diff --git a/src/discount.jl b/src/discount.jl
index 5677cf6..c2e20ac 100644
--- a/src/discount.jl
+++ b/src/discount.jl
@@ -56,9 +56,13 @@ end
 
 Calculates the discount factor to be used for a time period `t`
 using a fixed 'discount_rate`. There are two types of discounting
-available, either discounting to the start of the time period
-or calculating an approximate value for the average discount factor
-over the whole time period (`type="avg"`).
+available, either discounting to the start of the strategic period
+containing the time period (`type="start"`) or calculating an approximate
+value for the average discount factor over the whole strategic period.
+The average can be calculated either as a continuous average (`type="avg"`) or
+as a discrete average that discounts to the start of each year (`type="avg_year"`).
+The `timeunit_to_year` parameter is used to convert the time units of
+strategic periods in the time structure to years (default value = 1.0).
 """
 function discount(
     t::TimePeriod,
@@ -77,15 +81,14 @@ function discount(disc::Discounter, t::TimePeriod; type = "start", timeunit_to_y
 end
 
 function discount_avg(discount_rate, start_year, duration_years)
-    if discount_rate > 0
-        δ = 1 / (1 + discount_rate)
-        m =
-            (δ^start_year - δ^(start_year + duration_years)) / log(1 + discount_rate) /
-            duration_years
-        return m
-    else
-        return 1.0
-    end
+    δ = 1 / (1 + discount_rate)
+    return (δ^start_year - δ^(start_year + duration_years)) / log(1 + discount_rate) /
+           duration_years
+end
+
+function discount_avg_year(discount_rate, start_year, duration_years)
+    δ = 1 / (1 + discount_rate)
+    return sum(δ^(start_year + i) for i in 0:(duration_years-1)) / duration_years
 end
 
 function discount_start(discount_rate, start_year)
@@ -100,14 +103,19 @@ function discount(
     type = "start",
     timeunit_to_year = 1.0,
 )
-    start_year = _to_year(_start_strat(sp, ts), timeunit_to_year)
-    duration_years = _to_year(duration_strat(sp), timeunit_to_year)
-
-    if type == "start"
-        return discount_start(discount_rate, start_year)
-    elseif type == "avg"
-        return discount_avg(discount_rate, start_year, duration_years)
+    discount_factor = 1.0
+    if discount_rate > 0
+        start_year = _to_year(_start_strat(sp, ts), timeunit_to_year)
+        duration_years = _to_year(duration_strat(sp), timeunit_to_year)
+        if type == "start"
+            discount_factor = discount_start(discount_rate, start_year)
+        elseif type == "avg"
+            discount_factor = discount_avg(discount_rate, start_year, duration_years)
+        elseif type == "avg_year"
+            discount_factor = discount_avg_year(discount_rate, start_year, duration_years)
+        end
     end
+    return discount_factor
 end
 
 """
@@ -115,7 +123,14 @@ end
 
 Returns an overall weight to be used for a time period `t`
 in the objective function considering both discounting,
-probability and possible multiplicity.
+probability and possible multiplicity. There are two types of discounting
+available, either discounting to the start of the strategic period
+containing the time period (`type="start"`) or calculating an approximate
+value for the average discount factor over the whole strategic period.
+The average can be calculated either as a continuous average (`type="avg"`) or
+as a discrete average that discounts to the start of each year (`type="avg_year"`).
+The `timeunit_to_year` parameter is used to convert the time units of
+strategic periods in the time structure to years (default value = 1.0).
 """
 function objective_weight(
     t::TimePeriod,
diff --git a/test/runtests.jl b/test/runtests.jl
index 23e4704..565751c 100644
--- a/test/runtests.jl
+++ b/test/runtests.jl
@@ -1335,15 +1335,30 @@ end
         @test discount(disc, t) == δ^(i - 1)
     end
 
+    @test sum(
+        discount(sp, uniform_years, 0.06; type = "avg_year") for
+        sp in strat_periods(uniform_years)
+    ) ≈ 7.8017 atol = 1e-3
+
     @test sum(objective_weight(t, disc) for t in uniform_years) ≈ 8.435 atol = 1e-3
 
     uniform_day = SimpleTimes(24, 1)
-    periods = TwoLevel(10, 8760, uniform_day)
+    periods = TwoLevel(10, 5 * 8760, uniform_day)
+
+    @test sum(
+        objective_weight(sp, periods, 0.04; timeunit_to_year = 1 / 8760, type = "start") for
+        sp in strat_periods(periods)
+    ) ≈ 4.825 atol = 1e-3
+
+    @test sum(
+        objective_weight(sp, periods, 0.04; timeunit_to_year = 1 / 8760, type = "avg_year")
+        for sp in strat_periods(periods)
+    ) ≈ 4.468 atol = 1e-3
 
     @test sum(
-        objective_weight(sp, periods, 0.04; timeunit_to_year = 1 / 8760) for
+        objective_weight(sp, periods, 0.04; timeunit_to_year = 1 / 8760, type = "avg") for
         sp in strat_periods(periods)
-    ) ≈ 8.435 atol = 1e-3
+    ) ≈ 4.382 atol = 1e-3
 
     uniform_day = SimpleTimes(24, 1u"hr")
     periods_unit = TwoLevel(10, 365.125u"d", uniform_day)