Risk-Aware Decision Making for Responsible Decarbonization
CME Department Seminar
October 4, 2024
11:00 AM - 12:00 PM America/Chicago
Presenter: Selva Nadarajah, PhD, University of Illinois Chicago
Location: ERF 1047
Abstract: Decarbonization targets, including NetZero, are key drivers of the energy transition. Investment and changes to operations determine transition pathways in this context. Climate concerns require accelerating the transition, while negative social and economic consequences of a rapid transition suggest caution. We will use a risk perspective to outline this tension at the core of a responsible clean energy transition and briefly touch on broader implications, such as with the transportation nexus. We will discuss how tools with roots in financial engineering and behavioral psychology can inform the formulation of risk-aware and interpretable decision models as large-scale Markov decision processes. Corporate procurement of electricity using power purchase agreements and energy-intensive manufacturing will serve as practical settings. In each case, we will also cover state-of-the-art approximation techniques to solve the risk-aware decision models. This talk is based on the following collection of papers: energy real options review, dynamic clean power procurement, and energy-intensive manufacturing.
Speaker Bio: Selva Nadarajah is an associate professor of information and decision sciences at the University of Illinois Chicago College of Business, and decision intelligence lead at the Discovery Partners Institute. Nadarajah develops dynamic valuation and decision-making models that guide investment and operations, with a focus on the energy industry. He also develops self-adapting stochastic optimization and reinforcement learning methods that endogenize model reformulation, performance acceleration, and parameter selection, with the goal of making these tools accessible to non-technical experts. Nadarajah's research has been recognized with the 2024 INFORMS Harvey J. Greenberg Award for computing and operations research, the 2021 Commodity and Energy Markets Association (CEMA) Best Paper Award, the 2020 INFORMS ENRE Young Researcher Prize, the Best Overall Paper at the 2020 NeurIPS Workshop on Tackling Climate Change with Machine Learning, and the 2014 William L. Cooper Dissertation Award. He serves as associate editor for Production and Operations Management (FT50 journal) and the Decision Sciences journal, and is area editor of the energy, natural resources, and the environment area of the Information Systems and Operations Journal published on behalf of the Canadian OR society. He received his PhD in Operations Research from Carnegie Mellon University.
Date posted
Sep 18, 2024
Date updated
Sep 18, 2024