Infrastructure Decision-Making under Climate Change Uncertainty: Case Study of Centralized Heating at Wright-Patterson AFB, Ohio

Abstract

Increased prevalence, lower cost, and reduced environmental impacts have granted natural gas status as a bridge fuel over the past decade in place of coal-fired heat and power generation across the United States. As a result, some coal facilities are retrofitting their systems to combust natural gas for heating and power. However, data and economic criteria surrounding these decisions are not widely available. Wright-Patterson Air Force Base (WPAFB) invested approximately $25 million, from 2014 to 2016, to retrofit two coal-fired steam-heat-generating plants with natural gas equipment. Economic analyses used to inform these long-term infrastructure decisions rarely consider the uncertainty of climate change. As the uncertainty of climate change projects is large, there is a distinct need to incorporate these forecasting models in large-scale infrastructure investments to facilitate robust decision-making. In this case study, we evaluate the uncertainty surrounding infrastructure decision-making through a Monte Carlo simulation. The case study evaluates the sensitivity of cost savings and payback period for the fuel switch relative to climate predictions. In this analysis, we characterize uncertainty of the retrofit as a function of its payback period length. The payback period is expected to increase by nearly 6 years (∼20%) when factoring climate change and uncertainty into the economic analysis. This case study showcases the uncertainty surrounding large infrastructure decisions with climate change implications.