An Integrated Framework for Energy-Economy-Emissions Modeling: A Case Study of India PDF
Preview An Integrated Framework for Energy-Economy-Emissions Modeling: A Case Study of India
SPRINGER BRIEFS IN ENVIRONMENTAL SCIENCE Tejal Kanitkar An Integrated Framework for Energy-Economy- Emissions Modeling A Case Study of India 123 SpringerBriefs in Environmental Science SpringerBriefsinEnvironmentalSciencepresentconcisesummariesofcutting-edge researchandpractical applications across awidespectrum ofenvironmentalfields, with fast turnaround time to publication. Featuring compact volumes of 50 to 125 pages, the series covers a range of content from professional to academic. MonographsofnewmaterialareconsideredfortheSpringerBriefsinEnvironmental Scienceseries. Typical topics might include: a timely report of state-of-the-art analytical tech- niques,abridgebetweennewresearchresults,aspublishedinjournalarticlesanda contextualliteraturereview,asnapshotofahotoremergingtopic,anin-depthcase study or technical example, a presentation of core concepts that students must understand in order to make independent contributions, best practices or protocols tobefollowed,aseriesofshortcasestudies/debateshighlightingaspecificangle. SpringerBriefsinEnvironmentalScienceallowauthorstopresenttheirideasand readerstoabsorbthemwithminimaltimeinvestment.Bothsolicitedandunsolicited manuscriptsareconsideredforpublication. Moreinformationaboutthisseriesathttp://www.springer.com/series/8868 Tejal Kanitkar An Integrated Framework for Energy-Economy-Emissions Modeling A Case Study of India TejalKanitkar SchoolofNaturalSciencesandEngineering NationalInstituteofAdvancedStudies Bengaluru,India ISSN2191-5547 ISSN2191-5555 (electronic) SpringerBriefsinEnvironmentalScience ISBN978-3-030-18262-5 ISBN978-3-030-18263-2 (eBook) https://doi.org/10.1007/978-3-030-18263-2 ©TheAuthor(s),underexclusivelicencetoSpringerNatureSwitzerlandAG2020 Thisworkissubjecttocopyright.AllrightsarereservedbythePublisher,whetherthewholeorpart of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation,broadcasting,reproductiononmicrofilmsorinanyotherphysicalway,andtransmissionor informationstorageandretrieval,electronicadaptation,computersoftware,orbysimilarordissimilar methodologynowknownorhereafterdeveloped. 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Theregisteredcompanyaddressis:Gewerbestrasse11,6330Cham,Switzerland Abstract Themaincontributionoftheworkpresentedinthisbriefistheintegrationofthree modelingmethodsintooneframeworkinordertoaddressarangeofquestionsthat are of importance in the energy-economy-environment domain. Less developed countries especially the larger emerging economies such as India, China, South Africa, Brazil, and Indonesia are placed in a challenging situation. While they are growing rapidly with production in secondary and tertiary sectors fast overtaking primary agricultural activities, these countries still continue to face many challenges of ensuring the material well-being of large sections of their populationsandprovidingaccesstobasicservicessuchashealth,education,housing and energy. These challenges have been made more daunting by the realization of the impacts of climate change and the need to contribute to its mitigation. In this situation, these countries have to balance multiple requirements and constraints. Unlike developed countries, the economic systems in the less developed countries arestillchangingstructurallyataveryrapidpace.Thismakeslong-rangeforecasts of economic variables extremely uncertain. On the other hand, to ensure that irreversible climate change does nothappen, a certain amountof long-term energy planning is required. It is the task of mathematical models to provide a way of reconcilingthesedifferent,oftenconflictingrequirements. A review of the range of such existing models, including both large macroeco- nomicmodelsandtechnology-explicitenergymodels,showssomegapsinanswer- ingkeyquestionsthatmayberelevanttodevelopingcountries.Technology-explicit energymodelssuchasMarkAlandTIMESarebuiltspecificallytoaddressquestions relevant to the technological aspects of the energy sector and are not suitable for addressingquestionsabouttheeconomyingeneralandaboutincomesandincome distributions within the economy in particular. On the other hand computable general equilibrium (CGE) models consider the economy as a whole and model it usingaggregated productionfunctions andtherefore canneither capturethedetails of the technological energy sector nor capture the full scope of the details of the specificintermediateandendusesectorsoftheeconomy.Intheworkpresentedin this report, therefore, the attempt has been to integrate three different modeling v vi Abstract methodologiesintooneframework,calledtheintegratedmodelingframework(IMF) thatcanaddresssomeofthesegapsandattempttoanswerarangeofquestionsthat maybeparticularlyimportantfordevelopingcountries. The work presented here includes three main components: (a) Decomposition analysisofthepasttrendinemissionsintensityofGDP,intoitsparametriccompo- nents—primarily energy intensity of GDP and structural composition of the econ- omy.Basedonpasttrendsforthesefactors,morerobustscenarioscanbeconstructed forthefuture.Thiscomponentprovidesthebasisonwhichscenariosareconstructed inthenexttwocomponentsoftheIMF.(b)Thesecondmodelisbuilttoevaluatethe optimumenergysupplypathwaysundervariousresourceandemissionsconstraints, usingsimplelinearprogrammingtechniques.Theobjectiveofthiscomponentisto develop a methodology for determining energy options, specifically for the power sector,underavarietyofscenariosthatcapturethetechnicalandeconomiccharac- teristics of the power sector. (c) The third model is built to evaluate the impact of energypolicyonincomeandequityusinginput-outputanalysis.Themainobjective inthispartoftheworkistobuildamethodologythroughwhichtrade-offsassociated withpolicydecisionsinthepowersectorcanbeunderstoodandquantified. Keywords: Energy modeling; Energy-economy-emissions models; Integrated modeling framework; Input-output analysis; Structural path analysis; Decomposi- tionanalysis;Optimization;Generalalgebraicmodelingsystem Nomenclature a Upperlimitonnewinstalledcapacitythatcanbeaddedannually A Matrixofinter-industrytechnicalcoefficients AEM AnnualemissionsfromthepowersectorinyearT T Anncost Annualcostforperiodt t AP Cumulativepotentialforeachfuel F b Lower limit on new installed capacity that can be added or decommissionedannually BES Totalbaseloadcontributiontoelectricitygenerationinyear(T) T BY Baseyear C Matrixofendogenousfinalexpenditurecoefficients CB Carbonbudget(cumulativeemissions)between2010and2050 CC Capitalcostofenergysupplyovereachenergysource(F)andeach year(T) CF Grosscapitalformationinsectori ij d Discountrateforeachperiod D DemandforelectricityinyearT T DC Totaldepreciation ij DTH Taxpaidbyhouseholdclassestothegovernment ij E Energyuseinsectori i EC Rowvectorofenergycoefficients EF Emissionfactorforeachpowergenerationtechnology(intC/kWh) F EG ElectricitysuppliedbyexistingplantsinyearT F,T EM Emissionsfromsectori i EP Rowvectorofphysicalenergyconsumptionbyeachsector ES ElectricitysuppliedbyeachtechnologyinyearT F,T EX Amountofoutputfromsectorithatisexported ij f Totalfinaldemandofcommodityiinsectori ij f(cid:1) (n(cid:1)1)columnvectorofexogenousfinaldemand FC Fixedcost F,T vii viii Nomenclature FP Cumulativepopulationshareofhouseholdgrouph h GA Netcapitaltransfertothegovernmentfromabroad ij GC Finalconsumptionbygovernmentofoutputfromsectori ij GDP Gross domestic product in real terms, not corrected for inflation unlessotherwisespecified GE Directmonetarytransferfromthegovernmenttohouseholds ij GINI Coefficientofinequality h Vectorofexogenoushouseholdincome H Matrix of endogenous coefficients for distributing institution and householdincome H Totalendowment(income)ofhouseholds ij HA Monetarytransferreceivedbyhouseholdclassesfromabroad ij HC Final household consumption of all household classes of output ij fromsectori I Actualinjectionintothesector IA Factorincomeearnedfromabroadbycapitalandlabor ij IC InstalledcapacityforeachtechnologyinyearT F,T IG Totalincomeofthegovernmentfrompublicenterprises ij IM Valueofinputinsectorjthatisimported jj IPr Interestondebtpaidbyprivatecorporationstothegovernment ij ITH Indirecttaxpaidbyhouseholdclassesinpurchaseofcommodities ij L Laboremployedineachsector i LC Labororemploymentcoefficients M (n(cid:1)n)matrixofaccountingmultipliers A M (n(cid:1)n)squarematrixofdirecteffectmultipliers 1 M (n(cid:1)n)squarematrixofindirecteffectmultipliers 2 M (n(cid:1)n)squarematrixofcrossorclosedloopmultipliers 3 M 0 M (cid:3)I 1 1 M 0 (M (cid:3)I)(cid:1)M 2 2 1 M 0 (M (cid:3)I)(cid:1)M (cid:1)M 3 3 2 1 n Populationshareofhouseholdgrouph h NPER Numberofperiodsintheplanninghorizon NYRS Numberofyearsineachperiodt OBJ Objectivefunction PC Percapitaconsumptionattimet t PLF PlantloadfactororcapacityfactorforeachtechnologyinyearT F,T POP Populationattimet t PPr Totaloperatingprofitofprivatecorporations ij PPu Totaloperatingsurplusofpublicenterprises ij PuS Savingsaccountofpublicenterprises ij Q (n (cid:1) n) square matrix of inter-industry technical coefficients and endogenous coefficients for distributing institution and household income Nomenclature ix R (n(cid:1)n)squarematrixofendogenousfinalexpenditurecoefficients, endogenousvalue-addedinput shares,andendogenous coefficients distributingincometovalue-addedcategories RH Ruralhouseholds(hrangingfrom1to5—pooresttorichest) h RM Totalpurchaseofrawmaterialfromsectorsiforproducingoneunit ij ofoutputinsectorj SA Totalforeignsavings ij S (n(cid:1)n)matrixofaverageexpenditurepropensities SH Totalsavingsofhouseholdclasses ij SG Totalsavingsaccountofthegovernment ij SI ScenarioforGDPgrowthdominatedbyindustrialsectorgrowth SPrS Savingsaccountofprivatecorporations ij SS ScenarioforGDPgrowthdominatedbyservicesectorgrowth TC Taxpaidoninvestmentgoods ij TDSC Totaldiscountedsystemcost TE Taxpaidinexports ij TG Total tax accruing to government on account of purchase of ij commoditiesbygovernment TIG Taxpaidonthepurchaseofintermediategoodsbysectorj ij Tin Totalindirecttaxaccruingtothegovernment ij TPr Corporatetaxespaidbyprivatecorporationstothegovernment ij TY Targetyear UH Urbanhouseholds(hrangingfrom1to5—pooresttorichest) h v Vectoroftotalvalueadded V Matrixofendogenousvalue-addedinputshares VA Totalvalueaddedbylaborandcapitalforproductionofoneunitin ij sectorj VC Variablecost F,T w Vectorofexogenousvalue-addedincome X1 Scenario where the fraction of additional government expenditure on power comes from all sectors in equal proportion to their contributiontoGDP X2 Scenario where the fraction of additional government expenditure onpowercomesfromafewkeysectors x Vectoroftotaloutputs x Totalproductioninsectori i x(cid:1) (n(cid:1)1)columnvectoroftotaloutputofallnendogenousaccounts Y Matrix of endogenous coefficients distributing income to value- addedcategories Y Grossoutputofthesectoridistributedacrosseachsectorj ij y Incomeshareofhouseholdgrouph h y Vectoroftotalhouseholdincome Z Originalsquarematrixofinter-industrytransactions Z1 Scenariowithnorestrictiononemissions
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