ARTICLE IN PRESS

Energy Policy 36 (2008) 991998

www.elsevier.com/locate/enpol

Functionality of the approach of hierarchical analysis in the full cost

accounting in the IRP of a metropolitan airport
Decio Cicone Jr.a,, Miguel Edgar Morales Udaetab, Jose Aquiles Baesso Grimonib,
Luiz Claudio Ribeiro Galvaob
a
GEPEA-USP, Grupo de Energia do Departamento de Engenharia de Energia e Automac- ao Eletricas,
Escola Politecnica da Universidade de Sao Paulo, Brazil
b
IEE/USP, Instituto de Eletrotecnica e Energia, Universidade de Sao Paulo, Brazil
Received 17 June 2007; accepted 19 November 2007
Available online 26 December 2007

Abstract

This work shows the application of the analytic hierarchy process (AHP) in the full cost accounting (FCA) within the integrated
resource planning (IRP) process. For this purpose, a pioneer case was developed and different energy solutions of supply and demand for
a metropolitan airport (Congonhas) were considered [Moreira, E.M., 2005. Modelamento energetico para o desenvolvimento limpo de
aeroporto metropolitano baseado na losoa do PIRO caso da metropole de Sao Paulo. Dissertac- ao de mestrado, GEPEA/USP].
These solutions were compared and analyzed utilizing the software solution Decision Lens that implements the AHP. The nal part of
this work has a classication of resources that can be considered to be the initial target as energy resources, thus facilitating the restraints
of the IRP of the airport and setting parameters aiming at sustainable development.
r 2007 Elsevier Ltd. All rights reserved.

Keywords: Integrated resource planning; Analytic hierarchy process; Full costs accounting

1. Introduction implemented, through the software solution Decision

The choice of the best portfolio of energy options for a
specic sector or region can be a very complex problem
when a diversity of options are considered both by the
supply and demand sides, and mainly if not only the
technical aspects of the options are considered, but also
the social, political and environmental aspects.
Moreira (2005) presented a diversity of analyses of
energy options for the Congonhas Airport, analyzing both
the supply and demand sides and utilizing the Full Cost
method of Accounting (FCA) that takes into consideration
technical, social, political and environmental aspects of a
determined solution. Due to the large number of informa-
tion considered on case of the airport and the subjectivity
of some of this information, there arises the need to make
use of a decision-supporting method. The AHP was
Corresponding author. Tel.: +55 11 96475156.
E-mail addresses: decio.cicone@poli.usp.br (D. Cicone Jr.),
udaeta@pea.usp.br (M.E.M. Udaeta).
Lens, that helps determine the priorities and identify the
best option within various possible alternatives, taking into
account both quantitative and qualitative aspects, through
the reduction of complex decisions to decisions that can be
compared through pair-wise comparison.
2. Initial concepts
2.1. Integrated resource planning (IRP)
IRP is a planning process whose aim is to establish better
distribution of resources, what implies the need for rational
use of the energy services, energy conservation as a form of
energy resource, use of the approach of end-use to
determine the potential of conservation and the costs-
benets involved in the implementation, promotion of
planning with better energy efciency and environmental
adequation and performance of an analysis of the
uncertainties associated with the different external factors
and the resource options (Udaeta, 1997).

0301-4215/$ - see front matter r 2007 Elsevier Ltd. All rights reserved.
doi:10.1016/j.enpol.2007.11.014
 ARTICLE IN PRESS
992 D. Cicone Jr. et al. / Energy Policy 36 (2008) 991998
IDENTIFY DEMAND
GOALS FORECAST
NEED FOR NEW
RESOURCES
SUPPLY DEMAND
DEFINITION
EXTERNAL FACTORS OF THE
ADEQUATE
SOCIAL AND COMBINATION
OF
ENVIRONMENTAL
RESOURCES
PUBLICS APPROVEMENT
PUBLICS PARTICIPATION
OBTENTION
MONITORING OF
RESOURCES
Fig. 1. Illustrative diagram of the IRP process.
IRP differentiates itself from the traditional planning in
the class and in the abrangence of the resources considered,
in the insertion of holders and resource users in the
planning process, in the organs involved in the resource
planning and in the criteria of resource selection. IRP is the
process through which a group of alternatives, both from
the supply and demand sides are planned, implemented,
and evaluated for the provision of the energy services at
costs that are at equilibrium with the groups interest, being
that such planning process of the decision maker or of the
entity that composes IRP affects these groups. In this
sense, Fig. 1 permits a schematic vision of the IRP in the
scope of the electric sector, through a diagram that involves
all the phases, thereby permitting the understanding of the
process as one that occurs both in the geographical and
timespace. 2.2.3. Basic steps in the evaluation process
2.2. Full cost accounting (FCA)
FCA can be dened as a method by which environ-
mental, social and political considerations can be coupled
to the traditional technicaleconomical models, and
integrated in the decisions to be made. Information on
external impacts and activities on the environment and
human health are evaluated qualitatively, if they cannot be
monetarized. The aim of this evaluation is to dene and
allocate the internal costs, dene and evaluate the
externalities associated with our activities.
In the traditional evaluations, it is common to perform
an economic evaluation considering only the internal costs
EXISTING
RESOURCES
T&D TARIFFS
ANALYSIS OF RISKS
AND UNCERTAINTIES
and leaving the other costs (environmental, social and
political) for later consideration. The FCA reduces the
probability of error in the choice and classication of the
energy resources as it considers the externalities, which can
represent a decisive factor in the evaluation. Frequently,
however, it is very difcult to quantify the external costs,
thus opting to consider them in a qualitative form, instead
of overlooking them.
In this work, various factors were considered, both the
internal and external factors, grouped into technicaleco-
nomical, political, social and environmental. The same
value was attributed to each group, therefore permitting
that the nal analysis points out the most attractive
solution for each case in question.
There are three basic steps in the FCA process, thereby
considering it as a complement and not a substitute of
existing evaluations (Boarati, 2003). The steps include:
(1) Definition of the options available: determination of
what shall be included in the analysis, what options
cover the proposed objectives and lastly, identication
of the necessary internal procedures.
(2) Identification and comprehension of the costs: identica-
tion of external and internal costs, as well as costs that
are more difcult to measure (social costs, less tangible
costs).
(3) Decision-making: it is the linking of relevant factors for
the feasibility and protability of an investment. Some
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D. Cicone Jr. et al. / Energy Policy 36 (2008) 991998 993

factors can be monetarized, others can be unied and  Job offers (quantity and quality)
others can be still characterized qualitatively. There-  Potential of large-scale adoption of the region
fore, the decision-making considers all these questions
in order to choose the correct options. 2.3. Analytic hierarchy process (AHP)

After dening the indicators (analysis factors), the Hierarchical analysis is a powerful and exible approach
evaluation matrices are created. For the criteria that can when it comes to decision-making, it helps to determine
be quantied, there is an absolute value, while for the priorities and also to identify the best option within a
qualitative factors the HAP that utilizes the paired number of possible alternatives, taking into account both
comparison as a decision-making tool shall be used. Each qualitative and quantitative aspects, through the reduction
area traditionally subdivides itself in diverse items to be of complex decisions to decisions that can be compared
evaluated, as listed below, but this can be adapted to each through the paired comparison. AHP does not only help
situation analyzed (Boarati, 2003): decision makers to arrive at the best option, but also
Technicaleconomic factors: provides a clear view or understanding of why such
alternative is the best. AHP is executed in three phases:
 Cost of the enterprise (US$/kW) structuring, judgments and synthesis of the results (Udaeta,
 Supply of fuel (regulated or free) 1997).
 Cost/difculty of maintenance (frequent maintenance or The structuring phase consists of obtaining the decision
not and the availability of national components) model, which in AHP is in the form of a hierarchy. Fig. 2
 Cost of the energy (OR$/MWh) shows an example of a three-level hierarchy model.
 Distance between the spring and the center of consump- In the next phase (judgment), the elements of a
tion hierarchical level should be compared among themselves.
 Time of construction According to psychological experiments, the human brain
 Availability of the form of energy in the region has a limit of 9 articles in simultaneous comparisons.
 Time of return of the investment Therefore, the number 9 arises as a limit of elements for
 Domination of technology each hierarchical level. However, for hierarchies with more
 Capacity factor than three levels, this limit applies for each knot. In the
 Motivational mechanisms model presented in Fig. 3, there would have been at most
 Commercialization of excess 18 subcriteria (9 for each criterion). This rule applies to all
the levels, except the last one (alternatives).
Environmental factors: There are two types of designs: bottom-up and top-
down. The bottom-up design is useful when the alternatives
 Nature of the fuel (renewable or not) better understood than the objectives and includes the
 Atmospheric pollution following steps: identication of the alternatives, listing of
 Water pollution the pros and cons of each alternative and obtaining of the
 Pollution of soil criteria and of the objective of the decision from the pros
 Size of affected area and cons listed previously. The top-down design is better
 Facility for obtaining of the environmental licenses applied in cases of strategic decisions where the objectives
 Emission of greenhouse effect gases are better understood compared to the alternatives. These
are the steps of a top-down design: identication of the
Political factors: main objectives of the decision, identication of the
subobjectives, criteria, subcriteria, etc. and the grouping
 Availability of the fuel of the alternatives in the last hierarchical level. After the
 Risk of exposure to foreign exchange rates structuring of the decision model, the next phase of the
 Opposition from the population AHP will be judgment by specialists (people who really
 Properties of the energy source understand the subject in question). A classic example of
 Governmental support the two-level hierarchy is shown in Fig. 4. The objective is
 Regulatory implications to estimate the distance between Philadelphia and the cities
present in the second hierarchical level.
Social factors: In this case, an experienced air passenger was considered
the specialist. His judgment was based on a paired
 Atmospheric contamination comparison analysis, where he compared which of the
 Contamination of the waters two cities would be more distant from Philadelphia using
 Contamination of soil the Fundamental Scale of Saaty (a scale graded 19, based
 Sonorous contamination in the double trichotomy of the human brain behavior).
 Secondary utilities (if the use of the resource produces According to the judgments in Table 1, the specialist
secondary or collateral benets) considered, for example, Tokyo a little more distant than
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994 D. Cicone Jr. et al. / Energy Policy 36 (2008) 991998

OBJECTIVE OF THE DECISION

e.g. SELECT AN ALTERNATIVE

CRITERION 1 CRITERION 2 CRITERION 3 CRITERION 4

ALTERNATIVE 1 ALTERNATIVE 2 ALTERNATIVE 3

Fig. 2. Hierarchical decision in three levels.

OBJECTIVE OF THE DECISION

e.g. SELECT AN ALTERNATIVE

CRITERION 1 CRITERION 2

SUB-CRITERION 1 SUB-CRITERION 2 SUB-CRITERION

S 3 SUB-CRITERION 4 S
SUB-CRITERION 5

ALTERNATIVE 1 ALTERNATIVE 2 ALTERNATIVE 3

Fig. 3. Hierarchical decision in four levels.

DISTANCE TO PHILADELPHIA

TOQUIO CAIRO CHICAGO LONDRES MONTREAL SAN FRANCISCO

Fig. 4. Estimation of the distance to Philadelphia (Saaty, 1991).

Table 1 approach, is recommended:

Matrix of judgments for estimation of the distance to Philadelphia (Saaty,
1991) A  P lMAX  P.

CAI TYO ORD SFO LGW YMX 3. The case of the airport of Congonhas
Cairo (CAI) 1 1/3 8 3 3 7 From the information available in Moreira (2005) and
Tokyo (TYO) 3 1 9 3 3 9
from the utilization of the software Decision Lens the
Chicago (ORD) 1/8 1/9 1 1/6 1/5 2
San Francisco (SFO) 1/3 1/3 6 1 1/3 6 major resources, both from the supply and demand side of
London (LGW) 1/3 1/3 5 3 1 6 views, are considered in this work. From the calculation of
Montreal (YMX) 1/7 1/9 1/2 1/6 1/6 1 the potencies and listing of the priorities by the specialists
of the GEPEA/USP a ranking of energy options that help
the decision maker are created.
Cairo. The last phase of the AHP consists of obtaining and
analyzing the results. The relative distance to Philadelphia 3.1. Resources considered
can be obtained by the auto vector P of the matrix of
judgments A that satises Eq. (4), where lMAX is the 3.1.1. Resources from the supply side
maximum auto value. For further consultation of the AHP
theory, the book entitled Analytic Hierarchy Process A. Biogas: In Congonhas 54.688 m3 of treated water
and whose author is Thomas L. Saaty, the creator of this supplied by the Company of Basic Sanitation of the
 ARTICLE IN PRESS
D. Cicone Jr. et al. / Energy Policy 36 (2008) 991998
State of Sao Paulo (SABESP) and 72.402 m3 of water
originating from artesian wells are consumed annually.
Today, part of this water is utilized for various
purposes like cooling of equipment, washing of the
patio, gardening etc., such that the organic content of
the sewer produced is considerably smaller than the
sewer usually found in treatment stations, therefore it
should be considered that the potency will be less than
estimated.
B. Incineration of solid residues: The potential of utiliza-
tion of the residues in the Airport of Congonhas is
limited, given that the quantity of wastes produced is of
only 120 ton per month, but this option can be
considered.
C. Eolic energy: In case of the Airport of Congonhas, this
resource will not be considered due to lack of space for
implantation of the turbines and mainly due to the
height of the propellers that would interfere in the
trafc of the airplanes.
D. Photovoltaic systems: The potential of utilization of
photovoltaic energy in the Airport of Congonhas is
considerable. There is a mean insolation of approxi-
mately 5.5 kWh/day m2 for the region where the airport
is located, in the Metropolitan area of Sao Paulo. The
total area of the airport is 35.217,35 m2. For the
calculation, it shall be considered that only 30%
(10.500 m2) of this area can be used to install solar
collector panels.
E. Fuel cell: The potentiality of use of the fuel cell in the
Airport of Congonhas is restricted by two factors:
It will be hard to limit the fuel to be used in the fuel
cells, given that the consumption of the airport will be
smaller when the amount supplied is considered
(presently the supplier is COMGAS, in the case of
natural gas).
The real potential of adoption of the fuel cells is only
limited by the airports demand for this type of energy.
Therefore, it can be said that the use of fuel cells is
equivalent to the demand of the airport, which is
22.4 GWh/year. Naturally, due to the high cost, in short
and medium terms, the cell fuels would only cover for
the most critical functions.
F. Cogeneration: The capacity of energy production by
cogeneration is large enough to meet all the demands of
the airport as there are distribution networks of natural
gas in the proximities. Therefore, the potential of
utilization of natural gas cogeneration is at least
22.4 GWh/year. Cogeneration can either be achieved
by micro-turbines (or by internal combustion engines)
or by water vapor.
3.1.2. Resources from the demand side
A. Energy storage: One of the techniques of energy storage
is the possibility to store energy in the form of heat or
cold, for utilization in periods of high demand, the so-
995
called, peak periods. In the case of Congonhas, the
period between 11 pm and 6 am present extremely
moderate energy consumption, where the production
of ice can be considered. The ice could then be stored in
thermo accumulators, for cooling of the environment
during the commercial hours when there is elevated
energy consumption as this will help reduce the total
energy consumption.
Therefore, this is a measure of demand-side manage-
ment, but does not aim at saving energy, but at an
economic prot from the use of cooling equipment in
periods when the tariffs are low.
B. Efficient environmental projects: The best utilization of
the natural lighting at the airport, by means of projects
based on efcient solutions of bioclimatic architecture,
would avoid the conventional energy consumption for
lighting. Presently, lighting in the airport is necessary
throughout the commercial period.
The architecture of the airport can be considered
sustainable from the energy point of view, if the use of
its principles and strategies help reduce the environ-
mental impact of the buildings and the consumption of
the electric energy from the existing resources. In this
case, the utilization of natural lighting, both in the
expansion project and in the old installations, would
occur through the opening of lateral and superior
windows, but avoiding excessive heat penetration and
degradation of the environment.
C. Substitution of the air conditioning: The substitution of
thermostats and the adjustments of the air conditioning
in a period of 10 years is a relevant measure on
energy saving, considering the performance and ef-
ciency of the equipment and the fact that the
air conditioning is responsible for about 37% of
the electricity consumption in the airport. Obsolete
devices present lower performances and signicantly
higher consumption when compared to modern tech-
nologies.
D. Substitution of fuels: The substitution of diesel, a fuel
that is utilized in the transport sector of the airport, by
other energy resources, does not imply in economy of
potential energy. In this case, the intention is to obtain
economic and environmental benets, since all the
contemplated alternativesbiodiesel, natural gas and
alcoholhave been proved to cause less pollution and
harm to the environment than diesel.
3.2. Decision tree
The rst step for the determination of the ranking of the
energy resources through the AHP is the construction of a
decision tree. This is achieved by listing the main objective,
the criteria, the subcriteria and nally the alternatives.
Fig. 5 illustrates a decision tree that was constructed by use
of the Decision Lens software. Fig. 6 shows a list of the
alternatives using the same software.
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996 D. Cicone Jr. et al. / Energy Policy 36 (2008) 991998
Fig. 5. Decision tree.
Fig. 6. List of alternatives.
3.3. Ranking of the alternatives
After the attribution of values and the paired compar-
ison of each one of the subcriteria and of the alternatives, a
number of energy options are created. This can be observed
in Fig. 7.
From Fig. 7, it is evident that the resource that is most
indicated for use is the demand resource Efcient
Environmental Projects and that the least indicated is
the waste incineration. It is good to mention that this is a
global result, but in case we consider only one of the
criteria the result can be different. This is presented in
Fig. 8, and shows ranking of the environmental aspects.
In Fig. 8, it is evident that the most recommended
resource is fuel cell. This type of analysis can also be
utilized for the subcriteria. It is possible to have a complete
vision of the analysis of sensitivity through a graph
available in the software. Fig. 9 shows this graph.
3.4. Analysis of the case of the airport of Congonhas
From Fig. 7, it is observed that the best resources, in
terms of position in the ranking and considering the four
aspects (technicaleconomic, environmental, social and
political) simultaneously, are the demand-side resources.
From the sensitivity (Fig. 9) it is observed that this
happens because the resources receive medium to good
results when all four aspects are considered, while the
supply-side resources receive bad to medium results in all
aspects. To illustrate this, waste incineration which
received bad results on the technicaleconomical, environ-
mental and political aspects and a medium result in the
social aspect is quoted. Contrary to this, Efcient
Environmental Projects received three good results and
only one medium result.
It is interesting to observe how in integrated resource
planning (IRP), a solution that can be good from the
economic point of view, could be bad in the general
classication. This shows the importance of the evaluation
of the full costs in energy planning that largely contributes
to clean development.
4. Conclusions
Decision supporting tools can be very helpful for the
integrated resource planning (IRP), as in this kind of
planning aspects that are not always easy to quantify must
be compared.
The analytic hierarchy process (AHP) is an interesting
way of quantifying these aspects, attributing relative values
to each one of the options and summing up these values in
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D. Cicone Jr. et al. / Energy Policy 36 (2008) 991998 997

Fig. 7. Ranking of the alternatives.

Fig. 8. Ranking of environmental aspect.

Fig. 9. Graph of sensitivity.

order to nd a better solution for the problem. Apart from
that, softwares like Decision Lens have sensitivity
analysis tools that help determine up to which point an
alternative is no longer viewed as the best solution for the
problem. In this way, the utilization of the AHP has proved
to be an efcient form of modeling and operationalization
of full costs, especially in the consideration of the
qualitative aspects of the analysis.
In the present state of energy planning, where not only
the economical aspects are relevant in a decision, the
utilization of tools and methodologies similar to those
proposed in this work are fundamental, especially when the
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998 D. Cicone Jr. et al. / Energy Policy 36 (2008) 991998

intention is rational use of energy and most important, Custos Completos. Dissertac- ao de mestrado apresentada a` Escola
sustainable development. Politecnica da Universidade de Sao Paulo, Sao Paulo.
Moreira, E.M., 2005. Modelamento energetico para o desenvolvimento
limpo de aeroporto metropolitano baseado na losoa do PIR O
Acknowledgment caso da metropole de Sao Paulo. Dissertac- ao de mestrado, GEPEA/
USP.
To FAPESP for support with the research, which Udaeta, M.E.M., 1997. Planejamento Integrado de Recursos Energeticos
resulted in this paper. para o Setor Eletrico -PIR- (Pensando o Desenvolvimento Sustenta-
dos). Tese de Doutorado, Escola Politecnica da Universidade de Sao
Paulo, Brasil.
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Livro, Sao Paulo.
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Hidreletricidade e Termeletricidade com Gas Natural atraves dos