I have a question about utilities; specifically: How to compare them among competing options for funding.
There is a wonderful new technology that is able to vaporize garbage (also known as "Municipal Solid Waste", or MSW). The output of this process consists of only three things: Synthetic gas, a metal alloy, and a glass-like slag. All three have commercial value. No pollution is created in the course of this transformation.
As you may know, markets for energy and metals are in the doldrums. The falling prices indicate a reduced utility for these commodities, and that creates a headwind for the sale of this new technology.
On the other hand, citizens hate landfills more than ever. No one wants to live near a garbage dump, so doing away with landfills has high utility.
My question, therefore, is this: How do I compare the falling utility of process outputs (the syngas, metal, and slag) with the increasing utility of eliminating landfills altogether? The physical outputs can be priced in the open market, but civic satisfaction is hard to measure.
Many thanks for any guidance you might have.
When trying to quantify "civic satisfaction," we need to determine what a community is willing to pay, in dollar terms, to remove the landfill. Typically this is done with randomized surveys, but unfortunately it appears that economists have not researched this question before. Pricing the outputs from the MSW facility is more straightforward. We can just use market prices and futures prices to get an estimate of the revenues obtained from the facility's production of gas, metals, and slag. This can tell us what the expected prices of the materials are years into the future. Given that gas and metals are non-renewable resources, economics tells us their prices will most likely increase over time unless new sources are discovered and able to be extracted.