Unraveling the Historical Economies of Scale and Learning Effects for Desalination Technologies

Mayor, B. (2020). Unraveling the Historical Economies of Scale and Learning Effects for Desalination Technologies. Water Resources Research 56 (2) e2019WR025841. 10.1029/2019WR025841.

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Abstract

As a technology develops and matures, both economies of scale and the lessons learned through experience drive down the cost over time. This article analyzes and separates the effects of economies of scale and learning through experience on historical cost reductions for three mature desalination technologies: multi‐effect distillation (MED), multi‐stage flash (MSF) distillation, and reverse osmosis (RO). The analysis suggests that learning has been the dominant driver for cost reductions, with learning rates of 23%, 30%, and 12% for MED, MSF, and RO, respectively, when the effects of scale are removed. The highest influence of economies of scale is found for MED, with an exponential scale coefficient of 0.71 and the largest difference between a traditional or scale‐free estimation of the learning rate. MSF and RO showed smaller differences between the traditional and de‐scaled learning rates (only 3%), pointing at learning as the main factor driving their historical cost reductions. However, a trend break observed over the last 10 years mirrors an exhaustion of the potential for technical improvements, as well as an increasing complexity and nonlinearity of the factors influencing the systems' cost. The findings provide useful data and insights for integrated and economic modeling frameworks, while providing guidance to prevent overestimations of the learning effect due to the confounding influence of economies of scale effects associated to historical unit upscaling processes.

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