Caribbean Energy Infrastructure: Bettering Lives through Social Impact & Energy Security

The LUDVIK Capstone team was tasked with developing a quantitatively oriented methodology to estimate the value of social impacts as a result of new energy infrastructure in the Caribbean. The team produced this in the form of an Excel model. The model offered views of different energy generation assets and their accompanying emissions profiles to then tie these case-by-case characteristics together with peer-reviewed-academia in order to estimate their likely benefit or detriment to society in terms of social impacts gained or loss in parallel with a project’s financial returns.

This initial model amalgamates seven of these unique formulaic relationships across the chosen impact categories of (1) Energy Affordability, (2) Environment, (3) Health, (4) Employment/Inequality, (5) Agriculture, (6) Education, and (7) Tourism to ultimately define a time-horizon-aligned estimation for the value gained or lost in each category as it would pertain to various energy generation asset classes. Added care was taken to align these forecasts with their host country environment and to weight their value outcomes accordingly. The final result is an annualized benefit/loss calculation that may be placed over the denominators of GDP, project OPEX, project MW, and so forth in order to calculate a Social ROI that is separate from a project’s financial returns. The value of this work is that it provides an intuitive perspective and conversational benchmark for key stakeholders from government, the private sector, and institutions to assess the broader merits or faults of an energy project’s investment decision.