Science, People & Politics issn:1751598x. Iss. one 2017

ENERGY SPECIAL | 12

XX "Unlike conventional generation, most
XX renewable power plants can be developed
XX only in certain locations, where the resource
XX is strongest. This requires the deliberate
XX design of a transmission system to reach
XX those areas, rather than passively allowing
XX generation to be developed around existing
XX or planned transmission lines."

....................................... P 57. Regulatory Indicators for Sustainable Energy.
February, 2017. Published by the World Bank.

CONTINUED FROM PAGE 10...
the formula such that actual or predicted earnings look good enough to attract a loan for energy
infrastructure. Assume a stable economy and non war torn country, even if you are at war.
That's what the archives suggest Britain did as World War II drew to a close. For now don't
worry about whether unforeseen ethical problems could sink your loan request. First assess
your financial case. Do not assume ethics might not be an issue.

Let's take the formula term by term. It is an acronym known as "earnings before interest, tax,
depreciation and amortization" (EBITDA), and is probably unfamiliar to most scientists and
politicians. Merriam Webster places the word in the lower 20 percent looked up. An analogy,
therefore, might help. I propose scientists conceptualise earnings on the left hand side of the
equation as they would pressure.

Pressure indicates temperature and volume at the time and place of measurement. Take air
pressure in a room. Might a hidden open door expand the surface over which pressure is exert-
ed, thus reducing local impact. Could measuring equipment be broken, not moving smoothly,
or not sensitive enough to give a meaningful measurement for the degree of detail needed.

Scientists considering pressure have such provisos engrained in their thinking. They envision
size, dimensions and strength of a container, ability to withstand uniformly the pressure, likely
volume throughputs and flow variations. Is there a triple point, that is a temperature and volume
at which all three phases of a substance - gas, liquid and solid - co-exist? Are there temperature
-induced points of brittleness? Personal experience tells us money's behaviour is not dissimilar.

How does a banker or financial expert construct and think about earnings, and so loans?

EBITDA suggests it could be akin to how scientists think of pressure. Both a point in time and
space, and the culmination of many factors. Perhaps also as the politician thinks of an election
result. A number on the day resulting from many inputs of varying and overlapping scales.
Just as the pressure of a system determines its sustainability, coherence and resilience across
a range of conditions, so do earnings determine corporate or organisational viability.

Each term in EBITDA can be examined, as with calculus, range limits, stats, sample size and
content analysis one evaluates experimental results before publication. And each term can be

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Issue 1 (Jan-Mar), 2017............................................Science, People & Politics ISSN 1751-598X print (on request) and online