Energy Cafe: Cost-Benefit Analysis, Short-Termism & Social Discount Rate
The Social Discount Rate (SDR) determines the present value of future societal costs and benefits. A declining SDR suggests society values future benefits more over time. In Stefanski and Trew (2023) we challenge the idea that SDR is constant. We show that historical declines in interest rates reflect growing societal patience. Not accounting for this declining SDR can undervalue long-term benefits in cost-benefit analyses. For projects yielding benefits beyond a generation, a decreasing SDR is essential to accurately gauge future value.
The Energy Café is an informal, open and inclusive space where people across University of St Andrews, from undergraduates to Professors Emeriti, can come together for an hour to share ideas about the energy research they are working on. It is intended to encourage collaborations, expand research horizons, and inspire new ideas and questions about issues of energy.
The Energy Café series is now hybrid, hosted in person at the University of St Andrews and streamed online.