A Descriptive Model of Choice for Siting Facilities: The Case of the California LNG Terminal

This paper develops a descriptive framework to provide a basis for prescriptive considerations for improving societal decision processes, such as that concerned with the siting of energy facilities that offer long-run benefits but at the risk of catastrophic consequences. The descriptive model incorporates multiple parties and multiple concerns in a dynamic setting. It emphasizes the potential for conflict emerging among the interested parties as a result of their differing objectives, mandates, and information sources. Of particular importance is the decentralized and sequential nature of the process. On the prescriptive side, the paper explores the role that analysis, including risk analysis assumption analysis, and multi-attribute utility analysis, can play in improving the decision process. The descriptive model and prescriptive considerations are illustrated by a concrete example-the siting of a liquefied natural gas terminal in California.

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