|
(in reverse chronological order)
ESD-WP-2011-14 Market-based valuation of transmission network expansion. A heuristic application in GB
José M. Chamorro
University of the Basque Country
Dpt. Financial Economics II
Av. Lehendakari Aguirre 83
48015 Bilbao, Spain
E-mail: jm.chamorro@ehu.es
Luis M. Abadie
Basque Centre for Climate Change (BC3)
Gran Via 35-2
48009 Bilbao, Spain
E-mail: lm.abadie@bc3research.org
Richard de Neufville
Engineering Systems Division
Massachusetts Institute of Technology
77 Massachusetts Avenue
Cambridge, MA 02139
E-mail: ardent@mit.edu
Marija Ilic
Dpt. Electrical and Computer Engineering
Carnegie Mellon University
5000 Forbes Avenue
Pittsburgh, PA 15213
E-mail: milic@ece.cmu.edu
Transmission investments are currently needed to meet an increasing electricity demand, to address security of supply concerns, and to reach carbon emissions targets. A key issue when assessing the benefits from an expanded grid concerns the valuation of the uncertain cash flows that result from the expansion. We develop a valuation model which combines optimization techniques, Monte Carlo simulation over the expansion project lifetime, and market data from futures contracts on commodities. The model allows for random failures in generation and transmission infrastructure. Uncertainty stems also from nodal loads, fuel prices, allowance prices, wind generation, and hydro generation. Thus the model accounts for the stochastic dynamics on both the demand side and the supply side. To demonstrate the model by example, we consider a simplified network with two nodes. It is intended to broadly resemble the power generation sectors in England/Wales and Scotland. We then focus on the proposed Western HVDC subsea link. We simulate the whole distribution of effects on system costs, carbon emissions, and unserved load.
> top
ESD-WP-2011-13 The Use of Safety Cases in Certification and Regulation
Prof. Nancy Leveson
Aeronautics and Astronautics/Engineering Systems
Massachusetts Institute of Technology
Certification of safety-critical systems is usually based on evaluation of whether a system or product reduces risk of specific losses to an acceptable level. There are major differences, however, in how that decision is made and on what evidence is required. The term Safety Case has become popular recently as a solution to the problem of regulating safety-critical systems. The term arises from the HSE (Health and Safety Executive) in the U.K., but different definitions seem to be rife. To avoid confusion, this paper uses the term “assurance cases” for the general term and limits the use of the term “safety case” to a very specific definition as an argument for why the system is safe. This paper examines the use of safety cases and regulation in general. The first important distinction is between types of regulation.
> top
ESD-WP-2011-12 An approximate dynamic programming framework for modeling global climate policy under decision-dependent uncertainty
Mort Webster
Engineering Systems Division
Massachusetts Institute of Technology
77 Massachusetts Avenue Cambridge, MA 02139
E-mail: mort@mit.edu
Nidhi Santen
Engineering Systems Division
Massachusetts Institute of Technology
77 Massachusetts Avenue Cambridge, MA 02139
E-mail: nrsanten@mit.edu
Panos Parpas
Department of Computing
Imperial College London
180 Queen's Gate
London, SW7 2AZ
United Kingdom
E-mail: p.parpas@imperial.ac.uk
Analyses of global climate policy as a sequential decision under uncertainty have been severely restricted by dimensionality and computational burdens. Therefore, they have limited the number of decision stages, discrete actions, or number and type of uncertainties considered. In particular, other formulations have difficulty modeling endogenous or decision-dependent uncertainties, in which the shock at time t+1 depends on the decision made at time t. In this paper, we present a stochastic dynamic programming formulation of the Dynamic Integrated Model of Climate and the Economy (DICE), and the application of approximate dynamic programming techniques to numerically solve for the optimal policy under uncertain and decision-dependent technological change. We compare numerical results using two alternative value function approximation approaches, one parametric and one non-parametric. Using the framework of dynamic programming, we show that an additional benefit to near-term emissions reductions comes from a probabilistic lowering of the costs of emissions reductions in future stages, which increases the optimal level of near-term actions.
> top
ESD-WP-2011-11 An approximate dynamic programming approach for designing train timetables
Maite Peña-Alcaraz
MIT Engineering Systems Division
Room E40-235
77 Massachusetts Ave
Cambridge MA 02139
Mort D. Webster
MIT Engineering Systems Division
Room E40-235
77 Massachusetts Ave
Cambridge MA 02139
Email: mort@mit.edu
Andrés Ramos
Profesor Propio Ordinario
Departamento de Organización Industrial
Instituto de Investigación Tecnológica
Escuela Técnica Superior de Ingeniería (ICAI)
Universidad Pontificia Comillas
Alberto Aguilera 23
28015 Madrid, Spain
Traditional approaches to solving the train timetabling problem—the optimal allocation of when each train arrives and departs each station—have relied on Mixed-Integer Programming (MIP) approaches. We propose an alternative formulation for this problem based on the modeling and algorithmic framework of approximate dynamic programming. We present a Q-learning algorithm in order to tractably solve the high-dimensional problem. We compare the performance of several variants of this approach, including discretizing the state and the action spaces, and continuous function approximation with global basis functions. We demonstrate the algorithms on two railway system cases, one minimizing energy consumption subject to punctuality constraints, and one maximizing capacity subject to safety constraints. We demonstrate that the ADP algorithm converges rapidly to an optimal solution, and that the number of iterations required increases linearly in the size of the rail system, in contrast with MIP approaches whose computation time grows exponentially. We also show that an additional benefit to the ADP approach is the intuition gained from visualizing the Q-factor functions, which graphically capture the intuitive tradeoffs between efficiency and constraints in both examples.
> top
ESD-WP-2011-10 Growth Patterns of Subway/Metro Systems Tracked by Degree Correlation
Daniel E. Whitney
MIT Engineering Systems Division
Room E40-243
77 Massachusetts Ave
Cambridge MA 02139
Email: dwhitney@mit.edu
Urban transportation systems grow over time as city populations grow and move and their transportation needs evolve. Typical network growth models, such as preferential attachment, grow the network node by node whereas rail systems grow by adding entire lines with all their nodes. The objective of this paper is to see if any canonical regular network forms capture the growth patterns of urban metro systems for which we have historical data in terms of old maps. Data from these maps reveal that the systems’ Pearson degree correlation grows increasingly toward positive values over time and in some cases becomes decidedly positive. We have derived closed form expressions for degree correlation and clustering coefficient for a variety of canonical forms that might be similar to metro systems. Of all those examined, only a few types patterned after a wide area network (WAN) with a “core-periphery” structure show similar behavior of the degree correlation as network size increases. This suggests that large metro systems either are designed or evolve into the equivalent of message carriers that seek to balance travel between arbitrary node-destination pairs with avoidance of congestion in the central regions of the network.
> top
ESD-WP-2011-09 Financing Methods for High-Speed Rail with Application to Portugal
Teng Huang
Master of Science in Transportation at MIT
1912 S. University Blvd
Denver, Co, 80210
Phone: 617-513-9365
Email: huangt@mit.edu
Joseph M. Sussman
JR East Professor of Civil and Environmental Engineering and Engineering Systems at MIT
77 Massachusetts Avenue
Cambridge, MA, 02139
Telephone: 617-253-4430
Fax: 617-258-5942
Email: sussman@mit.edu
High-Speed Rail (HSR) is of substantial and growing interest around the world. The European Union (EU) sees it as an integrating force; China is investing at an extraordinary level and even the U.S. is trying to move forward. Although HSR is expected to shrink the temporal distance between cities, reshape the travel patterns of people toward—we hope—environmentally-friendly ones, create an image effect for the country building it, promote regional economics, etc., HSR is an expensive alternative. It is more capital intensive than other transportation projects in both unit cost (the cost per lane or track km) and total cost. On the other hand, HSR can aid in the formations of megaregions with the potential for economic growth.
This paper discusses the cost characteristics of HSR, analyzes HSR’s potential economic influence on megaregions, and identifies megaregion-related revenues that can make HSR more financially viable: specifically, we discuss the use of value capture mechanisms to capture the megaregion economic benefits of HSR in order to finance such systems.
> top
ESD-WP-2011-08 ESD Summer Reading Lists 2003–2011
Joseph M. Sussman
JR East Professor
Professor of Civil & Environmental Engineering and Engineering Systems
Massachusetts Institute of Technology
Cambridge, Massachusetts
Back in 2003, when ESD was a toddler of about 41⁄2, we were preparing for our spring semester offsite traditionally held at the end of the academic year in late May or early June. I had the idea of preparing a short list of books with relevance to the ESD mission—the study of complex sociotechnical systems—and presented that idea to the then (and founding) ESD director Prof. Daniel Roos. He agreed it would be worthwhile as an experiment, and so I did create the first ESD Summer Faculty Reading List. A “summer” reading list carries the suggestion of books you can take to “the beach”. So no “text books” were included. The books were treatments of critical contemporary issues that the world faces, important methods and perspectives germane to these issues and the complex sociotechnical systems in general, and relevant history. In retrospect, the beach would likely be too distracting a venue for many of these books!
I got some “attaboys” on the 2003 list. A number of my colleagues said it was nice to take a look at my ideas about what books might be interesting reading. So with that positive feedback, I began to do this ESD Faculty Summer Reading List each year. When I did it the second year, I noted that this had now become a “tradition” and with an organization as young as ESD, we needed all the traditions we could get.
You can see where it has gone from here. The tradition has continued to the present day, with now nine years of history for this reading list. In the early days, the commentary on the books was largely my own. As years wore on we would include materials that others—the publisher or book reviewers—had prepared with some supplementary comments from me. And in later years my comments became less and less prevalent and even non-existent.
Another thing we did regularly was to include books that had been published during that current academic year by ESD faculty, so this served as a mechanism for highlighting the scholarly work of my ESD colleagues.
In any case, we have these reading lists encompassing 47 books over this nine year period and thought it would be helpful to publish it as an ESD working paper to give our colleagues at MIT and outside the Institute access in one document to this eclectic potpourri of books. You may even find something you want to read that you missed the first time around.
We hope the reader finds this compendium to be useful and we look forward to any feedback that you may have including suggestions for 2012 and forward.
Joseph M. Sussman
JR East Professor
Professor of Civil & Environmental Engineering and Engineering Systems
MIT
> top
ESD-WP-2011-07 Concepts in Uncertainty—Four brief teaching notes
Joseph M. Sussman
JR East Professor
Professor of Civil & Environmental Engineering and Engineering Systems
Massachusetts Institute of Technology
Cambridge, Massachusetts
In Spring 2010 I taught—for the first time—an undergraduate required subject in project evaluation (1.011). In the course of that teaching, I wrote and distributed several teaching notes, which were intended to illustrate for the student various systems concepts. The ones included here focused on the theme of uncertainty and how one deals with it.
The first two teaching notes deal with uncertainly in weather prediction and other natural phenomena. The first built on a “snowstorm that never happened” in Boston, as dire forecasts for snow were not indeed realized in February 2010. The paper tries to explain why this kind of thing can happen, given the relationship between storm tracks and amounts of fallen snow at a particular site. The second deals with tsunamis and the state-of-the-art in prediction of tsunamis, which occur as a result of earthquakes. This was motivated by an earthquake that took place in Chile, which many were concerned would lead to tsunamis across the Pacific, with dire effects on islands such as Guam and potentially even Japan. Here big tsunamis were predicted but didn’t occur. Again, we used that example to highlight uncertainties and why errors of this sort were made.
The third and fourth teaching notes deal with professional American football and decision-making under uncertainty. I tried to write these so that one didn’t have to be expert in the rules of football to follow the argument. In November 2009, New England Patriots coach Bill Belichick, made a quite controversial decision trying to convert a first down on a fourth down play in the last two minutes of a game with the Indianapolis Colts. The Patriots were leading at the time and a successful first down would have allowed the Patriots to retain possession of the ball, guaranteeing a win. His gamble failed; the Patriots did not make the first down and so surrendered the ball, and ultimately lost the game. So the third teaching note tried to explain why Belichick—widely hailed as one of the best coaches in NFL football history—could have made such a “blunder.” The fourth teaching note was a follow up and was concerned with the concept of rationality. Economists use the “rational actor” model to “predict” what people will do when faced with various choices. Often the economists are wrong in their predictions because their definition of rationality may well differ from that of the people actually making the decisions. We illustrate that by considering metrics other than simply maximizing the probability of winning the football game, as in teaching note 3. We included an “embarrassment factor,” which reflects some football coaches concern with appearing foolish when they make a gamble that fails. So they may make an “irrational” decision in the eyes of some, because they are not maximizing their team’s chance to win, but also include in their calculation how embarrassed they might be by their decision, which the coach sees as entirely rational.
These teaching notes would be of interest to the reader who is concerned with teaching uncertainty concepts to undergraduates, and may be of value to those who teach introductory graduate classes as well. Any comments on the substance, content, clarity, and value of the approach would be greatly appreciated.
> top
ESD-WP-2011-06 2009 H1N1 After Action Reports: Lessons on Vaccine Distribution
Julia Hopkins
Undergraduate (senior), Massachusetts Institute of Technology
Department of Civil and Environmental Engineering
Cambridge, Massachusetts 02139 USA
The responses of individual states to the 2009 H1N1 Pandemic are documented in their After Action Reports (AARs), written in summer 2010. In an attempt to understand how these responses could improve for future pandemics, this paper reviews the AARs of fourteen states to determine how vaccine distribution methods and communication issues impacted the success of the states’ responses to the 2009 H1N1 Pandemic. The results of this review reveal several trends to inform preparation for future pandemics. For instance, the best distribution method for times of low supply of vaccine and high demand is one based on county populations within a state, while an online ordering system for vaccine performs well in times of high supply and lower demand. Finally, this paper finds that the best preparedness plans are the ones for which components have been tested in some capacity prior to use.
> top
ESD-WP-2011-05 Introducing Complex Sociotechnical Systems to First-and Second-Year Students
Afreen Siddiqi
Research Scientist, Engineering Systems Division,
Massachusetts Institute of Technology, Cambridge, USA,
siddiqi@mit.edu
Regina Clewlow
PhD Candidate, Engineering Systems Division,
Massachusetts Institute of Technology, Cambridge, USA,
rclewlow@mit.edu
Joseph M. Sussman
JR East Professor of Civil and Environmental Engineering and Engineering Systems,
Massachusetts Institute of Technology, Cambridge, USA,
sussman@mit.edu
Retention of undergraduate engineering students remains a key challenge faced across the globe; in particular, the first two years of the required curriculum is often cited as a significant hurdle. Many students are attracted to engineering in order to solve important real-world problems. However, in the first two years, the majority of students find themselves in classes focused on the fundamentals of math and science, with little or no apparent connection to the real-world issues they care deeply about. Furthermore, most students traditionally develop a deep understanding in a specific engineering discipline, with limited opportunity to consider or analyze complex, sociotechnical systems (e.g. energy systems, transportation networks, healthcare) – systems that are the focus of critical engineering challenges. Although the subject of large-scale, sociotechnical systems has been successfully integrated into the realm of graduate education, it has seen limited attention in undergraduate studies where it has the potential to inspire and help retain the next generation of engineers.
This paper describes the development and implementation of a novel course, intended for freshmen and sophomores, that has been designed to address some of the needs of a new generation of students who are passionate and more engaged than ever before in understanding and impacting contemporary problems. The new course centers around the theme of Critical Contemporary Issues (CCI) – important and difficult problems pertinent to our present times on topics of sustainability, mobility, energy and the environment, healthcare, communication, the internet etc. In this course, we weave introductory instruction in system dynamics, networks and uncertainty with teams working on different semester-long projects. Through this approach, we enable students to engage in and understand the issues at play in a problem of their interest, appreciate the scope of the sociotechnical complexities in CCIs, and gain an introduction to analytical tools that can help in addressing some of these issues. This paper discusses the overall philosophy and motivation for establishing the course, the design of the curriculum, and the approach, execution, and integration of team-based projects.
> top
ESD-WP-2011-04 Feature Performance Metrics for Software as a Service Offering: The Case of HubSpot
Avi Latner
MIT, System Design and Management
Cambridge, MA, USA
Ricardo Valerdi
MIT, Lean Advancement Initiative
Cambridge, MA, USA
This paper provides an industry case study for measuring the performance of software as a service (SaaS) product features in order to prioritize development efforts. The case is based on empirical data from HubSpot and it is generalized to provide a framework applicable to other companies with large scale software offerings and distributed development. Firstly, relative value is measured by the impact that each feature has on customer acquisition and retention. Secondly, feature value is compared to feature cost and specifically development investment to determine feature profitability. Thirdly, feature sensitivity is measured. Feature sensitivity is defined as the effect a fixed amount of development investment has on value in a given time. Fourthly, features are segmented according to their location relative to the value to cost trend line into: most valuable features, outperforming, underperforming and fledglings. Finally, results are analyzed to determine future action. Maintenance and bug fixes are prioritized according to feature value. Product enhancements are prioritized according to sensitivity with special attention to fledglings. Underperforming features are either put on “lifesupport”, terminated or overhauled.
> top
ESD-WP-2011-03 Framing the Climate Debate: Knowledge Affirmation vs. Risk Mitigation
Caleb Joseph Waugh
S.M. Candidate, Technology and Policy Program
Engineering Systems Division
Massachusetts Institute of Technology
77 Massachusetts Ave. Building E19-411
Cambridge, MA 02139, USA
Tel (+1) 970-261-5198
cjwaugh@mit.edu
Opinions regarding the anthropogenic climate change hypothesis (ACC), along with the possibility of subsequent catastrophic environmental impacts, often break down along ideological lines that have lead to a dichotomy between “believers” on the one hand, and “non-believers” on the other. Although some scientific uncertainty remains, the current body of scientific evidence supporting the hypothesis is significant and enough to warrant consideration of a strong policy response. However, for any progress to be made on the policy front, the existing ideological dichotomy between believers/non-believers must be overcome. This will require policy advocates, including scientists, to do a much better job framing the scientific argument for policy intervention more in terms of the inherent scientific uncertainty and risk mitigation instead of suggesting that scientific outcomes and subsequent catastrophic events are indisputable. Much can be learned regarding a proper framing of climate science through philosophical reflection of the metaphysical and epistemological nature of science, and by considering similar historical examples of scientific knowledge assessment. Although reframing the debate in terms of the inherent scientific uncertainty is not sufficient to overcome all obstacles, having policy makers and the general public at large properly recognizing the nature of the scientific argument, instead of adhering to a believer/non-believer false dichotomy, is a first and necessary step.
> top
ESD-WP-2011-02 The Portuguese High Speed Rail Network; Relating Financing to Strategic and Operating Issues
João de Abreu e Silva
Instituto Superior Técnico
Avenida Rovisco Pais, 1049-001 Lisboa, Portugal
Tel (+351) 21 841 83 94 Fax (+351) 21 840 98 84
joao.abreu@civil.ist.utl.pt
Duarte Silva
RAVE
Av.ª D. João II, Lote 1.07.2.1, Piso 1 – Ala A e B, Parque das Nações,
1990-096 – Lisboa, Portugal
Tel (+351) 21 106 40 00 Fax (+351) 21 106 40 99
dnlsilva@rave.pt
Joseph Sussman
Massachusetts Insitute of Technology
77 Massachusetts Ave. Building 1-163
Cambridge, MA 02139-4307, USA
Tel (+1) 617 253 4430
sussman@mit.edu
This paper describes the implementation of the Portuguese High Speed Rail (HSR) Network. The business model developed by RAVE for the PPP’s related with the HSR infrastructure is described and discussed. Following a recently awarded research project (EXPRESS) aimed at studying the strategic aspects related with the implementation of HSR is presented and its aspects more directly related with HSR operation which could be relevant in a PPP context are discussed.
> top
ESD-WP-2011-01 The Dynamics of Circular Migration in Southern Europe: An Example of Social Innovation
Rafael Marañón-Abreu
Massachusetts Institute of Technology
77 Massachusetts Avenue
Cambridge, MA 02139 USA
rmaranon@sloan.mit.edu
Estrella Gualda Caballero
Universidad de Huelva
Facultad de Trabajo Social
Avda. Tres de Marzo, s/n
21071 Huelva – SPAIN
estrella@uhu.es
Ricardo Valerdi
Massachusetts Institute of Technology
77 Massachusetts Avenue
Cambridge, MA 02139 USA
rvalerdi@mit.edu
During economic crises, governments establish policies that facilitate the creation of jobs, goods and services that make their economies more resilient. Often, this requires innovative social programs that match global migratory trends to local labor demand. The implementation of such programs requires a significant degree of innovation that requires models that can capture the complexity involved. To explore this phenomenon, we provide a multi-disciplinary view of innovative social programs that shed light on the dynamic characteristics of the political, social, technological and economic aspects of circular migration. Our focus is a case study of the European Union-funded circular migration program to support the strawberry harvest in the province of Huelva in Spain. Covering the time period of 1999-2011, this paper provides a system dynamics model to represent the key elements that led to the success of circular migration from the standpoint of economic and social change. The model helps explain the key factors that make the program robust under recent economic crisis conditions. Based on a qualitative analytical approach, the model demonstrates how adaptive policies can enable macroeconomic equilibrium in environments where circular migration can be implemented. We also show that circular migration is not an impediment to economic recovery, in fact, it helps stabilize the labor supply in times of high uncertainty.
> top |
