ABSTRACT
In the present era of accelerating social and technological change, forecasting, or the assessment of future states of the system, has become integral to policy formulation. Forecasting facilitates the development of preemptive strategies which may divert or rechannel the debilitating effects of change. As noted throughout the new national energy plan (NEP II), forecasting is especially vital to the creation of viable energy policies. William Asher explains that
Policy makers involved with America's energy issues have learned a great deal about the importance of forecasting in the formulation of energy policy. The electricity shortages beginning in the mid-1960s, the recent oil and gas shortages, and the chronic problem of energy-related pollution all point to both the necessity and the difficulty of energy fore-casting.... Energy forecasting is required to prevent actual shortages of energy supplies and, more broadly, to avoid the situations in which policymakers are forced to provide energy very ineffectively. In fact, energy fore-casting is a crucial step in the policy for any aspect of energy use that requires substantial "lead times" for development or involves physical limits imposed by resource availability [1].
