Aim and Scope of DEFINE, Objectivesfor this Workshop

Presentation at the DEFINE Technical Modelling Workshop

Michael Miess Stefan Schmelzer

Institute for Advanced Studies (IHS), Vienna

November 21, 2012

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Introduction

Sketching what DEFINE is aboutGeneral Aim and Scope of DEFINEModel Building - Scientific PublishingPoints of Intersection in DEFINETimeline of WPs

Modelling Objectives in DEFINE

Objectives and Approach of this Technical Modelling WorkshopObjectivesApproach of the Workshop

Milestones

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Aim of DEFINE IElectromobility is often seen as the solution to combining an individualtransportation system with ecologically sustainable development.

However, DEFINE will be defined broader, analysing an anticipated change inthe mobility paradigm from a fossil fuel-based individual transportationsystem to one relying on electromobility, public transport and in-betweensolutions.

Thus, DEFINE aims at:

I Estimating and assessing the full economic costs associated with ahigher share of electric mobility, taking account of the impact onelectricity grids, the provision of electric energy and environmentalexternalities such as GHGs.

I The development of an evaluation framework, with a hybrid CGEmodel and two electricity market models as its core, to meet this end.

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Aim of DEFINE III Models are constructed in a way that allows for mutual inputs between

the models (not necessarily a soft link), where results of the one modele.g. enter the other as exogenous (e.g. scenario) parameters.

I Comparable scenarios are simulated in the various models, withdifferent foci and outcomes. Evaluation Framework for Austria andGermany is extended to Poland.

I Integrated, comparative studies on the impact of a large-scale shift toelectromobility for Austria, Germany and Poland are the result.

I The environmental impacts (costs and benefits) are quantifiedaccording to the outcomes of the modelling framework.

I Policy briefs by various partners and a policy guide (The “Path toElectromobility”) are published at the end of the project.

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Scope of DEFINE: Evaluation Framework IDEFINE is focused on the development of an evaluation framework for ahigher share of electromobility, the envisaged components of which are:

I A hybrid top-down bottom up CGE model, with a detailed depiction ofboth the mobility behaviour of households and the electricity sector.

I Two detailed electricity market models, providing a more detailed viewon the electricity market, the production of electricity, the electricity gridand electric vehicles as storage devices for electric energy.

I Scenario data on the development of vehicle technology (e.g. vehiclestock projections), market potential of EVs, potential user groups andtypical usage patterns, etc., enter models for simulation purposes.

I Emission reduction potential of electric mobility and the quantificationof environmental costs and benefits conclude the evaluation framework.

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Scope of DEFINE: Evaluation Framework IIA consumer survey and subsequent micro-estimation for Austria and Polandfurthermore provide

I An empirical basis for the CGE model and

I Allow for the construction of detailed micro models (discrete choicemodels on household level) depicting mode choices and the take-on ofelectric vehicles by consumers.

I Parameters and outcomes from the micro model can enter the CGEmodel as exogenous parameters, and vice versa.

I A link between the micro and macro models might be constructed.

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Model Building - Scientific PublishingThe CGE Model will be collaborative work that will be jointly available forscientific publishing.

I IHS will do most of the programming work and Austrian data.

I German/Polish data from DIW/CASE.

I Senior expertise from DEFINE workshop 2 (now) and workshop 4 (fall2013), and bilateral collaboration.

I Until now, IHS has made no major modifications to model developed byBöhringer and Rutherford (2008) comparable to extensions envisagedin DEFINE.

I “We are the workers/learners, you are the experts.” ,

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Points of Intersection in DEFINE I: Hybrid CGE Model(WPs 1, 6)

I Collaboration regarding development of hybrid CGE model.

I Input of data and price-demand elasticities from WPs 3,8.

I Input of scenario data (WP 4), development of model in view ofscenarios.

I Interaction between CGE model and electricity market models (WPs2,7).

I Provision of German and Polish Macro-Data (WPs 6, 10), in the form ofa SAM (Social Accounting Matrix).

I Application of hybrid CGE model to Germany (WP 6) and Poland (WP10).

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Points of Intersection in DEFINE II: Electricity MarketModels (WPs 2, 7)

I Collaboration regarding the development of the two electricity marketmodels.

I Input of scenario data (WP 4), development of model in view ofscenarios.

I Interaction between electricity market models and CGE model (WPs1,6).

I Application of German electricity market model to Poland (WP 10).

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Points of Intersection in DEFINE III: ConsumerSurvey and Micro-Estimation (WPs 3, 8)

I Data requirements of CGE model are discussed at Kickoff Workshop.

I Survey design is elaborated until Workshop 3 (Scenario Building andData Implementation, month 10, February/March 2013).

I Survey design is presented at Workshop 3.

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Points of Intersection in DEFINE IV: Scenarios (WPs4, 6, 7)

I Scenario building for transport and energy in WP 4.

I Implementation of scenarios developed in WP 4 into hybrid CGE model(WP 6).

I Implementation of scenarios developed in WP 4 into electricity marketmodels (WP 7).

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Points of Intersection in DEFINE V: EmissionReduction Potential (WP 5)

I Inputs from WPs 2, 4, 7 to calculate emission factors of additionalelectricity demand for electric vehicles.

I Comparison of scenarios as input for quantification of impact one-mobility on GHG emissions.

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Points of Intersection in DEFINE VI: Application toPoland (WP 10)

I Provision of Polish price-demand elasticities for CGE model (WP 8).

I Provision of Polish data for CGE model, calibration (WPs 6, 8).

I Provision of Polish data for German electricity market model, calibration(WP 7).

I Transformation of Austrian and German scenarios into “Polish”scenario, application in CGE model and German electricity marketmodel.

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Timeline of DEFINE

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WP2: Elaborations on the Electricity Market Model DIW, ESEA

WP1: Elaborations on the General Equilibrium Model IHS, DIW, CASE,

ESEA

WP4: Scenario Building for Transport & Energy OEI, UBA, DIW, IHS, ESEA

WP6: Completion of the General Equilibrium Model & Application

IHS, DIW, CASE, ESEA, UBA

WP5: Emission Reduction Potential of Electric Mobility

UBA, OEI, IHS

WP3: Survey and Estimation of Consumer Patterns and Elasticities

IHS

WP7: Completion of The Electricity Market Model & Application DIW, ESEA, IHS

WP12: Coordination, Project Management and Reporting ALL

WP11: Dissemination ALL M8

M1

Legend

Milestones:

M1 – General equilibrium core model

M2 – Technological details on the power grids and

the electricity sector

M3 - Elasticities and micro data

M4 – E-mobility scenarios for energy and transport

M5 – Complete general equilibrium model with

simulation tools

M6 – Complete elec-

tricity market model

with simulation tools

M7 – Prepared data for Poland

M8 – Final dissemination report

Workshops:

WS1: Kickoff

WS2: Technical modelling workshop 1

WS3: Scenario building and data implementation

WS4: Technical modelling workshop 2

WS5: Preliminary information for stakeholders

WP9: Quantification of Environmental Benefits CASE, IHS

WP10: Example Application: Poland

CASE, DIW, IHS

M2

M3

M7

M6

M5

M4

May

2012Oct. 2012 Jan. 2013 April 2013 July 2013 Oct. 2013 Jan. 2014 April 2014 July 2014 Oct. 2014

WS1 WS2 WS3 WS4 WS5

WP8: Analysis of Household Demand and Data Provision CASE, DIW, IHS

Modelling Objectives for CGE Model in DEFINE

I Inclusion of mobility good in SAM/nesting structure, endogenousdecision on transport mode and vehicle purchase/use by household,

I Stock-Flow Consistency for vehicle technologies, substituting a stock ofconventional vehicles (CVs) with electric vehicles (EVs) and PHEVs(Plug-In Hybrids),

I Modelling the interaction between changes in mode choices, vehiclepurchase choices and the energy system (mostly in regard to theelectricity producing system),

I Reconciling the CGE model with input from vehicle stock projectionmodels (OEI/UBA) and electricity market models (DIW/TUW),

I Capability to analyse costs/benefits of shift in mobility paradigm topublic transport/inter-operability, etc., including shift to electromobility.

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Objectives for this WorkshopThe IHS dynamic CGE model has been mainly adapted from the literature,Böhringer and Rutherford (2008). Adaptions so far, among others:

I Extension to several sectors,

I Fitted to Austrian data,

I Elaborate government agent, equipped with various endogenous taxesand refinancing instruments,

I Scenario instruments (endogenous investment subsidies),renewable-quota scenario, etc.

The changes necessary for DEFINE, however, will go deeper than theadaptations above. Thus, the goal for this workshop is to lay the foundationfor the major extensions of the CGE model mentioned on the previous slide.

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’Electromobility’ in a Broader Sense

I Modelling mobility in a way that allows for the assessment of theeconomic costs/benefits of a large-scale shift to electromobility,considering interactions with the energy system.

I However, a sole shift to electric cars, not altering current behaviour andintensity of use regarding individual transportation by cars, might not bea sustainable solution, especially considering different properties ofelectric cars (limited range, dependence on rare earth elements, etc.)

I Thus, it is definitely desirable to incorporate also a shift to publictransport, combined with an increased uptake of EVs and hybrids.

I More individual transport-oriented scenarios could be compared with atleast one scenario concentrating on a change in the mobility paradigmto inter-operability between individual and public transport, extension ofpublic transport, etc.

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Approach and Method of the WorkshopSince the extensions to be implemented in the dynamic CGE Model gobeyond what has been currently implemented, this workshop shall pave theway for the further modelling efforts in DEFINE, providing first solutions and aclear direction to go into. Therefore,

I We want to encourage a creative, outgoing atmosphere withbrainstorming on different problem sets posed in the DEFINE project.

I Work on the Model itself in GAMS, trying to find ways to implement thenecessary model features.

I Collect the inputs and experience from renowned experts (you!) in thefield to help us meet the project goals.

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Selected MilestonesI M1 - General equilibrium core model (WP 1): June 2013

I M3 - Elasticities and micro data (WP 3): June 2013

I M4 - E-mobility scenarios for transport and energy (WP 4): May 2013

I M5 - Complete general equilibrium model with simulation tools (WP 6):February 2014

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ReferencesBöhringer, C. and Rutherford, T. (2008). Combining bottom-up and top down. Energy

Economics, 30, 2:574–596.

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Thank you for yourattention!

Michael Miess Stefan SchmelzerPhone: +43-1-59991-138Fax: +43 1 59991-555e-mails: miess@ihs.ac.at, schmelzer@ihs.ac.at

Stumpergasse 56 / A-1060 Vienna

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