16 Energy Economics and Environmental Impact
Investments in energy-efficient measures and systems, particularly renewable energy systems, require a relatively large up-front investment in equipment that results in future savings or future income. In order to evaluate these investments, it is necessary to understand how the value of money changes over time. These evaluations are typically studied in a field that has been traditionally called Engineering Economics or, more recently, Energy Economics. Engineers need to be well versed in methods to compare alternatives, or the best ideas may never be realized.