Potential errors when fitting experience curves by means of spreadsheet software

Abstract

Progress ratios (PRs) are widely used in forecasting development of many technologies; they are derived from historical data represented in experience curves. Fitting the double logarithmic graphs is easily done with spreadsheet software like Microsoft Excel, by adding a trend line to the graph. However, it is unknown to many that these data are transformed to linear data before a fit is performed. This leads to erroneous results or a transformation bias in the PR, as we demonstrate using the experience curve for photovoltaic technology: logarithmic transformation leads to overestimates of progress ratios and underestimates of goodness of fit. Therefore, other graphing and analysis software is recommended.