Modelling the energy transition: A nexus of energy system and economic models

Abstract

Climate change induced policies impose wide-ranging implications throughout the whole energy system and influence various sectors of the economy. To analyse different decarbonization pathways for the energy system, existing models have traditionally focused on specific energy sectors, adopted specific research perspectives, assessed only certain technologies, or studied isolated components and factors of the energy system. However, few efforts have been undertaken to successfully model a broader picture of the energy-economic system. In this conceptual paper, we propose linking top-down and bottom-up models to represent: distributed generation and demand, operations of electricity grids, infrastructure investments and generation dispatch, and macroeconomic interactions. We review existing work on modelling the different dimensions of the energy transition to understand why models tend to focus on certain features or parts of the energy system. We then discuss methodologies for linking different type of models. We describe our integrated modelling framework, and the challenges and opportunities on linking models based on their capabilities and limitations.

Modelling the energy transition: A nexus of energy system and economic models