An Investment Analysis Framework to Prioritize Capital Projects of an Electric Distribution Utility Using Analytic Hierarchy Process

The study focuses on how capital investment decisions can properly take into account not only the cost savings but also the performance impact on the activities and strategic goals of an organization. This can be addressed by an investment decision analysis framework that jointly applies the principles of multi-attribute decision modeling, activity-based costing and management (ABC&M), capital budgeting and capital rationing. This framework covers the determination of cash flow variables using activity-based costing data, instead of the traditional capital budgeting concept and a new method of capital rationing and/or prioritizing, given the limited resources of the company