ecological health risks can be evaluated in
terms of protective benchmarks that indicate pollutant concentrations that have been shown
to have no or low adverse effects. The resources provided are readily available, authoritative
sources of human and ecological toxicity data that can be used as conservative screening
benchmarks.
4.4 References
Sadler, Barry. 1996. International Study of the Effectiveness of Environmental Assessment.
Australian EIA Network.
.
Accessed on February 21, 2001.
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SECTION 5
ECONOMIC SYSTEM
New technologies are produced and distributed through the economic system. The
interactions between producers and consumers and their decisions about whether to adopt a
new technology and how to use it determine the impact of the technology on society and the
environment. Defined broadly, the economic system encompasses the allocation of resources
across different activities. Table 5-1 lists the major sectors of the economy as defined by the
Census two-digit North American Industrial Classification System (NAICS) codes.1 All
sectors of the economy, including both the private and public sectors, use resources and
generate output and pollution.
This section focuses on the decision to adopt a technology and the potential impacts
of the technology on the production of goods and services by producers for consumers.
Section 6 addresses governments and other nonprofit organizations. Sections 5.1 and 5.2 are
organized around a series of questions meant to walk the assessor through some of the key
factors that influence the decision to adopt a technology, produce a technology, and use a
technology for both firms and consumers. The tables containing the questions relevant to the
production and consumption decisions provided later in the section serve as a tool to guide
the assessment process, note the relative importance of the considerations identified, and note
where additional information may be needed. The tables present sample questions an
assessor might want to consider in assessing a new technology using biofuels and fluorescent
light bulbs as examples.
In the economic system, economic institutions and the environment interact. Firms
use resources from the environment, including natural resources, air, land, and water, to
produce goods and services for consumers. In turn, producing goods also produces pollutants
The NAICS codes are broken down into finer distinctions within broad categories and provide the basis for
organizing much of the Census information on production of goods and services.
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Table 5-1. NAICS Sectors
11 Agriculture, Forestry, Fishing, and Hunting
21 Mining
22 Utilities
23 Construction
31-33 Manufacturing
42 Wholesale Trade
44-45 Retail Trade
48-49 . Transportation and Warehousing
51 Information
52 Finance and Insurance
53 Real Estate and Rental and Leasing
54 Professional, Scientific, and Technical Services
55 Management of Companies and Enterprises
56 Administrative and Support and Waste Management and Remediation Services
61 Education Services
62 Health Care and Social Assistance
71 Arts, Entertainment, and Recreation
72 Accommodation and Food Services
81 Other Services (except Public Administration)
92 Public Administration
(or residuals) of various types and amounts that affect the environment. Households make
decisions about the purchase, use, and disposal of goods that also have an impact on the
environment (Figure 5-1). To accurately determine the final impact of a new technology on
human welfare, one must consider the potential behavioral changes of firms, households, and
the government in response to the consequences of new technologies. Some of the impacts
from a new technology will be obvious, while others will be difficult to predict, and the
responses of businesses and consumers will evolve over time. New technology can change
production and household decisions and the resulting flows of natural resources into
production and use of goods and services by consumers. On the other end, new technology
can change the composition and/or flow of residuals or pollution into the environment.
5-2
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Number of
Users
Time
Figure 5-1. Technology Diffusion
5.1 Economic Models of Technology Adoption
Technology adoption is observed to follow an S-shaped curve (see Figure 5-1) in
which the technology is adopted slowly at first, then it experiences a period of rapid adoption,
and finally the adoption rate slows again as the technology approaches the saturation level.
Empirically, this simple curve seems to fit the data on adoption rates reasonably well,
although for a specific technology, the curve may be skewed one way (e.g., with a longer,
slower start-up period). A variety of theories explain the S-shaped curve, including the
epidemic model (adoption rates increase as information about how to use the technology
develops), the word of mouth model (individuals spread information about the technology to
a certain percentage of the population), a probit model (firms differ from each other in their
need for and ability to adopt new technology, so only a few first movers adopt the technology
early on), and "information cascades" (information about the technology and rival
technologies has an impact on the speed with which the chosen technology is adopted) (see
Geroski [2000] for a description of these models). In addition, some models try to predict
which technologies will be adopted at all and which will fail.
Despite a great deal of research on technology adoption, the results have not been
conclusive, and predicting the pattern of adoption is still difficult. Although this section
separates the factors that affect the rate and level of adoption for a technology and the impact
5-3
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of the technology on economic markets once it is adopted, these is considerable overlap
between these two. Clearly the expected impact of the technology on a firm or industry will
affect the probability that the technology is adopted. A complete discussion of the likelihood
that a technology will be adopted includes the expected impacts discussed in Section 5.4.
Several main factors appear to influence the rate and level of adoption of new
technologies. The material presented below is primarily drawn from a survey of the
technology diffusion literature by Geroski (2000), unless otherwise noted. Although the
questions are written from the point of view of a firm adopting a new technology, households
also adopt technologies, and many of the issues listed below apply to a household's decision
as well.
The following characteristics of new technology may influence the rate and level of
adoption:
• Are start-up costs high? Costs could include capital, training, installation, or
others. High start-up costs may hinder the spread of technology, especially where
access to credit is limited (dairy farming in Kenya [Batz, Peters, and Janssen,
1999], solar home systems [Brewster, 2000]).
• Does the technology require complex management or other support activities,
which may slow adoption (Batz, Peters, and Janssen, 1999)? Diffusion is faster
for simpler technologies, when knowledge is easily learned and transmitted.
• Is the technology easy to use? Is information on how to use the technology
effectively spread by word of mouth from users to nonusers? Diffusion can lag in
this case.
• Does the new technology enhance the existing capabilities of the target consumers
or replace an existing way of doing things (firms and households may be more
quick to adopt enhancing technologies and slow to adopt technologies that destroy
competency in a particular area and force them to leam a new way of doing
things)?
• Does sufficient evidence exist to prove the new technology is clearly better than
the old technology or rival technologies (a lack of evidence or inconclusive
evidence may slow adoption)?
• Are there rival new technologies (may slow adoption while the market decides
which technology is superior)?
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What are "hardware" and "software" aspects of new technologies? The former is
the machine or physical object that embodies the technology, and the latter is the
information base needed to use it effectively. Hardware is generally more easily
acquired than software because software is a knowledge base and not as easily
diffused. For example, one can purchase a software package manual, but it is not
the same as knowing how to work with the program from experience.
What is the effect of technological expectations? New technology is unlikely to
arrive in its final form; expectations of forthcoming improvements in the new
technology (or significant cost reductions over time) are likely to inhibit the
technology's diffusion. Likewise, expectations of forthcoming improvements (or
cost reductions) in the existing technology may also slow diffusion of the new
technology.
What are the leam and search costs? When technologies are first introduced, the
benefits of adopting the new technology are often difficult to gauge with certainty,
and they may seem too risky to be worth it. As time passes and more information
becomes available, companies may reevaluate the decision to adopt. How fast
this happens depends on how fast firms learn, and this depends on the nature of
the firm and the types of employees.
What is the installed base of the old technology? The more a firm has invested in
the old technology, the slower adoption of the new technology.
Is there a resale market for the capital investments in the old technology? With no
resale market for old capital, firms will delay adoption of new technology until the
full cost of the new technology falls below the marginal cost of the old
technology. Thus, adoption will be slowed.
Will the move to the new technology be irreversible? If the new technology does
not generate the expected results, can the firm revert back to the old technology?
When decisions are irreversible, firms may be slower to adopt new technologies,
and they may demand a higher expected return from the new technology before
switching.
Risk of bankruptcy from a wrong decision will also slow diffusion. If the move to
the new technology is irreversible (or difficult to reverse) and the technology
affects a critical element of operation for the firm (if the decision to adopt the new
technology is a "bet the firm" decision), firms may require higher expected
benefits from the new technology.
5-5
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The following characteristics of the firm or industry may influence the rate and level
of adoption:
• Are the distributors of the new technology connected to the potential buyers (do
distributors already have established relationships with potential buyers)?
• Do distributors offer firms just one technology or a range of new technologies?
• Are firms (or consumers) heavily invested in old technology (if switching is more
expensive, rate of adoption will be slower)?
• Do potential users of technology have access to sufficient credit?
• Diffusion is faster if the potential users mix easily and have frequent contact.
• In general, large firms seem to adopt new technologies faster than small firms
(their staff is more technically able; they use technology on a larger scale, so they
experience cost savings; they are less risk-averse; they have more financial and
other resources; they are inclined to preempt smaller rivals), although the evidence
on this point is mixed and some studies find smaller firms adopting technology
faster.
• More competitive market may lead to faster adoption of new technology if firms
are looking to get a cost advantage on rivals (some evidence indicates that firms
facing few rivals are slower to adopt new technologies).
• But in highly competitive markets, low profit margins may make it more difficult
for firms to adopt new technologies.
5.2 New Technology and the Economic System
Typically, the impact of a new technology or regulation on producers can be captured
through an economic impact analysis (EIA). An EIA can provide estimates of the expected
changes in the prices and quantities produced in the market of interest. The impacts of the
changes can be broken down between different subgroups such as consumers and producers,
large and small firms, or geographic regions. Using predictions about the changes in
quantities produced and the geographic distribution of the changes, one could then examine
how patterns of employment or pollution might change. Generally, data are collected to
estimate the following types of variables without and with the new technology for the time
period of the analysis (some or all of these may be applicable to a given technology):
5-6
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• facility- and industry-level impacts, which may include revenue, cost, and profit
changes; changes in capacity utilization; facility and process closures;
employment changes; compliance cost burden if the technology is mandated by a
regulation;
• market-level impacts, which may include changes in market prices, domestic
production and consumption, and foreign trade;
• company-level impacts, which may include compliance cost burden and its impact
on financial viability and/or failure;
• community-level impacts, which may include changes in employment, facility
closures, and changes in emissions;
• governmental impacts, which may include the costs of administrative, monitoring,
and enforcement actions and changes in receipts from taxes or fees; and
• social costs and benefits.
When considering a technology aimed at businesses and improving some feature of
the production processes, the "materials balance" approach to modeling production is a useful
way to think about the relationship between inputs and outputs and production technology,
especially when we are concerned about pollution (Anderson, 1987). The mass of the inputs
(resources and energy) must equal the mass of the outputs (material outputs, waste from
incomplete use of material inputs, work energy used in production, energy embodied in the
output, and waste energy). This approach to thinking about production helps clarify
opportunities for technology improvements and the trade-offs involved in trying to change
the level of an input or an output. Decreasing the level of one type of waste output (e.g., air
emissions) will lead to an increase in the level of another type of waste output (e.g., solid
waste that is landfilled) if all else stays constant. To a certain extent, inputs into the
production process from capital and labor can "substitute" for resources by manufacturing an
output more efficiently (wasting fewer resources and producing more output per unit of
resource), but only to a point.
The following subsections present a simplified outline for conducting an economic
analysis of the impact of a new technology. As with any product, economists must
investigate the conditions that characterize the supply of the product and the demand for the
product. On the supply side, economists want to characterize the factors that will impact
marginal and fixed costs, the nature of competition among suppliers, and potential for cost
5-7
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reductions with cumulative production -of the new technology. Likewise they want to
investigate the conditions that will shape demand for the technology, including availability of
substitutes, significant income effects, and any psychic or nonmonetary benefits. For the
purposes of technology assessment, it is most important to consider the projected path of
costs as it relates to consumers' willingness to pay. These factors are discussed in the
remainder of this section.
When analyzing technologies for reducing GHG emissions, the consumers of the
technology may be other firms or individual people (see Figure 5-2). If other firms will use
the technology, then the analysis should look at how the technology will change the marginal
costs for the products the firms produce (for which this new technology is an input). The
analysis will focus on how the technology changes costs in firm-to-firm interactions;
whereas, in the case of sales to households, demand considerations may be more important,
and the analysis should characterize their demand for the product. Some of the factors
identified as important below are also important to whether and how fast the technology is
adopted.
Producers of New
Technology
>,
•
Industrial Consumers
of New Technology
w
W
Household
Consumers of New
Technology
Figure 5-2. Technology Production and Diffusion
Does the new technology replace the "old" way of producing the good or service?
Both the new and old technologies may produce joint products—several products with one
technology (cookstoves produce heat for cooking and smoke for killing insects in the home,
producing chlorine gas from brine also produces caustic soda). When evaluating the impact
of a new technology, one needs to think about all the possible goods and services that can be
produced with both the new technology and the old technology. If the old technology
5-8
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provided other services, then these may or may not need to be replaced by another good or
service.
5.2.7 Supply of the New Technology
If the technology is a tangible good (not just a process change), then someone has to
produce that good using other resources.
Firm-Level Effects
WHO? Identify the likely producers of the new technology and the market conditions
in which they operate.
• Who will produce the technology (new firms, existing firms, joint venture, a
mixture)?
• How will they finance the production (is access to credit a problem)?
• What is the regulatory climate? (Are permits required? Are producers subject to
special regulations? Do government programs support the use of the new
technology?)
• Do producers have an existing supply network linked to potential consumers of
the new technology?
• What about firms or industries that produce goods that are substitutes—how much
competition will the new producers face from substitutes? Do competitors have
better supply networks or long-standing contracts with potential customers?
• How big are firms that produce complementary products? Will they be able to
meet demand? Will they cooperate on marketing and other aspects of business?
Is the new technology very important to sales of complementary products or not
very important?
HOW? Describe how the new technology will be produced. Identify key inputs
(capital, labor or resources and raw materials) that drive the cost of production and inputs that
might be in short supply and thus limit the ability to produce large quantities of the product.
• What are the resource requirements (e.g., minerals, oil, electricity)?
• What are the capital requirements (buildings, machinery)?
• What are the labor requirements?
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• Can key inputs be identified that have a large impact on the cost of production or
feasibility of the technology?
• Will any inputs be imported from foreign counties?
• What is the minimum efficient scale? Are there economies or diseconomies of
scale? Is the minimum efficient scale likely to change over time?
• Are there large start-up costs?
• Are there barriers to entry from potential lack of skilled workers, lack of natural
resources, or lack of capital?
• How will the product (technology) be distributed—through existing networks or
in a new way?
• Waste disposal
- What wastes (pollution residuals) result from the production process?
- How will the residuals be treated and disposed of?
Industry-Level Effects
• Is there already an industry producing this product?
- Is the industry competitive, concentrated?
- Is the industry vertically integrated? (the same firm produces some or all of
the inputs needed for the final goods they sell on the market—paper
companies are vertically integrated because they own timber and timber mills
and produce the inputs used to create paper)
• How will production of the new technology change prices of inputs and outputs
for the industry?
Economy-Wide Effects (Other Affected Industries, Supply of Inputs)
• How will production change the prices of capital, resources, and labor (looking
across all markets)? What share of total costs does this input represent for
affected industries?
• Will there be impacts on trade? Will the technology be exported or imported?
Are inputs exported or imported?
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• Will the change in prices of inputs, the new technology, or the old technology be
large enough to affect regional or national inflation levels? Employment patterns?
5.2.2 Demand for the Technology
5.2.2.1 Business as Final Consumer
Industries that adopt a cost-saving technology will reduce production costs, while
industries that are forced by regulations to adopt more expensive technologies will face
increased costs. The change in the price of one good will affect the firms that produce
complements and substitutes. New production technologies or new goods may also mean
increased competition for the labor, capital, and resources necessary to produce the new
technology and for industries using the new technology.
Identify why the technology might be adopted, and this will provide information on
how the company might expect the cost of production and quantity produced of its final
products to change with the introduction of the new technology.
WHY would a business adopt this technology?
• Is this technology mandated by regulations?
• Does this technology reduce production costs? Is it higher in quality?
• Will it give businesses a "green" marketing advantage (or other market niche)?
HOW?
• How will it change costs? Change variable costs? Change fixed costs?
• How will it change resource and capital requirements?
• How will it change labor requirements?
• How will it change prices of labor and capital?
• How will it change prices of final goods produced by the firm?
• How will it change the amount and composition of pollution produced?
• What are the consequences if wastes or product is disposed of improperly?
• How will it change the production of substitute or complementary goods?
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• Will the new technology change how the good is supplied to customers of final
products?
• Will this new technology enable the firm to use other complementary services or
goods?
5.2.2.2 Households as Final Consumer
New technology can affect consumer demand if it changes the relative prices of
goods, if new goods are introduced that are substitutes for or complements to existing goods,
or if it changes consumers' preferences (feelings or values) for goods (e.g., "green"
technologies may create new markets that cater to people who value the environment).
Identify why households would be willing to use the new technology and how
households would use it. Does the technology require a big change in lifestyle? Will it be
easy and convenient to use? It might be easier to think about households producing outputs
such as good health, recreation activities, earning money, transportation, and other "goods
and services." Just like a firm, the household will use different technologies to produce
household outputs.
WHY would consumers use this product?
• Is it cheaper than an existing product (dollars or time)?
• Does it allow them to do something new (it is a new product) or do something
better? Is it higher in quality?
• Do they want to do things that are good for the environment?
• Are they forced to by regulations (e.g., recycling)?
HOW?
• How will consumers use the product? Does use of the technology require a
significant change in lifestyle? Is it more or less time-intensive than the old
technology?
• Do adequate services exist to support use of the new technology? Is it easy to
use?
• How will consumers change purchases of other goods? Is the new good a
substitute or complement for existing goods?
5-12
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• How will it change the household's use of resources (time, money, other goods)?
• How will it change the household's production of pollution? If technology
changes the mix of pollutants generated by the household, are the new pollutants
easier or harder to dispose of? What are the consequences of disposing of the
waste improperly?
5.3 Worksheet for Economic System Questions with Sample Questions
Table 5-2 is a sample worksheet containing the questions listed above and some
sample questions that one could ask about a technology. This worksheet format is provided
as a sample for how the questions and information from Section 5.3 might be organized.
Depending on the technology or the goal of the assessment, alternative formats may be more
appropriate. The first column lists the questions, some of which are shortened versions of the
questions listed in Section 5.3. In the second column, each question can be assigned an
importance ranking. Not every question will apply to all technologies, and some issues will
be more or less important depending on the technology's characteristics. If more information
needs to be gathered about a particular issue, the assessor can note this in the third column.
Finally, the fourth column provides space for notes. Tables 5-3 and 5-4 are two of these
tables, filled out with respect to sample questions for fluorescent lightbulbs and biofuels.
5.4 References
Anderson, Curt L. 1987. "The Production Process: Inputs and Wastes." Journal of
Environmental Economics and Management 14(1):1-13.
Batz, F.J., K.J. Peters, and W. Janssen. 1999. "The Influence of Technology Characteristics
on the Rate and Speed of Adoption." Agricultural Economics 21(2): 121-130.
Brewster, David. 2000. End-User Financing of Solar Home Systems in Developing
Countries. Master's Project for Duke University Nicholas School of the Environment.
Geroski.P.A. 2000. "Models of Technology Diffusion." Research Policy 29:603-625.
5-13
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Table 5-2. Economic System Sample Worksheet
Question
Production of the Technology?
Regulatory climate?
Supply network for the technology?
Does an industry exist that produces this technology?
Is the industry competitive or concentrated? Vertically
integrated?
Industries that produce substitutes?
Industries that produce complements?
Resource Requirements
Resource inputs?
Other capital requirements?
Labor requirements?
Can key inputs be identified?
Scale/Start-up
Is there a minimum efficient scale? Will expected
demand exceed it?
Are there large start-up costs?
Are there barriers to entry from lack of materials?
Importance
(1 = Very Low ...
5 = Very High, or
NA)
Need More
Information
Notes
(continued)
-------
Table 5-2. Economic System Sample Worksheet (continued)
Question
Importance
(1 = Very Low ...
5 = Very High, or
NA)
Need More
Information
Notes
Waste Disposal
What wastes are generated from production?
How will wastes be disposed of during production?
During distribution?
Industry-wide/Economy-wide Effects
Prices and availability of inputs?
Demand for the Technology by Firms
Cost of using new technology higher or lower?
Mandated by regulations?
Green marketing?
How will use of the technology change use of other
resources, labor, and capital?
Will use of the technology reduce price of final goods or
increase (related to why the technology technology was
adopted—cost saving, green marketing, or regulation)?
How will amount and composition of pollution change?
Will use of the technology increase demand for
complementary goods or decrease demand for substitutes?
Will use of the technology change the way a company's
products are delivered to or used by customers?
Will use of the technology allow use of other
technologies?
(continued)
-------
Table 5-2. Economic System Sample Worksheet (continued)
Question
Importance
(1 = Very Low ...
5 = Very High, or
NA)
Need More
Information
Notes
Demand for the Technology from Consumers
Is it cheaper than existing technology or labor-saving?
Is the technology higher in quality?
Does it satisfy consumer preferences for environmental
lifestyle or status?
Does it allow the household to do something new and
different?
What is regulatory climate for use of new technology?
How will consumer use the new technology?
Will it require a change in lifestyle?
Is the new technology more or less time-intensive?
Does an adequate infrastructure exist to use/service the
technology?
How will it change household uses of resources (labor,
capital, resources)?
How will it change household's production of pollution?
-------
Table 5-3. Sample Worksheet for Fluorescent Lightbulbs
Question
Production of Fluorescent
Lightbulbs?
Regulatory climate?
Supply network for lightbulbs?
Does an industry exist that produces
this technology?
Is the industry competitive or
concentrated? Vertically integrated?
Industries that produce substitutes?
Industries that produce complements?
Resource Requirements
Resource inputs?
Other capital requirements?
Labor requirements?
Can key inputs be identified?
Scale/Start-up
Is there a minimum efficient scale?
Will expected demand exceed it?
Are there large start-up costs?
Are there barriers to entry from lack of
materials?
Sample Questions for
Fluorescent Lightbulbs
Existing lightbulb makers?
Are there subsidies for
production of fluorescent
lightbulbs?
Yes
How many firms produce
lightbulbs? Do they produce
other products?
Candles?
Electronic ballasts for lightbulbs?
Other technologies that can be
used with fluorescent lightbulbs?
How do inputs different from
regular lightbulbs?
Importance
(1 = Very Low ...
S = Very High, or NA)
Need More
Information
\
Notes
(continued)
-------
Table 5-3. Sample Worksheet for Fluorescent Lightbulbs (continued)
Question
Sample Questions for
Fluorescent Lightmbulbs
Importance
(1 = Very Low ...
5 = Very High, or NA)
Need More
Information
Notes
Waste Disposal
What wastes are generated from
production?
How will wastes be disposed of during
production? During distribution?
Does production generate different
wastes?
Are wastes hazardous?
Industry-wide/Economy-wide Effects
Prices and availability of inputs?
oo
Demand for Fluorescent Lightbulbs
by Firms
Cost of using new technology higher or
lower?
Mandated by regulations?
Green marketing?
How will use of fluorescent lightbulbs
change use of other resources, labor,
and capital?
Will use of fluorescent lightbulbs
reduce price of final goods or increase
(related to why fluorescent lightbulbs
technology was adopted—cost saving,
green marketing, or regulation)?
How will amount and composition of
pollution change?
Cost of retrofitting? Monthly cost
for use?
Are fluorescent lightbulbs
perceived as green products?
Use less air conditioning because
they give off less heat? Need to be
changed less often? Will all
normal lightbulbs be replaced or
just some?
Reduce energy costs?
Will fluorescent lightbulbs
produce other wastes even as
emissions decline? Are these
wastes easy/cheap to dispose of?
What if bulbs disposed of
improperly?
-------
Table 5-3. Sample Worksheet for Fluorescent Lightbulbs (continued)
Question
Sample Questions for
Fluorescent Lightbulbs
Importance
(1 = Very Low ...
5 = Very High, or NA)
Need More
Information
Notes
Demand for Fluorescent Lightbulbs
by Firms (continued)
Will use of fluorescent lightbulbs
increase demand for complementary
goods or decrease demand for
substitutes?
Will use of fluorescent lightbulbs
change the way a company's products
are delivered to or used by customers?
Will use of fluorescent lightbulbs allow
use of other technologies?
Will fluorescent lightbulbs allow
firms to use other complementary
energy-saving technologies?
Demand for Fluorescent Lightbulbs
from Consumers
Is it cheaper than existing technology
or labor-saving?
Is the technology higher in quality?
Does it satisfy consumer preferences
for environmental lifestyle or status?
Does it allow the household to do
something new and different?
What is regulatory climate for use of
new technology?
How will consumer use the new
technology?
Will it require a change in lifestyle?
Are fluorescent lightbulbs cheaper
to buy? Cheaper to use?
What kind of light do fluorescent
lightbulbs provide?
Are fluorescent lightbulbs
considered green?
Does it expand choice of lamps or
light fixtures?
Replace all the lights in the house?
Some of the lights?
Do fluorescent lightbulbs last
longer?
(continued)
-------
Table 5-3. Sample Worksheet for Fluorescent Lightbulbs (continued)
Question
Sample Questions for
Fluorescent Lightbulbs
Importance
(1 = Very Low ...
5 = Very High, or NA)
Need More
Information
Notes
Demand for Fluorescent Lightbulbs
from Consumers (continued)
Is the new technology more or less
time-intensive?
Does an adequate infrastructure exist to
use/service the technology?
How will it change household uses of
resources (labor, capital, resources)?
How will it change household's
production of pollution?
Need new lamps and light
fixtures?
How are bulbs disposed of?
N)
O
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Table 5-4. Sample Worksheet for Biofuels (Produced with Corn)
Question
Sample Questions for
Biofuels
Importance
(1 = Very Low ...
5 =Very High, or NA)
Need More
Information
Notes
Production of the Biofuel
How will production be financed?
Regulatory climate?
Existing supply network of customers
for biofuel?
Does an industry exist that produces
this technology?
Is the industry competitive or
concentrated? Vertically integrated?
Industries that produce substitutes?
Industries that produce complements?
Large agricultural companies?
Fuel companies?
Subsidies for producing biofuels?
Fuel companies have contacts with
gas stations; agricultural
companies do not?
Fuels industry?
Will the large agricultural
companies be vertically integrated
to grow corn and produce fuel?
Other fuels?
Makers of engines that run on
biofuels? Are there additives that
make biofuels work better?
Resource Requirements
Resource and energy requirements?
Capital requirements?
Labor requirements?
Can key inputs be identified?
Who will produce the com input?
Large agricultural companies?
Small farmers?
What will account for the largest
share of cost of production? Are
enough raw materials currently
produced?
(continued)
-------
Table 5-4. Sample Worksheet for Biofuels (Produced with Corn) (continued)
Question
Sample Questions for
Biofuels
Importance
(1 = Very Low ...
5 = Very High, or NA)
Need More
Information
Notes
Scale/Start-up
Is there a minimum efficient scale?
Will expected demand exceed it?
Are there large start-up costs?
Are there barriers to entry from lack of
inputs?
How will new technology be physically
distributed?
Do costs decline/increase with
greater production?
Expensive capital equipment or
technology? Expensive to
distribute?
Are there limited quantities of any
inputs? What are key inputs?
Using exiting infrastructure for
gasoline or will it require
modifications?
Waste Disposal
ts) What wastes are generated from
production?
How will wastes be disposed of during
production? During distribution?
Water pollution problems?
Expensive regulations about
proper disposal? Potential for
pipeline leaks?
Industry-wide/Economy-wide'Effects
Prices and availability of inputs?
Impacts on trade?
Impacts on inflation, regional or
national?
Impacts on employment, regional or
national?
What other industries use the same
inputs? At what point will the
increase in demand for corn lead to
price increases in com?
Will biofuels reduce imports of
oil? Will biofuels reduce exports
of corn?
Will price of gasoline change
significantly?
(continued)
-------
Table 5-4. Sample Worksheet for Biofuels (Produced with Corn) (continued)
Question
Sample Questions for
Biofuels
Importance
(1 = Very Low ...
5 =Very High, or NA)
Need More
Information
Notes
to
us
Demand for Biofuels by Firms
Cost of using new technology higher or
lower? Quality higher or lower than
old technology?
Mandated by regulations?
Green marketing?
How will technology change costs of
production, fixed and variable? How
will use of biofuels change use of other
resources, labor, and capital?
Will use of biofuels reduce price of
final goods or increase it (related to
why biofuels technology was
adopted—cost saving, green marketing,
or regulation)?
How will amount and composition of
pollution change? Are there serious
negative consequences from
mishandling waste?
Will use of biofuels increase demand
for complementary goods or decrease
demand for substitutes?
Will use of biofuels change the way a
company's products are delivered to or
used by customers?
Will use of biofuels allow use of other
technologies?
Used by company vehicle fleets?
Used in engines other than cars or
trucks?
Cheaper than gasoline? Subsidies
for use?
Requirements for government
fleets or new cars that use
biofuels?
Are biofuels perceived as "green"?
Will green consumers be willing to
pay more?
More maintenance on engines?
Specialized mechanics? Need to
purchase new cars or trucks?
Will biofuels produce other wastes
even as emissions decreased? Are
these wastes easy/cheap to dispose
of?
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Table 5-4. Sample Worksheet for Biofuels (Produced with Corn) (continued)
Question
Sample Questions for
Biofuels
Importance
(1 = Very Low ...
5 = Very High, or NA)
Need More
Information
Notes
Demand for Biofuels from
Consumers
Is it cheaper than existing technology
or labor-saving?
How will new technology change
purchases of substitute or
complementary goods?
Does it satisfy consumer preferences
for environmental lifestyle or status?
Does it allow the household to do
something new and different?
What is regulatory climate for use of
new technology?
How will consumer use the new
technology?
Will it require a change in lifestyle?
Is the new technology more or less
time-intensive?
Does an adequate infrastructure exist to
use/service the technology?
How will it change household uses of
resources (labor, capital, resources)?
How will it change household's
production of pollution?
For their cars? Other engines?
Is the biofuel cheaper than
gasoline?
Will biofuel change purchases of
cars? Amount of gasoline?
Is biofuel perceived as better for
the environment?
For cars, lawn mowers, others?
Will the car need gas more often?
Will it need more maintenance?
Does the car have to warm up
longer in the morning?
Do cars using biofuels need
special parts or mechanics?
Are cars that use biofuel more
expensive? Are maintenance or
repairs more expensive?
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SECTION 6
POLITICAL, INSTITUTIONAL, AND SOCIAL CONSIDERATIONS IN THE
ADOPTION AND PENETRATION OF GHG-REDUCING TECHNOLOGIES
This section of the methodology document is divided into three subareas: political,
institutional, and social. It addresses political, institutional, and social factors that can
encourage or create barriers to technology adoption and desirable social and institutional
results. Although political and institutional considerations are discussed separately, they are
not independent. Governments, which are institutions, are inherently political in
democracies; therefore, the political and institutional considerations may overlap. Each of
the subareas of this section contains definitions of terms used in the discussion of the
considerations. The issues for an assessor to consider are presented as a series of questions
intended to stimulate the thinking process. Each of the questions is accompanied by a
discussion relevant to the points made. Table 6-1, at the end of the section, contains the
questions relevant to each area as a tool to guide the assessment process and has blank
columns in which to note the relative importance of the considerations identified and where
additional information may be needed.
6.1 Political Considerations
Considering the political barriers and supports for a new environmental technology is
essential to understanding whether a technology is likely to be implemented successfully.
Although an environmental technology may benefit society as a whole by reducing pollution
in our environment and lowering various kinds of health risks and safety hazards, the
development and adoption of the technology could threaten (actual or perceived) the
livelihood of or simply reduce the profit earned for some members in the society and increase
it for others. The potential losers could be large corporations, certain socioeconomic
group(s), or even future generations. These actors, either they themselves or through their
spokespersons, understandably would use their political power to prevent the new technology
from being adopted. Therefore, the assessor of a technology needs to consider the potential
sources and magnitude of potential political oppositions as well as likely supporters of the
technology in assessing the likelihood of technology's success.
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The following questions and discussions assist in identifying important political
considerations.
6.L1 Is adoption of the technology likely to be affected by the current administration's
general stance toward the environmental problem the technology is designed to
address?
Adoption of technologies may be influenced by whether the current political
administration is prioritizing the environmental problem that a technology is designed to
address. Vehicles redesigned to operate on 100 percent biofuels can be expected to gain
widespread adoption if regulations are passed promoting them (such as requirements of a
certain fleet percentage running on biofuels) or if federal or state governments were prepared
to subsidize biofuels or biofuel vehicles or infrastructure. Conversely, an administration
unsupportive of global warming concerns is unlikely to provide such a boost for biofuels
vehicles.
6.1.2 Is this technology part of a country's national security agenda (e.g., reducing
reliance on imported oil)?
Reliance on foreign imports for vital energy sources has induced many countries to
combine energy policymaking with national security concerns (a war or an oil embargo could
obstruct energy supplies and interrupt vital economic, political, and social activities). By
developing technologies that reduce a country's reliance on foreign energy imports (albeit in
the long run), a country can increase its security. Under such a goal, technologies like
biofuels that can lower reliance on foreign energy imports may be seen as desirable from the
national security perspective. Some may also argue that GHG-reducing technologies can
reduce another type of threat to national security—an environmentally devastated society that
threatens the welfare of our future generations.
A technology assessor evaluating biofueled autos is likely to ask whether
development of a 100 percent biofuel vehicle (and supporting infrastructure) is likely to be
perceived as promoting national security. As described above, reducing reliance on foreign
oil sources could be considered part of national security and therefore might be assumed that
the national government might support and promote the technology, thereby accelerating
adoption of the technology. However, if current national energy policy is heavily invested in
independence in fossil fuel production, then alternative energy sources such as biofuels may
lack national support and promotion, and technology adoption will be assumed to be slower.
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6.1.3 Is developing this technology part of the country's trade policy agenda (more likely
to be a long-term trade policy goal)?
In the environmental technology arena, there have been cases where a country invests
in its technology development in the hope of dominating the export market for the technology
in the years to come. Japan, for instance, invested large sums into R&D of environmental
technologies in the 1980s with the aim.of monopolizing export markets for environmental
technologies. That goal has largely been reached; Japan now dominates markets for
environmental technologies in most parts of Asia (Southeast Asia in particular).
In essence, when a technology is part of a larger domestic policy package or helps
achieve more than one policy goal, by facilitating, for example, the goal(s) of trade policy,
trade deficit reduction, natural security policy, and even agricultural policy in the case of
biofuels, much greater political support for the technology can be garnered.
In the case of biofuels, if the hybrid fuel (use of 100 percent pure biofuel is less likely
than a biofuel-gasoline mix) were to dominate gasoline and became the main fuel for
transportation, national reliance on imported oil will decrease; Midwestern farmers will be
induced to produce more crops for exports and biofuel development; and this would, in turn,
benefit U.S. trade balance vis-a-vis the rest of the world and reduce U.S. trade deficits. In
developing countries with a large farm base, biofuel production could help meet their
economic development policy goal(s) by raising the income of farmers, improving the quality
of life for the population at large, and even reducing rural-urban migration problems.
6.1.4 Is this technology of the macro or micro type?
Macro technologies' attributes are centralized and large scale, have high economic
cost, and have larger environmental impact individually. Macro examples are thermal power
plants and dams. Micro technologies' attributes are decentralized and small scale, can be
acquired by an individual consumer, and have smaller environmental impact per unit. Micro
examples are passenger vehicles, refrigerators, TV sets, fluorescent lightbulbs, and fuel cells.
Depending on whether a technology is of the macro or micro type, it can be more
prone to encountering certain obstacles, be they resource availability related, financial,
environmental, or political in nature. Macro technologies, such as a large power plant, are
more demanding in terms of land and capital and financially. Advocates of renewable energy
technologies and micro projects such as smaller dams have used these arguments in the past.
The emphasis in this section is on political obstacles.
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In terms of land use, macro technologies may face different political and social
opposition depending on whether the planned site is rural or urban. In developing countries,
rural areas are inhabited mostly by low income residents who have little to no political
power; therefore, they cannot offer resistance to the technology. However, in recent years,
local and international environmental advocacy groups or nongovernmental organizations
(NGOs), with their voices amplified by local and international media, have become more
successful at helping local residents protest against the siting in their neighborhood of locally
unwanted/undesirable land use projects (LULUs) such as a power plant or a hazardous waste
facility (see Section 6.3 for a discussion of environmental justice and equity).
Macro projects are perceived to have a few advantages as well: engineers in
particular perceive a large project as a good umbrella testing case (the idea is that, if a wind
power plant of a large scale can work, smaller ones certainly will, but not necessarily vice
versa). In addition, politicians favor ostentatiousness or grandiosity (which helps raise the
profile of a city or country) and greater job creation. In terms of the environment, however, a
number of small plants rather than a mammoth project are more often than not less damaging,
both to the environment and to residents' physical and mental well-being.
Some technologies are micro themselves, yet they require large scale or scope of
supportive infrastructures for wide adoption/penetration. Vehicles that run on a biofuel-
gasoline hybrid are one example. Although the technology (a hybrid vehicle) is small and
affordable enough for individual consumption, hybrid cars alone are not a complete
technology. The cost of developing the infrastructure that will replace some of the current
infrastructure, not just the cost of developing the technology itself, also needs to be
considered when evaluating whether a technology is likely to be implemented and adopted. In
the case of biofuels, researchers have claimed that the costs of developing necessary
supporting infrastructures are reasonable or are not prohibitively expensive.
6.1.5 Who are the stakeholders? Consider disaggregating consumers or receivers of
technology by income level, age group, gender, and race.
A general list of stakeholder types, considering both developed and developing
country contexts, could include the following:
• political parties;
• governmental agencies;
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• manufacturing firms (e.g., producers of the technology and inputs to the
technology);
• commodity producers (e.g., petroleum industry, automotive industry, various
components of the agriculture industry);
• labor unions (e.g., United Auto Workers Union);
• environmental NGOs (e.g., Greenpeace);
• financial institutions;
• consulting firms;
• research institutions and organizations;
• state-owned enterprises (if applicable); and
• other interest groups such as minority organizations, or senior citizen
organizations, and citizens at large or consumers.
With respect to consumers, disaggregating them by income level and/or race will
facilitate analysis of the distributional consequences of a technology project or program.
In the case of biofuels, the main stakeholders include producers (farmers), consumers
(vehicle users, electric power users, consumers in general), oil companies, the automotive
industry, and environmental interest groups.
6.1.6 Who will be the main beneficiary of the technology: consumers, small producers,
capital owners, or farmers?
A relatively simple way of categorizing the beneficiaries of a technology is to identify
three general types of stakeholders: the producer, the consumer, and the environment. A
further disaggregation of stakeholder groups is needed, however, to facilitate a more
informative analysis of who gains and who loses. This information will help the assessor
identify potential sources of opposition and support (as well as perhaps to conceive
compensatory policy measures for potential losers to accompany the technology
implementation).
For the producers' group, for instance, specific types of companies that will gain and
lose depending on the degree of adoption of the new technology are producers of the
technology, producers of the inputs to the technology, producers of goods and services
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complementary to the technology, producers of substitute goods and services for the
technology, employees (current, displaced, and potential new hires), capital owners of various
productions, and stockholders of producer companies. The technology assessor would want
to look at whether these arrangements would be desirable or undesirable. For instance,
would small businesses tend to gain or lose? Would the gains/losses tend to concentrate
market power with a few companies, or would it increase competition? Would job
displacement be concentrated in regions with diverse economies where displaced workers
would be expected to find new jobs in their current communities? Or would the
displacements likely lead to disintegration of social fabric in existing communities?
A similar analysis can be made for the consumer and the environment stakeholder
groups. Direct gains/losses should be considered, then indirect gains/losses generated by
changes in the environment at large should be evaluated. Doing this requires selecting a
welfare indicator(s) for measuring individual well-being. There are several possible
measures for or indicators of individual well-being, ranging from the more objective (not
necessarily better) indicators such as income (can be annual or lifelong), life expectancy, or
quality of life index, to the most subjective measure, which basically asks individuals how
happy they think they are (i.e., stated level of well-being.).
For example, use income as a proxy measure for individual well-being. If a
stakeholder enjoys greater annual income by switching to a different means of transportation
(the hybrid fuel), then that person is considered better off.
For the consumer group, disaggregation by income level, race, and/or age would make
more apparent the different benefit and cost implications.
6.1.7 How are technologies linked to changes in competitive advantage for various
political groups ?
After having identified all the stakeholders, the assessor should determine who would
gain and lose and by how much as a result of the new technology. This determination
requires an assumption of a certain level of technology penetration or could involve assuming
varying levels of penetration. The scenario with this level(s) of technology penetration would
be compared with a baseline (the business-as-usual scenario, if a long-term comparison is
made).
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If the development of a new technology, say biofuel development, could drive certain
industries out of business, then income losses experienced by those who are the owners of
now-obsolete capital and those who have become unemployed must be considered.
A sense of whether a stakeholder group will be affected negatively or positively may
be gained by doing a back-of-the-envelope type assessment. Using hybrid cars as an
example, their impact on consumers of different age groups and income levels will
understandably be quite different. Senior citizens are not likely to be a direct beneficiary of
hybrid cars, due to the small and compact nature of hybrid cars and the lack of networking
infrastructures (e.g., repair, maintenance, regulatory information) for hybrid cars. The latter
factor means higher maintenance costs and information costs, which will also prevent lower-
income consumers from driving the innovative hybrid cars. However, both groups can be
expected to see welfare gains in the long run resulting from decreased pollution. In general,
the often high cost associated with technologically advanced/sophisticated products is the
main barrier preventing low-income people from directly benefiting from innovative
technologies.
In the case of biofuels, one can predict that oil companies will lose compared to the
status quo. Chemical companies and certain other industries that can use biofuel-derived
inputs as replacements for current inputs could gain or lose depending on the cost
implications for the entire production life-cycle (which means taking into account probably
lowered cleanup costs due to lower environmental hazards). Genetic engineering firms (for
agricultural research mainly) would gain from greater funding for research. Research
institutions that work on similar and/or related issues will also benefit. Environmental NGOs
will benefit if they believe that the environment will gain.
Government will lose in the short-run1 in that it will have to subsidize biofuel
research, development, and demonstration. In the long run, the government or the national
treasury could do better (assuming the new fuel is taxed at a level similar to gasoline) for two
possible reasons:
'This implies that the time frame chosen for evaluation is an important and often determining factor with regard
to who gains and who loses and by how much. Therefore, the assessor must determine an appropriate time
frame before evaluating before and after stakeholder welfare.
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• rise in tax revenue due to higher income earned in the midwestem U.S. farming
communities and
• reduction in trade deficits.
Consumers might have to pay a little more in the beginning for the hybrid fuel, but whether
they gain or lose could be gauged from their stated level of well-being, which could actually
increase.
If the assessor is evaluating the potential political barriers of an environmental
technology in an international context, the two questions in Sections 6.1.8 and 6.1.9 are
relevant.
6.1.8 Is this an industrialized or a developing country?
An industrialized country is more likely to have well-established infrastructures, from
legal (e.g., taxation, contracts, environmental regulations, land use regulations, land use
codes), market infrastructures (e.g., spot markets), financial institutions (loans, insurance),
and communications networks, to research organizations and facilities. Industrialized
countries are wealthier and therefore better able to invest in new technologies via capacity
building and/or new production activities. In industrialized countries, government and the
private sector are more likely to work together to explore new technologies, via joint R&D
and public-private partnerships of different kinds.
6.1.9 Is the political system generally considered to be democratic (indicator can be the
number of active political parties) or authoritarian?
The important issue related to the question is political stability. Political stability is
an important criterion for investors. Asian countries are known for high savings rates and
therefore less reliance on foreign investments. However, in recent years, given the rapid
economic growth and infrastructure development, even these countries began to rely on
foreign investment as well. Nevertheless, because of less-established legal and market
groundwork and what is often an alien business culture to foreign investors, the importance
of political stability becomes all the more pronounced.
For some, government-guaranteed (underwritten) investments were able to placate
foreign investors' fear of arbitrary reneges. Over the years, however, foreign lenders and
international lending institutions like the World Bank and International Monetary Fund have
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begun to demand greater transparency and fairness in the operation of economic and political
systems, as well as fewer stipulations on foreign investments.
Greater transparency is believed to be the best way to address what Krugman (1999)
labels crony capitalism (govemment-big business cooperation) or, more simply, corruption,
which was much more pervasive prior to the financial reforms instituted to deal with the
Asian economic crisis. By and large, corruption tends to be less common in democratic
systems as opposed to elite-ruled societies where decisionmaking power lies in the hands of a
few because of their political standing and/or ownership of wealth.
6.2 Institutional Considerations in the Adoption and Penetration of GHG-Reducing
Technologies
Institutions are norms, beliefs, and practices that influence human behavior, practice,
and expectations shared by every member of the society. Definitions of an institution can
also refer to a framework of behavior: institutions interact, channel, or guide behavior
(Groenewegen, 1996).
According to the literature, institutions exist for the specific reasons of reducing
information costs and transactions costs incurred during each economic or political exchange
between individuals and markets, and between individuals and the state (e.g., their
representatives or elected officials). Information costs are incurred by individuals to find out
who has what and to get the information about relevant parties' tastes. Transactions costs are
costs to measure and enforce contracts.
Formal institutions refer to rules and structures, whereas informal institutions
encompass norms and cultures. For an environmental technology, formal institutions of the
rule's form would include environmental regulations and codes, international conventions,
treaties, and agreements. Formal institutions of the structure's form would include agencies
like EPA (federal and local); the Department of Energy (DOE); the Intergovernmental Panel
on Climate Change (IPCC); financial institutions such as banks and insurance companies;
utilities; energy production, processing, and reprocessing industries; technology producers;
and manufacturers of inputs to the technology.
The influence of informal institutions on people refers to the cultures, norms, and
values that shape people's preferences and expectations. Preferences develop over time and
become habits or even cultures that are difficult to change. Cultures and customs developed
could encourage or discourage the adoption and diffusion of a technology.
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In the increasingly environmentally aware culture of the United States, for instance,
buying organic produce, which only several years ago was considered somewhat highbrow,
has become fairly popular.2 Similar awareness has raised willingness among consumers to
pay a premium for environmentally friendlier analogs of traditional, large item consumer
products, from cars to household appliances.
The following questions and discussions are intended to assist in identifying
institutional considerations that will impact the success of technology implementation and
subsequent adoption, and which may be influenced positively or negatively by adoption of
the technology.
6.2.1 What are the formal institutions barriers to adoption/diffusion of the technologies?
Institutional barriers to technologies can exist for three reasons:
• An institution might construct barriers if it feels its well-being is threatened by a
new technology (see the example in the following paragraph).
• An institution prevents itself from adopting the technology because of a lack of
human, technical, and/or financial resources.
• Market imperfection barriers might exist.
These three types of institutional barriers are described in greater detail below.
The first type of barrier could be set up by an institution that feels its interests are
somehow harmed by the development of a new technology. For instance, in 1995 a powerful
research organization in a country used its political power to successfully stall a World Bank-
funded fluorescent light pilot because another local research organization had been chosen to
be the collaborating local research entity.
The barriers could also arise from within-institution resistance to a new technology.
Institutions are often potential receptacles of new technologies themselves. However, they
often experience technological lock-ins and path dependence that prevent them from adopting
the newest technology.
2Perhaps more affordable as well because of the rise in income that the population has enjoyed in the last
several years.
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• Technological lock-ins may occur when, for instance, a federal agency develops a
performance standard based on a particular technology in use today. Unless those
performance standards are changed, the firms or the buyers of technologies will
continue to favor the technologies that were used to generate those standards.
Indeed, even when engineers develop improved technologies that satisfy higher
performance goals, they may be unable to find buyers of their technologies who
fear risking noncompliance with the statutory requirements.
• Path dependence essentially points to the slow adjustment of institutions.
Institutions often face multiple driving forces. When adjusting, there are lags,
filters, and buffers that slow the speed of adjustment. But in some situations there
is long-time resistance to change and then sudden change.
Institutional barriers could also refer to those implicitly and/or explicitly set up by the
existing economic structure. This type of barrier can result from inequitable access to capital
and information, obsolete and restrictive regulations, and/or split incentives.3 This category
of institutional barriers is called market imperfection barriers.
6.2.2 What are the direct and indirect influences of institutions (formal and informal) in
shaping a technology?
Direct influences arise from formal institutions (they can be of the structure and the
rule types), which, as alluded to above, would include entities such as financial institutions,
governmental agencies, rules and regulations, international conventions and treaties, and so
on.
A caveat is warranted to clarify where markets lie relative to institutions; a market is a
place where structures or institutions such as firms and government entities come to interact
with one another under the regulatory control of rules and laws. Markets can develop certain
characteristics (e.g., monopoly, cartels, incentives for bad loans) that encourage or discourage
the implementation of environmental technologies. In other words, market is a forum where
a great number of institutions and actors transact and enter into all kinds of contracts with
each another. It is not an institution itself.
3In the case of rental housing, for instance, the owners would have disincentives to retrofit the apartments with
energy-saving technologies (unless they can charge higher rents, which is difficult in a competitive
market), whereas the renters would enjoy lower energy bills, which would result if such technologies were
installed, hence the split incentive.
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Indirect influences of institutions on technology can come from both formal and
informal institutional sources. Indirect formal influences can come from macro economic
factors (e.g., inflation, interest rates, the unemployment rate), rules aimed at influencing a
specific activity but have indirect effects on the technology concerned (e.g., labor laws,
capital investment rules), and government measures or policies to promote technological
change and investment. The last category warrants more illustration.
Government measures to improve the environment for technological change and
investment are often as important as direct approaches (e.g., major educational investment,
corporate tax law as tax credits for investments and rapid depreciation). Governments can
also subsidize (or use direct grants to fund) R&D expenditures. The power of a government
as a purchaser is yet another way to accelerate technological change and development.
Governments can speed up the diffusion process for some products by specifying them in the
requirements for products purchased by the government (requires a large purchase, perhaps)
(Office of Technology Assessment, 1981).
Direct and indirect informal influences could arise from behavioral choice criteria and
demographics factors. These informal influences are further illustrated in Section 6.3.
6.2.3 What institutional factors can stall a technology project?
Depending on the type of technology and technology development effort (a pilot
effort or a programmatic, more systematic effort), the enforcement bodies involved vary (e.g.,
federal, local, or both; private involvement or not), as will the accompanying advantages and
disadvantages. For pilot projects, government entities are usually the main, if not the only,
sponsoring agent as well as the implementer.
In recent years, because of drastic government funding cuts, and thus reduced funding
for governmental research, development, and demonstration, public-private research,
development, and demonstration partnerships have become more necessary. Such a
phenomenon can be deemed positive since private-public partnerships in technology
research, development, and demonstration can result in a wider demonstration effect, less
trouble with funding and resource shortages, creative combinations of private and public
capabilities, and (some would say) often decreased costs and improved performance. As an
Office of Technology Assessment (1978) study contends "While government performance of
basic research has made many outstanding contributions to industrial innovation, evidence
shows that Government development per se of new products and processes has often been
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overtaken by the rapid pace of innovation in private industry where superior knowledge of
the production process and product design prevails."
Some ways in which formal institutional, structures, and rules could stall the
development of a technology (biofuels are used as an example) are as follows:
• Self-preserving institutions create barriers: Oil companies and chemical firms
would engage in lobbying efforts against the technology.
• Within-institution barriers: Government procurement policies, industrial
producers not ready to adopt hybrid fuels, human and/or resource limitations are
examples.
• Market barriers: Existing rules and regulations could directly or indirectly
discourage widespread adoption of biofuel-gasoline hybrids or biofuel derivatives.
Low gasoline prices, not reflecting the environmental costs of using gasoline,
could also work against greener technologies since the incentives to seek
substitutes for gasoline are curtailed.
6.2.4 Some within-institutional barriers, such as the lack of a skill base, may not impede
adoption as much as other barriers.
The development of a particular project will not be possible unless an adequate skill
base exists or can be developed. This can be a problem even with simple projects, although
the skills needed sometimes can be taught rather easily. In the case of large municipal
projects, even the expertise or skill base needed for planning the project or determining its
feasibility can be beyond the means of a given community or company.
This problem may not impede technology adoption if the implementing body is likely
to address the need for a skill base. Skill transfer to a user group (rather than technical
assistance of outside experts) may particularly support adoption, since the skill base they
develop will remain in the group after the completion of the project. The following represent
a range of options a technology assessor might look for to see if technical assistance is likely
to overcome the skill gap:
• Workshops are effective for simple projects, particularly projects individual
homeowners or farmers will build and are successful in demonstrating the
technology in the local community and stimulating additional installations.
• Training programs and seminars can expose local residents to a wide variety of
potential applications and provide valuable skills.
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• One-on-one technical assistance from organizers and outside experts is useful in
helping farmers to build solar installations in Nebraska and organize a farmer's
market in Louisiana. The extension of existing DOE and U.S. Department of
Agriculture programs could be used as a mechanism for this form of assistance.
• Computer models and other planning aids allow small communities to conduct
low-cost site evaluations and feasibility studies for small-scale hydro power
projects, farmers' markets, and community health care centers. Similar technical
and organizational guides for energy-efficient housing and farm systems,
resource-recovery systems, and wastewater treatment facilities would allow other
communities to conduct their own evaluations and planning, without the need of
extensive federal involvement or funding.
• Expert assistance panels, like the teams of technical, financial, marketing, and
institutional specialists provided to state and local governments through EPA's
Technical Assistance Panels Program, might be useful in promoting the
consideration, adoption, and construction of local projects for wastewater
treatment, energy generation, and health care.
6.2.5 Who is (are) the implementing body (bodies) for the technology?
For example, in a pilot project, a government agency would implement the technology
(the lead agency could be at the federal or local level). The agency would conceptualize the
pilot project, oversee the development of a feasibility study, seek funding sources or
explore/compare multiple funding vehicles, and be responsible for training and disseminating
information. Often other agencies are involved at different levels of government, and
sometimes international collaboration occurs as well.
For an energy pilot such as a solar or a hydro power pilot, the agencies involved could
include DOE, federal- and state-level environmental protection agencies, even the
Department of Agriculture (when, for example, a solar greenhouse project could be combined
with a greenhouse project that generates agricultural produce), and the Army Corps of
Engineers. Under DOE, one or more offices/energy programs could participate in the pilot.
The fact that DOE, like all other executive agencies, needs to answer to Congress to obtain
funding implies Congress' involvement, although less directly, in a pilot for solar or hydro
power as well. The President's office might establish special programs or task forces as well,
such as the President's Global Warming program involvement. As a 1981 Office of
Technology Assessment technology assessment report contends: "Today, a complex set of
rules, regulations, and institutions govern the development of hydroelectric power."
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When the private sector is involved as the producer of the pilot technology, a
financier, or consultant firm, considering the power dynamics between the public agency
(agencies) overseeing the pilot and the private entities is important.
For biofuels, the implementing body would probably be DOE. Other implementing
entities could include the private sector and research institutions. It is difficult to forecast the
power dynamic.
6.2.6 What does the decisionmaking structure surrounding the adoption of the
technology look like (recommend a decisionmaking flow chart)?
This question involves linking all the involved agencies and private entities in a flow
chart to make apparent the decisionmaking process from the beginning of the project to the
end, which implies feedback loops and two-way arrows.
6.2.7 Does the implementing body have political backing for this technology? Does it
demonstrate leadership and enforcement determination? Does it have
accountability and managerial autonomy?
Time and again, evaluations of technology development projects show that the most
important institutional factor for the successful implementation of a technology program is
the commitment of the lead agency. Knowing whether this commitment is present can guide
the technology assessor in understanding whether the technology is likely to be successfully
implemented. The factors discussed in the following paragraphs may help in identifying the
lead agency's commitment.
In successful development efforts, other agencies may give the project limited
support, but they do not constitute a large enough opposition to obstruct the implementation.
The nonstructure type of formal institutional barriers such as rules (e.g., building codes,
Occupational Safety and Health Administration regulations, local and federal regulations)
also do not pose serious obstacles to the development of the project.
In successful projects, the lead agency often has a general commitment to exploring
innovative ways to respond to the needs of its constituents. Sometimes, to achieve successful
implementation, the lead agency needs to demonstrate extra leadership and enforcement
determination. In other words, the lead agency or agencies involved need to be prepared to
fight for the project as well as use their political assets should obstacles arise. The absence of
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such willingness and determination could lead to the early deaths of well-conceived projects
due to small but concentrated political opposition.
When a lead agency does not have accountability and managerial autonomy, it cannot
make decisions on its own, so it yields to its superior office(s) who may act on political rather
than technical considerations related to the project. In this case, not only is the efficiency in
decisionmaking compromised but so is the quality of the project itself.
6.2.8 What are the current legislatures, codes, and standards influencing this
technology? What are the anticipated trends of current legislation?
Many rules, regulations, codes, and standards directly and indirectly affect a new
technology. For a renewable energy project for instance, the directly relevant rules include
• the Federal Power Act of 1920,
• the Public Utilities Regulatory Policies Act of 1978, and
• the Energy Security Act of 1980.
Mapping out the direct and indirect rules and regulations surrounding a project would
inform the assessor of the limiting and supporting factors surrounding the design and
implementation of the pilot. The assessor can use this information to assess likelihood of
successful implementation and adoption of the technology.
Codes and standards refer to existing codes and guidelines such as building codes,
waste management guidelines, etc., that would influence the design of the pilot project.
Indirect rules or regulations could be overarching regulations that have an impact on all kinds
of policies; they include for instance rules and regulations governing economic development,
land use, and infrastructure financing. They could also include rules and guidelines for more
specific activities that are upstream or downstream to the technology of concern or for
regulating the production of any input to the technology.
Sometimes there are reasons to expect changes in current legislation or codes.
Accounting for possible changes or the uncertainty in the current regulations/rules is also
important when considering potential barriers to adoption.
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6.2.9 Who is (are) the financial institution(s) involved in financing the technology?
The type of financing for a new technology will influence whether it is successfully
implemented and may also influence how widely it is adopted. Possible financing vehicles
include government grants, subsidies, stocks, bonds, venture capital, or a combination of two
or more of the above; payback arrangements also vary. Both domestic and international
lenders could be involved, and the assessor needs to have a sense of their relative ratio.
Regardless of the type of financing vehicle, financial institutions need to be involved.
Financial institutions, such as banks, investment companies (e.g., a mutual fund company),
insurance companies, and international lending organization (e.g., the International Monetary
Fund, the World Bank, the Asian Development Bank), are entities involved in the borrowing
and/or lending of money. Financial institutions, except for the international lending
organizations noted above, are typically reluctant to fund innovative projects. Therefore,
government financial assistance or, for the developing countries, assistance from the
International Monetary Fund, World Bank, or Asian Development Bank, is often necessary
for new technology development projects.
Government financial assistance could come from local and/or federal governments.
Some of the technology development projects have the virtue of low cost, which allows them
to be developed by local communities. Some of the large projects, however, involve initial
investments or economic risks that could be too great for some communities to bear without
financial assistance. Given the potential benefits for the society as a whole of developing
innovative GHG-reducing technologies (e.g., for delivering electricity), the federal
government may intervene and reduce the financial risks and burdens the technologies
impose on local communities.
For a technology development project, replication of the project in other parts of the
country is the next step. The cost of replicating is likely to be high for a high technology
development project; therefore, government assistance may again be needed. The Office of
Technology Assessment (1981) study discusses several ways in which the federal
government can help hold down the cost to the local community and encourage adoption,
when assistance is necessary. These ways can be divided into indirect and direct. They
include, but are not limited to, the following:
• Options for indirect federal financial assistance:
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— Technical risk reduction: Efforts to gather and disseminate reliable
information on the technologies can reduce the financial risks of the projects
and prevent costly planning errors.
— Financial risk sharing: Risk sharing might include risk guarantees for
correcting facilities that do not work properly (available under EPA's
Innovative and Alternative Technology Program) or tax-free bonding for
municipal projects. These types of assistance might encourage the
consideration of alternative technologies.
— Tax credits and other incentives (e.g., the residential energy credit): These
might encourage the adoption of several of the smaller technologies (current
Internal Revenue Service guidelines do not allow credits for attached solar
greenhouses; extension of credits to include farm installations might also
promote the more rapid adoption of biogas digesters and on farm solar
installations).
— Investment tax credits and accelerated depreciation: These types might
encourage the commercialization of some of the technologies and the creation
of small local businesses to produce and/or install necessary equipment.
— Stimulating markets: This approach, implemented through federal
procurement guidelines, like those for recycled steel, might ensure a market
for locally grown produce or for materials recovered from municipal waste.
• Options for direct federal financial assistance include the following:
— Provide short- and medium-term loans and grants for long-term planning and
front-end costs (i.e., feasibility and market studies);
— Provide long-term financing options for community projects with favorable
life-cycle costs; projects that might otherwise have to be financed with short-
and medium-term debt; and
— Establish financial intermediaries authorized to make direct loans to
community-based AT projects, to spread risk and reduce information and
transaction costs (Office of Technology Assessment, 1981).
Returning to the illustrative example of biofuels, with regard to financing,
government subsidies would likely be needed in the research stage for process and perhaps
engine development. Government funding, however, is more subject to changes depending
on political winds and economic situations. Alternately, a government mandate that engine
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and gasoline producers develop a biofuels line of products could shift the costs to the private
sector.
6.2.10 Are there any international treaties, conventions, and/or agreements influencing
this technology?
International R&D or research, development, and demonstration to develop green
technologies can lead to an increased drive and greater opportunities to implement new
technology pilots/programs. Certain international treaties, conventions, and agreements are
more specific and aggressive in prescribing technological solutions than others. For instance,
the IPCC has set target dates for stabilizing CO2 emissions for its signatory countries. If the
technology assessor is working in the context of a signatory country, she or he might expect
to see more support for disseminating or subsidizing the technology compared to if she or he
were working in the context of a nonsignatory country.
6.2.11 What is the role of the NGOs in this effort? If more than one, do they differ in
their stance on this technology effort? If so, how do they differ?
An NGO is any nonprofit, voluntary citizens' group that is organized on a local,
national, or international level. NGOs are task-oriented and driven by people with a common
interest. They perform a variety of service and humanitarian functions, bring citizen concerns
to governments, advocate and monitor policies, and encourage political participation by
providing information. Some NGOs focus on specific issues, such as human rights, the
environment, and/or health. Some of them provide analysis and expertise, serve as early
warning mechanisms, and help monitor and implement international agreements (ngos.net,
2000).
Environmental NGOs do not represent a monolithic viewpoint. The technology
assessor might want to know if the technology in question is promoted by organizations who
position themselves squarely in the political center or those that prefer to promote their
agenda from a more adversarial position. Awareness of where environmental NGOs stand
may give a sense of how mainstream a technology is considered to be and therefore provide
some indicator of barriers to adoption and support for it.
Environmental NGOs over the years have become more powerful in influencing
public policies. Environmental NGOs such as Greenpeace and consumer interest advocates
like PIRGs have become important watchdogs and spokespersons for environmental and
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consumer well-being, interests not represented by a price tag and therefore "nontradeable" on
the market unlike other goods and services.
With their rising influence in the political arena, the NGOs can often affect the
success and failure of governmental programs. In assessing likely success of a technology
development, analyzing the possible reactions from the relevant NGOs is important in
forming expectations about the support and opposition for programs to promote the
technology and therefore the likelihood of successful implementation and possibly the extent
of adoption.
6.3 Social Considerations in the Adoption and Penetration of Technologies
Three key concepts pertain to social considerations of technology:
• focal vs. nonfocal function of a technology
• nonneutral nature of technology
• nonaccidental nature of technology
"Focal function" refers to a technology's ostensibly intended purposes. "Nonfocal"
then denotes the accompanying additional, but often recessive, functions, effects, and
meanings. An old technology may go beyond fulfilling focal function and therefore be hard
to replace by a new technology that better meets the focal function alone (Winston and
Edelbach, 2000). For instance, the automobile provides the focal function of transportation.
This function is accompanied by a raft of nonfocal functions, such as self-expression (red
convertible driver vs. a minivan driver), expression of social status (luxury car drivers), and
hobby activities (seen in old-car enthusiasts and amateur auto racing).
The technology and society author Corlann Gee Bush (2000) writes: "to believe that
technologies are neutral tools subject only to the motives and morals of the user is to miss
completely their collective significance." Tools and technologies have what Bush describes
as valence, a bias or charge analogous to that of atoms that have lost or gained electrons
through ionization. The following is a direct quote from Bush where she further illustrates
the concept of valenced technologies:
A particular technological system, even an individual tool, has a tendency to
interact in similar situations in identifiable and predictable ways. Particular
tools or technologies tend to be favored in certain situations, tend to perform
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in a predictable manner in these situations, and tend to bend other interactions
to them. Valence tends to seek out or fit in with certain social norms and to
ignore or disturb others.
Guns, for example, are valenced to violence; the presence of a gun in a given
situation raises the level fo violence by its presence alone. Television, on the
other hand, is valenced to individual on; despite the fact that any number of
people may be present in the same room at the same time, there will not be
much conversation because the presence of the TV itself pulls against
interaction and pushes toward isolation. Similarly, automobiles and
microwave ovens are individuating technologies while trains and campfires
are accretionary ones. (p. 73)
Another author conveys a similar message with the statement: "Although technology
is neither wholly good nor wholly bad, it has both positive and negative effects, and it usually
has the two at the same time in virtue of each other" (Mesthene, 1970, p. 26).
Technologies do not just appear and happen; they are contingent social products. The
process by which one set of designs rather than another comes to fruition is influenced by
prevailing social structures and forces, including the preexisting technological order.
However, this process also reflects implicit and explicit social choices, including political
negotiations or struggles.
Although today people think of the guiding impulses behind technological
development as necessarily being profit, convenience, or military advantage, throughout
history religious or aesthetic motivations have often been just as significant (Winston and
Edelbach, 2000).
Three main areas of social factors pertain to technology adoption:
• population demographics
• social barriers to technology adoption/penetration
— individual psychological factors
— interaction between individual and group psychologies and influences of
informal institutions (e.g., cultures and norms)
• impacts of technology on society
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— environmental justice and equity
— second and third generation impacts
6.3.1 What is the relationship between population demographics and technology?
Webster's defines demographics as "a statistical study of human populations."
Population demographics concern the size and composition of a population. Population
composition refers to the age structure as well as the socioeconomic makeup of a population.
The age structure of a population is usually represented by what is called a population
pyramid. The shape of the population pyramid is closer to uni-width for the more developed
nations and more triangular in shape for developing nations.
Growing populations in various parts of the world in conjunction with rapid depletion
of environmental resources and continued endangerment of biodiversity are reasons for
developing more efficient and cleaner technologies. Although the consumption of fossil fuels
seems innocuous at the individual level, when we aggregate the individual effects of a large
number of people driving motor vehicles that emit pollutants, the outcome is problematic and
harms the quality of life of each member of the society. This is termed "public harms of
aggregation" by McGrinn (2000); essentially, individually innocuous behavior can, when
aggregated over a large group, yield a significant, noxious outcome.
Applying demographics to the case of assessing the 100 percent biofuel vehicles, the
assessor will ask whether predicted increases in population are likely to lead to an increase in
drivers. That information, combined with assumptions about technology penetration levels,
guide the assessor in identifying likely impacts of biofuel vehicles. Assuming 100 percent
replacement of gasoline by a fuel of 100 percent biofuel, whether there will be substantial
reduction in CO2 emission from vehicles or not will depend on the number of drivers on the
road and the mileage driven. The demographics consideration implies that if the number of
drivers increases significantly, biofuel-powered vehicles may produce no real aggregate
improvement in CO2 emission, although one would expect to see an improvement compared
to the baseline with gasoline-powered vehicles only.
Population composition also influences technology policymaking. Countries with an
aging population structure (growing percentage of people 55 or older, often a result of a baby
bust after a baby boom as in Japan is a trend witnessed in many developed countries) and
countries with a large number of young people (a case more with developing nations) would
tend to invest in different types of technologies appropriate for their population base. The
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dominating trend, however, is that populations in every world region are getting old. This
implies more efforts should be devoted to developing technologies benefitting older .
populations.
Socioeconomic composition of a population will also affect the adoption and impacts
of a new technology such as fluorescent lights. Individuals with limited incomes typically are
less likely to be able to invest in higher-priced goods, even when those goods might save
money in the long run. In the case of compact fluorescent light bulbs, the relatively high cost
of a compact fluorescent bulb may place it out of reach of a consumer with limited cash flow,
despite the long-run cost savings of lower energy consumption and longer bulb life. A
relatively low income population therefore would not be expected to adopt this technology
readily unless some subsidy or other incentives were provided.
6.3.2 What are the individual psychological factors influencing the adoption decision of
a new idea or product?
One factor influencing the adoption decision of a new idea or product is perceived
risk. In social psychology, perceived risk for a product is based on an individual's integrated
evaluation of the financial, physical/safety, and psychological demands (learning and effort
required to use the product: technology goods require higher efforts and thus are higher in
psychological demand). A product could be psychologically helpful (not demanding) if it
raises the individual's social status and increases the individual's sense of well-being. A
product that is demanding in all areas is considered high-risk or high involvement and faces
greater barriers.4 A biofuel powered vehicle is a high involvement good.
Adoption of a new technology occurs only after a potential consumer goes through
three stages of understanding: basic awareness, knowledge, and comprehension. A basic
awareness of the greenhouse effect and the global warming problem as well as of the
technology, for instance, might be the first step to adopting a GHG-reducing technology
(assuming the technology does not present other advantages that would make the consumer
want to adopt). Public and private media campaigns and information dissemination are
among the mechanisms that will allow the individual to obtain more knowledge on the
relevant issues to inform consumption decisions. However, the information disseminated
needs to be conveyed in a comprehensible way for the individual.
"An example of a low involvement product is toothpaste. Choosing a toothpaste usually requires very little
evaluation because of its low cost, low safety risk, and low psychological demand.
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The consumer must then move from having the knowledge to acting on the
knowledge and acquiring a new product. The layer in between knowledge possession and
taking action is called attitude. Social psychologists state that it is necessary for the
individual to develop a favorable attitude (a positive emotion) toward the product; typically,
the higher the risk (or involvement) of the product, the stronger the favorable attitude needs
to be. One way a positive attitude toward a product may be induced is to have consumers use
the technology on a trial basis. Many companies, for example, give away samples of their
products to achieve this end. From the trial usage, the individual may engage in repeated use
of the product and slowly develop a commitment to the product by adopting the product. The
next level to adoption is loyalty and even promotion of the product.
Often, companies and public relations firms would focus their resource-demanding
campaigns (e.g., running advertisements, free installments, trial runs) on their primary target.
Depending on the product, a set of individuals with certain traits could be the most likely
opinion leaders or first generation adopters of the product. With respect to biofuels and
compact fluorescent GHG-reducing technologies, environmentalists would be the most likely
opinion leaders or first generation adopters, particularly of micro technologies.
6.3.3 Will interaction between individual psychology and group psychology help or
hinder technology adoption implementation (i.e., use by the public)?
Individuals' demand for high-involvement products depends greatly on who their
reference group is and the consumption behavior of this group. An individual's reference
group essentially extends from those closest to them (i.e., family and friends) to neighbors,
colleagues, and lastly to public opinion. Through intergroup interaction as well as through
observation alone of members of one's reference group, individuals obtain information as
well as develop attitudes for certain products (technologies). When an individual is faced
with high peer pressure to adopt a product, he or she is likely to adopt the positive group
attitude (positive one) toward the product.
To assess the likely impact of group/individual psychology on adoption of
100 percent biofueled vehicles, an assessor might turn to marketing literature regarding
consumer acceptance of features like automotive cost, novelty, and costs-to-fuel. The
assessor would then compare these acceptance trends with the features likely to be found in a
biofueled vehicle.
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6.3.4 Are there cultures and norms that would influence an individual's willingness to
adopt a new technology? Will the technology influence social norms and cultures?
Informal institutions, or cultures and norms, create incentives and disincentives for
people to adopt a certain attitude and behave in a certain way for them to function smoothly
in the society. Given their shared nature, cultures and norms, therefore, shape people's
expectations and restrict what people can or cannot do just as formal institutions do. Cultures
and norms (or informal institutions) usually change very slowly; however, there are also
exceptions.
The technology assessor would expect adoption of 100 percent biofuel vehicles to be
influenced by such cultural factors as
• Expectation of convenience in transportation fueling. Limited fueling location
options may at first retard adoption of biofuel vehicles as compared to
conventional gasoline engines that can be fueled in virtually limitless locations
across the United States.
• Trend-driven or marketing-driven preferences in automobiles. These factors will
work against adoption of biofuels vehicles unless the vehicles can be produced in
a way that coincides with current trends (as of this writing, trends are toward
larger, heavier sport utility vehicles, pickup trucks, and minivans).
• Cultural perceptions surrounding automobiles (such as the association of powerful
engines with "macho" characteristics) could negatively influence adoption of
biofuels vehicles. Cultural perceptions might have a positive impact on adoption
of biofuels vehicles among a population subset, perhaps of individualists or
environmentalists who might see the vehicles as a personal statement in favor of
environmental protection.
In the case of compact fluorescent lights, cultural norms might dictate that are
strongly associated with kitchen and industrial lighting. Such a norm might reduce consumer
adoption of compact fluorescent bulbs for general home use, while supporting adoption in
workspaces.
Once adopted, a new technology may affect cultural norms. For instance,
implementation of mass transit can have (and is often designed to have) influence on patterns
of where people live, work, and shop. Mass transit may influence cultural norms in more
subtle ways, by promoting interactions between travelers that would not occur if each traveler
were in his or her own vehicle.
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6.3.5 Are there environmental justice and equity issues to be considered and what do
they imply for the siting of a macro technology?
Environmental justice can be defined as "the pursuit of equal justice and equal
protection under the law for all environmental statutes and regulations without discrimination
based on race, ethnicity, and /or socioeconomic status." Environmental justice defenders
believe that this concept should apply to governmental actions at all levels—local, state, and
federal—as well as private industry activities. It is also believed that providing
environmental justice goes beyond the stated definition and should include a guarantee of
equal access to relief and meaningful community participation with government and industry
decisionmakers.
The University of Michigan (2000) website on environmental justice organizes
environmental equity issues into three categories:
• Procedural inequity. This issue addresses questions of fair treatment: the extent
that governing rules, regulations, and evaluation criteria are applied uniformly.
Examples of procedural inequity are stacking boards and commissions with pro-
business interests, holding hearings in remote locations to minimize public
participation, and using English-only material to communicate to non-English
speaking communities. For instance, where a state is considering banning
fluorescent lights from disposal at municipal waste incinerators, if it holds
hearings only in the state capitol, procedural inequity might accrue to the
communities living near incinerators who lack resources to travel to the hearings.
• Geographical inequity. Some neighborhoods, communities, and regions receive
direct benefits, such as jobs and tax revenues, from industrial production, while
the costs, such as the burdens of waste disposal, are sent elsewhere. Communities
hosting waste-disposal facilities receive fewer economic benefits than
communities generating the waste. Within a community hosting the industrial
production, benefits are often disproportionately distributed, with the most
pollution exposure falling to the neighbors living near the facility fenceline or to
lower-paid production workers at the facility, while tax revenues from the facility
are distributed across the tax authority jurisdiction.
• Social inequity. Environmental decisions often mirror the power arrangements of
larger society and reflect the still-existing racial bias in the United States.
Institutional racism has influenced the siting of noxious facilities and has let many
black communities become sacrifice zones (Bullard, 1993).
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Environmental justice issues that the biofuels technology assessor would consider include the
following:
• Reduction in petroleum refining could reduce exposure to air toxics in
communities living near refineries. These communities often suffer from
procedural, geographic, and social inequity (National Oil Refinery Network
Webpage, 2000).
• Reduction in oil drilling might reduce procedural and social inequities currently
suffered by many indigenous people whose lands and culture are being degraded
as result of oil exploration (Rainforest Action Network, 2000).
• If biofuels crops are produced using high-intensity agriculture that relies on
intensive pesticide, herbicide, and synthetic fertilizer use, then demand for
petroleum-derived products would be expected to increase somewhat, thereby
offsetting some of the expected petroleum demand reductions created by
introducing biofueled automobiles.
• Pesticide contamination of rural water supplies disproportionately affects farm
communities; increased high-intensity cultivation of biofuels crops may intensify
this geographical inequity.
6.3.6 Are there second-generation technology impacts?
Second generation impacts refer to the long-term and cumulative impact of
technologies that have the potential to not only change individual lifestyles for the adopters
but also the social-economic composition. Mechanization of farming, for instance, favors
large-scale production and can drive small farmers out of business over time. This can have
the long-term effect of eliminating farming as we know it in a society, which may or may not
be what the society wants. Hence, the implications of technological decisions today on
relative social status tomorrow need to be considered.
6.4 References
Bullard, Robert D. 1993. "Waste and Racism: A Stacked Deck?" Confronting
Environmental Racism: Voices from the Grassroots. Boston, MA: South End Press.
Bush, Corlann in Winston, Morton E., and Ralph D. Edelbach. 2000. Society, Ethics, and
Technology. Canada: Wadsworth.
Groenewegen, John, ed. 1996. Transaction Cost Economics and Beyond. Boston: Kluwer
Academic Publishers.
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Krugman, Paul. 1999. The Return of Depression Economics. New York: W.W. Norton
Company.
Mesthene, Emmanuel G. 1970. Technological Change: Its Impact on Man and Society.
Cambridge, MA: Harvard University Press.
McGrinn in Winston, Morton E., and Ralph D. Edelbach. 2000. Society, Ethics, and
Technology. Canada: Wadsworth.
National Oil Refinery Network. 2000. .
Ngos.net. 2000. .
Office of Technology Assessment. 1978. Government Involvement in the Innovation
Process. A Contractor's Report to the Office of Technology Assessment.
.
Office of Technology Assessment. 1981. An Assessment of Technology for Local
Development < http://www.wws.princeton.edu/~ota/>.
Rainforest Action Network. 2000. Indigenous Communities at the Edge.
.
University of Michigan. 2000. "What is Environmental Justice?"
.
University of Michigan. 2000. "What is Environmental Justice Home Page"
.
Winston, Morton E., and Ralph D. Edelbach. 2000. Society, Ethics, and Technology.
Canada: Wadsworth.
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Table 6-1. Identifying Political, Institutional, and Social Considerations
Political Considerations
What is the current political system stance toward
global climate change and mitigation technology?
Is the technology part of the country's national
security agenda?
Is development of the technology part of the country's
trade policy agenda?
What is the scale of the technology-macro, micro, or
efficiency improving? Macro — large, centralized;
micro — smaller, decentralized
Who are the stakeholders? Would there be differences
in perception between income levels, age, gender, race,
or other groupings of consumers or receivers?
Who will be the beneficiaries of the technology? Who
stands to be hurt by adoption of the technology?
(Identify sub-groupings of producers, consumers, the
environment)
What is the extent of benefit or hurt to the respective
political groups?
Is the country in which the technology would be
implemented industrialized or developing? (For
international assessments)
Is the political system democratic or authoritarian?
(For international assessments) Addresses the issue of
attractiveness for foreign investors to finance
technology adoption.
Sample
Questions/Considerations
Specific to Biofuels
Are biofuels perceived as
promoting domestic energy self-
sufficiency?.
What will impact of biofuels
acceptance be on US balance of
trade?
Will users realize overall cost
savings with biofuels compared
to conventional fuels?
Importance
(0 = None ...
5 = Very)
Need More
Information?
Notes
ON
K)
vo
(continued)
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Table 6-1. Identifying Political, Institutional, and Social Considerations (Continued)
Question
Sample Questions/Considerations
Specific to Biofuels
Importance
(0 = None...
5 = Very)
Need More
Information?
Notes
U)
o
Institutional Considerations
Are there barriers to technology adoption/diffusion due to
formal institutions? (Potential harm to institution's
interests, resistance to change, established standards,
market imperfection barriers.)
What direct or indirect institutional influences may speed
or slow adoption? Market characteristics; rules to deal
with other problems such as inflation, interest rates, or
unemployment: tax law. government incentives,
government purchases.
Who is(are) the likely implementing body(s)? Government
agency (singly or jointly), shared between government and
private sector, etc.
What is the decisionmaking structure? (A diagram is
recommended.)
Does the implementing body have political backing, does
it demonstrate leadership, and enforcement determination,
does it have accountability and managerial autonomy?
What current codes and standards would influence this.
technology, what are anticipated trends of legislation?
What institution(s) would likely finance the technology?
Who is willing to take the investment risk? Would
government be willing to share risk, or provide other
incentives?
Are there international treaties, conventions, or agreements
influencing technology adoption/dispersion? (An
institution's willingness to fund anything from research
through full-scale development could be affected.)
What NGOs could be involved and would they all be
supportive or have mixed responses to potential
implementation?
What barriers might oil companies
erect to biofuels implementation/
dissemination?
Are subsidies, are likely to be needed
to speed adoption? What is likely cost
to consumers of biofueled cars?
What is the position of major
environmental NGO's on biofuels?
Are they likely to be supportive?
(continued)
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Table 6-1. Identifying Political, Institutional, and Social Considerations (Continued)
Question
Sample Questions/Considerations
Specific to Biofuels
Importance
(0 = None...
5 = Very)
Need More
Information?
Notes
Social Considerations
What is the relationship between population
demographics and the technology?
What factors influence an individual's willingness to
adopt a new technology?(Financial, physical/safety,
psychological demand)
Will interaction between individual psychology and
group psychology help or hinder technology
implementation (use by the public)? (Affected by
individual's reference group opinion or attitude toward
the technology. Reference group starts with family and
friends and extends to public opinion)
Are there cultures or norms that could influence an
individual's willingness to adopt the technology?
Are there environmental justice or equity issues to be
considered? (For instance siting of new technology
production or use facilities to receive job and tax
revenue benefits, or location of unwanted emission
sources.)
Are there second generation technology impacts?
(Long-term cumulative impacts of technologies that
can change socioeconomic composition.)
Do biofuels benefit older or younger
populations more; or benefit those in
higher or lower socioeconomic status
more?
Will extra learning and efforts be
required to use biofuels engines? Will
attitude adjustment be required?
Will lifestyle habits influence
adoption of biofuels?
Will biofuels adoption reduce net oil
drilling? What impact on oil
exploration (indigenous peoples'
lands; communities near refineries)
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SECTION 7
PUTTING IT ALL TOGETHER
This section discusses the value and nature of assessment results, the collection and
organization of information gathered in the process, assessment methods, and interpretation
and use of the results with a focus on the issue of uncertainty.
7.1 Nature of Assessment Results
Technology assessment is an attempt to understand what factors influence whether a
technology gets adopted and predict and understand what the effects of a technology will be
if it is implemented. While an assessment may yield a report as a product, the fact that the
assessment generates predictions with varying levels of uncertainty suggests a need for the
assessment to be an on-going process. Assessments are a process or way of thinking about
technology that allows the assessor to make predictions of effects rather than conclusions
about effects. The predictions may be improved (uncertainty reduced) by more in-depth
inquiry, or by revelation of facts as technology development actually occurs.
The assessment methodology presented in this document covers a broad range of
technological, environmental, economic, and human effects that will, if evaluated, provide
insights to numerous issues in each area. The assessment is designed to be flexible enough to
cover a wide variety of technologies. Because the assessment is flexible, the initial
application can only address a limited number of issues. However, information produced by
the assessment provides data to address additional issues or issues in more depth.
For example, an initial application of the assessment methodology may call attention
to the environmental issue of water quality impacts from manufacturing process wastewater.
The assessment would identify that wastewater would have a local, immediate impact, unless
production on a national scale grew rapidly. The assessment would also identify other traits
related to the wastewater impacts. However, details about the particular constituents of the
wastewater would need to be evaluated in a follow-up assessment.
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Another example would be an initial assessment that identifies particular industries
that would suffer employment losses if new technology is adopted. With this information
more in-depth investigation of geographical consequences of those employment losses and
skill sets of displaced workers would be possible. This could assist in investigating ways to
offset the negative consequences of new technology adoption.
The "global" aspect of global change makes assessments of technologies that would
have an impact on global change different from other technology assessments due to their
global implications. The "global" aspect means that a grand scale of analysis is required in
each one of the categories (technological, economics, environmental, institutional, political,
and social). The methodology presented is focused on potential U.S. applications of the
technology and a U.S. contribution to world-wide mitigation efforts. Yet many of the
assessment elements related to the mitigation action have global implications. For example,
changes in the U.S. economy resulting from adoption of a mitigation technology may well
have implications for the world or global economy. While one must assess global climate
change on a grand scale, there must also be an understanding of the many small-scale issues
that make up the grand-scale picture, leading to inherent complexity and uncertainty in the
assessment.
The fact that global change is influenced by a wide array of public sector and private
sector entities, including government and business, and the interactions between those
institutions, is another reason an assessment of technologies related to climate change is
difficult. The business entities alone include such broad sectors as energy use, utilities,
transportation, lighting, and manufacturing, not to mention the subcategories within those
sectors. Government policies to stabilize GHG concentrations can affect the private sector,
and perhaps economic development, in countless ways. The same can be said for private-
sector actions to continue economic development or reduce GHGs.
The spectrum of technologies that impact global change can also vary in scale,
implementing body, cost, and several other technical factors. Four broad categories of
technologies are climatic engineering, adaptation, mitigation, and prevention (Tietenberg,
1992).
Time frame is another difficult issue to evaluate when dealing with climate change
issues. It is difficult to know how soon technologies need to be adopted to make an impact,
when those results may be realized, and how they will affect economic development,
ecosystem adaption to climate change, and food production (White House Initiative, 2000).
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Assessment results must always be clarified or qualified by geographic and other
assumptions defined early in the assessment process (i.e., Section 3). For instance, the
assessment results for technologies introduced in the United States could be completely
different than results for the same technologies' impacts on economic, political, and social
systems when introduced in Thailand. Although users can focus the assessment methodology
on the United States, the effects must be interpreted as effects on global climate change
stemming from the U.S. economic, political, and social systems, and it must be known that
the United States is one small segment of the global economic, political, and social system.
7.2 Gather Information from All Sections Together
Sections 3 through 6 of the strategic technology assessment report discuss how to
collect specific information about various impacts. This section of the report suggests a way
to combine the information from the separate sections to synthesize what was learned about a
particular technology. Combining the sections should show an overall picture of potential
barriers to technology introduction, as well as potential opportunities and benefits.
Figure 7-1 illustrates the recommended steps of combining the results from each section,
comparing the findings, and either reassessing or producing a set of assessment results.
7.2.1 Summarizing Findings
First, the user will summarize the significant results from each section (see Table 7-1
for a format for summarization). Although all impacts are important, this table is intended to
highlight the findings of potential major significance. Selection of major results implies
using judgment to pick findings that are likely to be most significant in facilitating or
hindering adoption. Table 7-1 shows example results that might be found during an analysis
of biofuels. These examples illustrate use of Table 7-1 but do not represent results of an
actual assessment.
The task of narrowing the focus for next steps is facilitated by using the second
column of the table. This column allows the user to indicate the likelihood of conclusion for
any particular result. Assigned numbers can be used to selectively focus on the more likely
outcomes or to mark those questionable results where an uncertainty analysis might be
needed. If an uncertainty analysis is required, it will most likely be done separately for the
particular result, and,then the user will reexamine findings based on the results. Section 7.3
provides a more detailed discussion of uncertainty.
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1
Summarize Findings
• Results (barriers and opportunities)
• Likelihood of Conclusion
• Need More Information or Red Flag
• Key Assumptions
• Notes
Uncertainty analysis
Further Research
Prioritize Research
Educate Public
I
Compare
Results
Consistency
Key Assumptions
Consistency
Critical to Success
Overall Adoption Rate
I
•/Uncertainty analysis)-
>I
Assessment
Results
Figure 7-1. Recommended Steps to Synthesize Information
Certain results may raise serious concerns that need to be "red-flagged" or issues that
need more information to determine what the result may be. Column 3 allows the user to
highlight these concerns. Noting where a result is a red flag or needs more information will
allow the user to decide where further research is needed, which issues should be researched
first, or where the public needs to be educated about red flag issues that are a part of a
technology package. Research and education needs may lead a user'to reexamine findings.
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Column 4 of Table 7-1 asks the user to list the assumptions used in each of the
sections. Those assumptions should be listed to correspond with the major results reported
from each section. Many assumptions will come from Section 3 where users are directed to
describe and frame the technological system they are assessing. Defining the technology in
Section 3 requires decisions about the boundaries, technical requirements and scale
limitations of the technology, as well as many other technology traits. For biofuels, the
boundaries could be defined as a biofuel/gasoline mixture that can be used in current
automobile engines. Crops and infrastructure to produce and use the mixture could be
included as part of the assessment.
Additional assumptions may have been necessary as the user completed the
environmental, economic, and political/institutional/social sections of this document. For
example, in completing the environmental section where a technology requires greater
electricity consumption, it may be necessary to assume what percentage comes from nuclear
versus fossil-fuel generated sources to complete the impact picture. This assumption should
be listed in column 4 of Table 7-1.
7.2.2 Compare Findings
Once the main results are identified, the user should identify how results relate to each
other. In some cases, a direct relationship may magnify a certain result, an indirect
relationship that could highlight interrelationships, or no relationship. For instance, habitat
change could be a potential result from the environmental section, while the economics
section could have raised the issue of whether the United States has adequate arable land and
conditions to produce appropriate level of biofuels. Habitat change and the amount of arable
land may be interrelated, depending on whether additional cropland will be needed, and
whether the cropland will encroach on forests or previously undeveloped natural areas. In
some cases, results may contradict each other, which would point out where further research
might be necessary.
In some cases, conclusions from one section may need to be reviewed in light of
results from other sections. In the biofuels illustration the user might list reduced GHG
emissions for vehicles in the environmental section, while large start-up costs are listed as a
major result of the economics section. Start-up activities to scale up grain production and
create an infrastructure to process grains into fuels could involve increased fertilizer and
pesticide production, more processing plants, and more transportation costs—which would
lead to more energy use. Ensuring that GHG reductions from the use of biofuels would
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Table 7-1. Sample Summary Showing Examples of Results that might be Expected
from a Biofuels Assessment
Results
Boundary of technology
— biofuel/gasoline mixture to
replace gasoline in 20% of
automobiles
Performance-U.S. has arable land
and conditions to produce
appropriate level of biofuels
Safety-Vehicles more safe in
crashes, spills less of a hazard
Reduced CO2 emissions from
vehicles
Habitat change
Inadequate infrastructure for
use/service
Large start-up costs
Benefit/harm to political groups
Government finance
Likelihood
of
Conclusion3
3
3
3
2
4
4
4
Need More
Information
(M)or
Red Flag (R)
M
R
Key Assumptions
on Which
Conclusion is Based
Boundary includes
the growing and
processing of crops to
generate biofuels
Customers are willing
to purchase biofuels,
Increased fertilizer &
pesticide production
doesn't emit more
GHG than vehicles
save
Increased farmland
needed
Distribution of
alternative fuels,
maintenance of
vehicles
Scale-up grain
production, vehicle
engine retrofits
Powerful oil
company lobby, anti
Kyoto congress
Government must
subsidize, regulate, or
provide other
incentives due to low
current demand
Notes
Virtually certain (5), confident (4), probable (3), questionable (2), very unlikely (1)
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override increased energy use for production and processing would be an important step at
this point.
Just as results need to be compared to determine interconnections or decrease
inconsistencies, assumptions also need to be compared. By listing key assumptions it will
become clear whether there are inconsistencies between assessment sections in this regard.
Inconsistency at this point means the assessor must select one or the other assumption and
return to the section of the methodology where revision is necessary to generate findings on a
consistent basis.
Once critical assumptions are identified and made consistent, evaluators can better
identify what major factors may influence the performance of the technology. The list of
assumptions can also be evaluated further. The user should attempt to identify and highlight
those that are likely to have the greatest affect on technology diffusion and impacts. In other
words the conclusions of the technology assessment will be the most sensitive to certain
assumptions that are critical to the technology's success.
Comparing assumptions should make it clear if the same overall adoption rate were
assumed for all of the results. The rate of technology adoption is important to determine if it
is a reasonable rate in light of the section conclusions. For instance, in the biofuels example
it was assumed that a biofuel/gasoline mixture would replace gasoline in 20 percent of
vehicles. If the land and infrastructure requirements appear too demanding to achieve a
20 percent adoption rate, one might want to adjust the adoption rate to 10 percent. If the rate
of technology adoption is changed because of a particular impact, it is important to see how
the new adoption rate will affect other impacts. In the biofuels case, if the adoption rate is
decreased to 10 percent, GHG emissions will not decrease as much as if a 20 percent
adoption rate was assumed.
Once findings are summarized and compared, assessors can determine whether the
findings need to be revised in light of inconsistencies or other issues. If assessors are
comfortable with the list of findings, critical assumptions and assumed adoption rate, the
assessment results can be considered complete for that particular application of the
assessment.
7.3 Dealing with Uncertainty
Although while this methodology is designed to facilitate a systematic approach to
technology assessment and decision-making, some degree of uncertainty regarding impacts is
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to be expected. Uncertainty regarding both the positive and negative impacts of a technology
affects how the technologies are evaluated and compared. There is a variety of methods for
addressing uncertainty in any analysis, but the most important component is an explicit
identification of the known sources of uncertainty. Effective decisions can be made in the
context of clearly identified and understood uncertainty; however, undefined uncertainty can
cause unanticipated and potentially adverse impacts. This section provides a brief discussion
of potential approaches for addressing uncertainty and highlights potential sources of
uncertainty in the strategic assessment methodology.
7.3.1 Causes of Uncertainty
In the context of decision making, uncertainty implies an unknown consequence or
outcome. Uncertainty is associated with the assessment inputs and information about the
technology being assessed, and uncertainty is also associated with external elements,
sometimes referred to as "the state of nature" in decision theory, such as future political and
international events. Uncertainty can occur due to a lack of information or conflicting
information.
Lack of information may result from a variety of circumstances, from the assessor
simply not having access to information (e.g., proprietary data) to the state of the science
falling short of complete information. Some information gaps can be filled through further
investigation or through research, and the uncertainty is thus mitigated. Other information
gaps cannot be filled because of either technical barriers or budget and schedule constraints.
In any case, lack of relevant information should be identified and addressed as a source of
uncertainty.
Conflicting information can result from the fact that the sources of information have
conflicting objectives or agendas. Competitors in a particular industry may present
conflicting data about the efficacy of each other's products; environmental groups are likely
to present data that contradicts data from an industry group. Moreover, the inherent
variability in a technology's performance or impacts will be reflected in information about
the technology. Conflicting information does not necessarily imply a correct versus an
incorrect answer; rather, these inconsistencies can indicate sources of uncertainty.
7.3.2 Dealing With Uncertainty in Decision Analysis
Each phase of the assessment methodology consists of information gathering and
analysis. It is anticipated that information availability could be limited for any or all phases.
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It is helpful to establish at the outset of an assessment whether data gaps are to be filled as the
assessment proceeds, and if so, what level of effort is expected. For example, if a technology
requires a change in manufacturing raw materials, but information is not provided on the
disposal of existing inventories of the old raw material, the assessor might attempt to fill this
information gap by making a few phone calls, performing a literature search, or developing
and implementing an industry-wide survey. These responses each require quite different
levels of effort. A decision must be made about the acceptable level of uncertainty.
Once the assessment information base is considered complete, there are generally
accepted methods for addressing the uncertainty associated with lack of information or
conflicting information. These include
• considering a range of outcomes that reflects the potential magnitude of
unavailable data;
• selecting assessment scenarios that reflect low, medium, and high conditions; or
• using probabilistic methods to characterize the variability in the data.
Considering a range of outcomes informs the assessor of the bounds or limits on
potential impacts when complete information is lacking. For example, consider a
hypothetical technology that introduces a contaminant into the environment, but there are no
ecotoxicological data available for the chemical. The assessor could identify other chemicals
with similar chemical structure and properties and evaluate potential impacts assuming a
toxicity similar to the most and the least toxic chemicals. This approach can indicate the
upper and lower bounds of the potential ecotoxicological impacts.
Low, medium, and high scenarios can be used when a range of data are available, or
impacts can vary widely. For example, many technologies' impacts depend on the degree to
which they are adopted. Assuming a low, medium, and high rate of adoption and proceeding
through the assessment methodology for each scenario would allow the assessor to consider a
range of potential impacts.
Probabilistic methods, such as Monte Carlo analysis, address the variability inherent
in a data set. For example, a GHG emission control technology might have data indicating
that the emission control efficiency varies based on differences in process temperature. A
probabilistic analysis could generate distributions of control efficiencies based on the
variation in process temperature.
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7.3.3 Uncertainty in the Strategic Technology Assessment Methodology
The most important step in addressing uncertainty is identifying the potential sources
of uncertainty and describing them explicitly in the technology assessment. Some of the
likely sources of uncertainty inherent in the methodology are identified in this section.
7.3.3.1 Specifying the Technology for Consideration
A primary source for an assessment would be lack of information (or conflicting
information) describing the technology itself. Technologies that have undergone pilot-scale
testing are likely to have more detailed technical descriptions than technologies that are less
well developed. If a technology has been systematically developed, tested, and described,
the assessment can be more definitive. Table 3-1 shows a list of key considerations for
technology assessment. The absence of these types of data is a source of uncertainty.
7.3.3.2 Environmental Impacts
This phase of the assessment calls for considering the effects that occur in various
environmental media. This might require information on the behavior of various chemicals
in the environment as well as information on human and environmental health effects. These
types of data are available for certain well-studied compounds, but for many chemicals data
will be lacking. This phase also includes considering indirect and cumulative impacts. In
many cases, these impacts are not intuitively obvious and may require input from a variety of
experts (e.g., toxicologists, biologists).
7.3.3.3 Economic System
The EIA consists of predicting the response of firms and consumers to new
technologies and changes in prices and quantities of goods. While the basic theoretical
models of supply and demand are well established, accounting for the many influences on
decision-making by firms and consumers is always difficult in practice. For example,
Table 5-3 includes questions about whether the new technology will increase or decrease the
demand for other goods, and whether the new technology will require a lifestyle change.
This information informs the assessment of potential impacts; however, it addresses human
behavior and preferences and is therefore characterized by uncertainty. Furthermore, the
empirical models often require a great deal of specific data and expertise to run. As with the
environmental impacts, economic studies may exist for prominent technologies, but for many
technologies there will be little empirical evidence in the literature.
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7.3.3.4 Political, Institutional, and Social Considerations
This phase of the assessment methodology addresses the context into which a
technology will be introduced. While this phase does not describe concrete potential impacts
of a technology, it raises essential questions about the effects of political, institutional, and
social entities on the technology, its adoption, and use. The primary source of uncertainty
consists of making projections about the behavior of institutions, governments, and
individuals. Table 6-1 includes an importance rank for the various considerations outlined in
Section 6. The assessor could highlight the significant sources by identifying and describing
questions and unknown outcomes associated with any question given a high importance
value.
7.4 Use of Assessment Tools
Researchers have developed a variety of decision analysis and assessment tools to
help understand and quantify the impact of new technologies or new policies on the economy
and on the environment. They range from highly complex computer models to qualitative
assessments of the effects on different stakeholder groups to soliciting input from a panel of
experts. All methods have positive and negative features, and an informed decision should
make use of a variety of information sources and assessment methodologies. Large computer
models provide the ability to model interactions and feedbacks, but often at a highly
aggregated level. Furthermore, computerized or mathematical models have difficulty
capturing the impact of new technologies on society in a broader sense including the social
and institutional structure. However, smaller case studies are difficult to generalize, and
qualitative analysis does not always provide common metric by which to compare
alternatives. Some of the more common tools for assessing the impact of policies and
technologies on people and the environment are reviewed below. There is some overlap
across the categories; for example, computerized integrated assessment models can include
cost-benefit analysis.
7.4.1 Modeling
We start by defining two types of economic analysis, partial equilibrium analysis and
general equilibrium analysis, and two methods of constructing models, top-down and bottom-
up. Although the lines sometimes blur, it is useful to keep the distinction between them in
mind when assessing the reliability of results from an assessment.
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7.4.1.1 Partial Equilibrium Analysis
Partial equilibrium analysis examines the effects of a policy only on the markets that
are directly affected. This limited type of analysis allows the modeler to focus on a particular
sector in detail, for example, looking at facility-level impacts of a change in policy or
technology within a given industry. The analysis ignores indirect effects on other sectors of
the economy or assumes that the changes in question are too small to have any significant
impact outside the directly affected industry or industries. It also neglects some household
responses to changes in policy or technology.
7.4.1.2 General Equilibrium Analysis
General equilibrium analysis attempts to capture the effects of a change in one or
more sectors of the economy on other sectors of the economy including feedbacks and
interactions between sectors. Typically these models include links between inputs and
outputs through some type of technology. These models vary greatly in the amount of detail
modeled and the sophistication of the links between sectors; between inputs and outputs;
between producers and consumers; and between producers, consumers and the environment.
Because the models can become very complicated very quickly, analysis is usually performed
at an aggregated level.
7.4.1.3 Top-down Modeling
Top-down economic models for estimating costs start with a production function
where output is produced by various inputs, including for example energy. If energy inputs
become more expensive and energy use is reduced, then ultimately output will fall. The
economic cost of the reduction in the input energy is the loss of output. These models are
typically conducted at a more aggregate level than bottom-up models; however, they
sometimes include more detail for particular sectors, thus blurring the line between the two
approaches.
7.4.1.4 Bottom-up Modeling
Bottom-up modeling is an engineering-based approach to estimating costs that starts
with characterizing possible technologies. The cost of reducing emissions is the cost of
implementing the new technologies. These models include greater detail about individual
technology options, but some fail to capture the feedbacks between different sectors of the
economy and households.
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7.4.2 Methods of Assessment
7.4.2.1 Computerized Integrated Assessment Models (1AM)
These models typically combine models from two or more disciplines to evaluate
policy questions or formulate the optimal policy response to a particular target. For example,
a model of the economy might be combined with a general circulation model to predict the
consequences of increasing anthropogenic emissions and of controlling these emissions.
These models fall into the category of general equilibrium analysis.
A number of models exist to estimate the costs and benefits of GHG emission
strategies. Several publications include lists of major IAM and comparisons of their
strengths and weaknesses (see, for example, Weyant [2000], Cline [1992], Nordhaus [1998]).
Weyant (2000) lists five major factors that influence the interpretation of the leading climate
change economic prediction models. They include
• projections for base case GHG emissions and climate damages (including
economic activity, energy availability and prices and technology availability and
prices);
• climate policy regime (the degree of flexibility allowed in meeting targets);
• substitution possibilities for consumers and producers including turnover of
capital equipment;
• how the rate and process of technological change are modeled; and
• characterization of benefits of GHG emissions reductions (Weyant, 2000).
The primary drawback of computer-based IAM is the need to capture changes in
behavior in technology, in markets, and in the environment through mathematical equations.
This can only be done at a high level of aggregation, and the models often involve ad hoc
assumptions about the rate at which technology spreads or the response of consumers and
producers to changes in prices. Furthermore, the current generation of models does not fully
capture regional differences in the impact of climate change, especially in developing
countries.
In a book edited by Nordhaus (1998), three researchers, Kolstad, Weyant, and
Edmonds comment on the state of 1AM and the 1995 report by the IPCC on climate change.
In particular, they discuss the trade-off between creating simpler, more transparent models
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and more complicated, but difficult to understand models. Kolstad believes the simpler
models are preferable because people will not trust the results from models they can not
understand. However, Weyant and Edmonds argue that the simple models can only provide
insights into general questions, and that more complicated models are needed to address more
detailed policy scenarios. Edmonds in particular advocates the development of models that
contain detail for the sectors that are important to the policy question at hand.
7.4.2,2 Cost-Benefit Analysis
Cost-benefit analysis lays out the positive and negative impacts of a project or policy,
quantifies them, and, where possible, evaluates the impacts in dollar terms. Then the stream
of costs and benefits are usually discounted back to base year dollars to calculate the net
present value (NPV) of a project. "The explicit effort in [cost-benefit analysis] to place
dollar values on all benefits and costs is both a strength and a weakness, and is also that
which...differentiates [cost-benefit analysis] from other analytical techniques (Portney, 1998,
p. 113)." Cost-benefit analysis is widely used to assess or rank projects and policies and
more generally to make an accounting of the impacts of a project. Cost-benefit analysis will
not indicate the optimal project or policy, just whether the project produces a positive or
negative NPV.
7.4.2.3 Cost-Effectiveness Analysis
Cost-effectiveness analysis is very similar to cost-benefit analysis, except that the
costs of reaching a particular target or goal are assessed. The benefits side of the equation is
summed up by the target.
7.4.2.4 Multiattribute Analysis
Again, this technique seeks to assess the costs and benefits of a project, but without
assigning a dollar value to each component. Components that are hard to value in dollars
might be expressed in rates at which people are willing to trade-off different dimensions of
the outcome.
7.4.2.5 National Environmental Policy Act (NEPA) analysis
NEPA analysis represents a very similar approach to collecting information to the
approach outlined in this document. Under NEPA, many projects and policies require an
environmental impact statement (EIS). The EIS attempts to catalogue the anticipated impact
of a project on the environment, the local economy, and other historical and cultural
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resources. The impacts are typically evaluated for a range of alternatives to the preferred
project, including the "do nothing" alternative. The objective of the EIS report is to identify
the potentially harmful effects of a project before the project or policy is implemented to
allow for opportunities to mitigate damages or potentially to stop high damage projects. The
impacts of the project may be expressed in dollar terms where appropriate or simply
described and cataloged. Under NEPA, the EIS process includes a prominent role for public
participation with opportunities to comment on the EIS.
7.4.2.6 Other Types of Assessment
A number of alternatives exist for categorizing the impacts of projects and policies.
The population can be segmented into subgroups that stand to gain or lose from a project or
policy, and costs and benefits, not necessarily monetized, can be enumerated for the groups.
This provides a more detailed picture of the distributional aspects of a policy.
7.5 Organizing the Information for Output
Any assessment, especially about a topic likely to involve substantial uncertainty, will
ideally represent a flexible structure that can be applied to a variety of purposes. Of course,
the results of the entire assessment could be assembled into a report. The audience for the
report will determine the level of detail, formality, and emphasis. For example, reports could
be prepared to educate the public about a technology, or educate other people engaged in
technology assessment about the outcome of a particular assessment. Likewise, the report
could emphasize potential "red flags" or key assumptions. The assessment could also be
used to create issue-directed reports on particular topics. The environmental impacts of the
new technology could merit a separate report.
The assessment could be used to set or prioritize research agendas. Again, this could
apply to research on a variety of themes. With any new technology, there will be areas of
uncertainty about the performance of the technology, the rate of adoption, and the cost. The
assessment should help identify areas of greatest uncertainty that warrant closer examination.
If multiple technologies are assessed, then the results could help identify the most promising
technologies for future research. Furthermore, gaps in a particular section of the assessment
may consistently occur; for example perhaps very little is known about the impact of any of
the technologies on water quality, again suggesting an area for research.
Information from a thorough assessment of a particular technology can be used as an
input into a variety of different models or methods of decision analysis. For example, a
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variety of computer models of integrating climate change and the economy exist. These
models differ from each other in the assumptions they make about technology and the level
of detail at which they model sectors and technologies. The assessment can provide
information about which model is most appropriate for the type of technology or policy under
consideration. In these models, technology can be modeled as "putty-putty" or "putty-clay"
with variants in between. "Putty-putty" technologies assume capital is easy to adapt both
before and after investment, so older capital adjusts to changes in prices and technology as
easily as new capital. "Putty-clay" models assume that capital cannot be modified after
installation (Weyant, 2000). Depending on the characteristics of the technology and the
industry or industries in which it will be used different, assumptions will be more accurate,
and the assessment could help choose between these types of models. Alternatively, the
results of the assessments could be used to improve the details in the models by providing
information about expected benefits and the characteristics of the technologies.
Thinking more broadly, the results of the assessment could also be used as a
discussion tool. The assessment could form the basis of a questionnaire used to collect
information for different sources (organizations with different views) or to obtain the
opinions of a panel of experts. It could even be used to gauge the level of support for a
technology or the level of knowledge about a technology by industry or the public by creating
an opinion poll about the most important aspects of the technology identified through the
assessment.
7.6 References
Cline, William. 1992. The Economics of Global Wanning. Washington, DC: Institute for
International Economics.
Nordhaus, William (ed). 1998. Economics and Policy Issues in Climate Change.
Washington, DC: Resources for the Future.
Portney, Paul. 1998. "Applicability of Cost-Benefit Analysis to Climate Change." In
Economics and Policy Issues in Climate Change, William Nordhaus (ed.),.
Washington, DC.: Resources for the Future.
Tietenberg, Tom. 1992. Environmental and Natural Resource Economics, Third Edition.
New York: HarperCollins Publishers Inc.
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Weyent, John P. 2000. An Introduction to the Economics of Climate Change Policy.
Prepared for the Pew Center on Global Climate Change.
.
White House Initiative on Global Climate Change, . Accessed on November 3, 2000.
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