This approach leaves the scrubber-installation decision to the manager of the plant, who can figure out what the scrubbers cost before deciding how to proceed. For example, if the scrubbers turn out to be unexpectedly expensive, the plant manager can install fewer of them.
This flexibility translates into less variability in the effective regulatory burden and hence less variability in the price of energy to consumers. 12 Scrubbers and high-quality liquid assets What does all this imply for the design of the LCR? Let’s work through the analogy in detail.