Techno-EconomicStandard Methodology
Scenario Analysis
AIA's approach to building multiple plausible futures — regional gas-market scenarios, power-system scenarios and renewable-energy scenarios — to stress-test strategy and infrastructure decisions against structurally different outcomes rather than a single forecast.
What it is
A structured technique for developing multiple, internally consistent futures (e.g. differing renewable-energy build rates, differing regional gas-demand pathways) so that strategic or infrastructure decisions are tested for robustness rather than optimised against a single forecast.
Problem it solves
Single-point forecasts understate risk in volatile, long-horizon sectors (energy, infrastructure); scenario analysis makes the range of plausible futures explicit and testable.
When to use
- Long-horizon infrastructure or energy investment decisions
- Regional or national master-planning exercises with high structural uncertainty
- Where a client needs to understand downside/upside cases, not just a base case
Key questions
- What are the structurally different futures the sector could take?
- How does gas/power demand and supply differ under each future?
- Which strategic choices are robust across most or all scenarios?
Inputs
- Macro and sector data (production, demand, tariffs)
- Policy and regulatory trajectories
- Technology cost and adoption trends
Steps
- 1Define scenario driversIdentify the key uncertain variables (e.g. renewable build rate, gas price, regulatory pathway).
- 2Construct scenariosBuild 2-4 internally consistent scenarios spanning the plausible range of outcomes.
- 3Model each scenarioQuantify supply/demand, pricing or system requirements under each scenario.
- 4Test strategy robustnessAssess which strategic or investment choices perform acceptably across scenarios.
Outputs
- Scenario narratives and quantified outcomes
- Robustness/sensitivity assessment of strategic options
Source visuals
scenario analysisenergy scenariosregional gas master plansensitivity analysis
Related methodologies
Custodian: Corporate Support. Internal (staff access). Source: AIA_Methodologies_2024.pptx (slides 75, 133, 134, 144, 145, 146, 147, 148, 151, 153, 167, 168, 169, 170, 171, 172, 173, 180).