Energy Transition

Water Body Temperature Model for Assessing Climate Change Impacts on Thermal Cooling

We develop and test a physically based semi-Lagrangian water body temperature model to apply climatological data and thermal pollution from river-based power plants to historical river flow data in order to better understand climate change impacts on surface water temperature and thermal power plant withdrawal allowances. The model is built for rapid assessment and use in Integrated Assessment Models. We first test the standalone model on a 190km river reach, the Delaware River, where we have detailed flow and temperature data. An R2 of 0.88 is obtained on hourly data for this initial test. Next, we integrate the standalone temperature model into a series of models—rainfall-runoff model, water demand model, water resource management model, and power plant uptake and release model—for the contiguous USA (CONUS), with about 19,000 segments total. With this system in place, we then validate the standalone water temperature model within the system for 16 river stations throughout the CONUS, where we have measured daily temperature data. The model performs reasonably well with a median R2 of 0.88. A variety of climate and emissions scenarios are then applied to the model to test regions of higher vulnerability to river temperature environmental violations, making use of output from two GCMs and six emissions scenarios focusing on projections out to 2050. We find that the two GCMs project significantly different impacts to water temperature, driven largely by the resulting changes in streamflow from the two models. We also find significantly different impacts on the withdrawal allowed by thermal power plants due to environmental regulations. Potential impacts on generation are between +3% and -4% by 2050 for the unconstrained emissions case and +3.5% to -2% for the stringent GHG mitigation policy (where 1% is equivalent to 32 TWh, or about 3 billion USD/year using 2005 electricity prices). We also find that once-through cooling plants are most vulnerable to climate change impacts, with summer impacts ranging from -0.8% to -6% for the unconstrained emissions case and +2.1% to -3.7% for the stringent GHG emissions case.

The Future of Solar Energy: An Interdisciplinary MIT Study

Solar electricity generation is one of very few low-carbon energy technologies with the potential to grow to very large scale. As a consequence, massive expansion of global solar generating capacity to multi-terawatt scale is very likely an essential component of a workable strategy to mitigate climate change risk. Recent years have seen rapid growth in installed solar generating capacity, great improvements in technology, price, and performance, and the development of creative business models that have spurred investment in residential solar systems. Nonetheless, further advances are needed to enable a dramatic increase in the solar contribution at socially acceptable costs. Achieving this role for solar energy will ultimately require that solar technologies become cost-competitive with fossil generation, appropriately penalized for carbon dioxide (CO2) emissions, with — most likely — substantially reduced subsidies.

This study examines the current state of U.S. solar electricity generation, the several technological approaches that have been and could be followed to convert sunlight to electricity, and the market and policy environments the solar industry has faced. Our objective is to assess solar energy’s current and potential competitive position and to identify changes in U.S. government policies that could more efficiently and effectively support the industry’s robust, long-term growth.

We focus in particular on three preeminent challenges for solar generation: reducing the cost of installed solar capacity, ensuring the availability of technologies that can support expansion to very large scale at low cost, and easing the integration of solar generation into existing electric systems. Progress on these fronts will contribute to greenhouse-gas reduction efforts, not only in the United States but also in other nations with developed electric systems. It will also help bring light and power to the more than one billion people worldwide who now live without access to electricity.

The MIT EPPA6 Model: Economic Growth, Energy Use, and Food Consumption

The MIT Economic Projection and Policy Analysis (EPPA) model has been broadly applied on energy and climate policy analyses. In this paper, we provide an updated version of the model based on the most recent global economic database with the base year data of 2007. Also new in this version of the model are non-homothetic preferences, a revised capital vintaging structure, separate accounting of residences, and an improved model structure that smooths its functioning and makes future extensions easier. The study finds that, as the economies grow, the empirically observed income elasticities of demand are better represented by our setting than by a pure Stone-Geary approach, and simulation results are more sensitive to GDP growth than energy and non-energy substitution elasticities and autonomous energy efficiency improvement.

Revised October 2015.

The MIT EPPA6 Model: Economic Growth, Energy Use, Emissions, and Food Consumption

The MIT Emissions Prediction and Policy Analysis (EPPA) model has been broadly applied on energy and climate policy analyses. In this paper, we present our newest model: EPPA6-L. Besides adopting the GTAP8 database as the core economic data, EPPA6-L incorporates the latest energy, emissions, and cost estimates from existing studies, and enhances the model structure and implementation to facilitate future extension. With these improvements, the projected business-as-usual CO2 emissions in 2100 are lowered by 6.3% compared to the EPPA5 number. We also present how projections for the consumption of crops, livestock, and food products are improved with non-homothetic preference, and how various assumptions for business-as-usual GDP growth, elasticity of substitution between energy and non-energy input, and autonomous energy efficiency improvement may change CO2 emissions and prices.

Are Land-use Emissions Scalable with Increasing Corn Ethanol Mandates in the United States?

In response to the Renewable Fuel Standard, the U.S. transportation sector now consumes a substantial amount (13.3 billion gallons in 2010) of ethanol. A key motivation for these mandates is to expand the consumption of biofuels in road transportation to both reduce foreign oil dependency and to reduce greenhouse gas (GHG) emissions from the consumption of fossil fuels in transportation. In this paper, we present the impacts of several biofuels expansion scenarios for the U.S. in which scaled increases in the U.S. corn ethanol mandates are modeled to explore the scalability of GHG impacts. The impacts show both expected and surprising results. As expected, the area of land used to grow biofuel crops increases with the size of the policy in the U.S., and some land-use changes occur abroad due to trade in agricultural commodities. Because the land-use changes happen largely in the U.S., there is an increase in U.S. land-use emissions when natural lands are converted to agricultural use in the policy scenarios. Further, the emissions impacts in the U.S. and the rest of the world in these scenarios, including land-use emissions, scale in direct proportion to the size of the U.S. corn ethanol mandates. On the other hand, the land-use emissions that occur in the rest of the world are disproportionately larger per hectare of change due to conversions of more carbon-rich forests to cultivate crops and feed livestock.

Behavior of the aggregate wind resource in the ISO regions in the United States

The collective behavior of wind farms in seven Independent System Operator (ISO) areas has been studied. The generation duration curves for each ISO show that there is no aggregated power for some fraction of time. Aggregation of wind turbines mitigates intermittency to some extent, but in each ISO there is considerable fraction of time when there is less than 5% capacity. The hourly wind power time series show benefit of aggregation but the high and low wind events are lumped in time, thus indicating that intermittency is synchronized in each region. The timeseries show that there are instances when there is no wind power in most ISOs because of large-scale high pressure systems. An analytical consideration of the collective behavior of aggregated wind turbines shows that the benefit of aggregation saturates beyond a certain number of generating units asymptotically. Also, the benefit of aggregation falls rapidly with temporal correlation between the generating units.

Capturing Natural Resource Dynamics in Top-Down Energy"‘Economic Equilibrium Models

Top-down energy-economic modeling approaches often use deliberately simple techniques to represent heterogeneous resource inputs to production. We show that for some policies, such as feed-in tariffs (FIT) for renewable electricity, detailed representation of renewable resource grades is required to describe the technology more precisely and identify cost-effective policy designs. We extend a hybrid approach for modeling heterogeneity in the quality of natural resource inputs required for renewable energy production in a stylized computable general equilibrium (CGE) framework. Importantly, this approach resolves nearflat or near-vertical sections of the resource supply curve that translate into key features of the marginal cost of wind resource supply, allowing for more realistic policy simulation. In a second step, we represent the shape of a resource supply curve based on more detailed data. We show that for the case of onshore wind development in China, a differentiated FIT design that can only be modeled with the hybrid approach requires less than half of the subsidy budget needed for a uniform FIT design and proves to be more cost-effective.

Carbon taxes, deficits, and energy policy interactions

The United States faces the challenge of bringing its federal budget deficit under control, while also reducing its greenhouse gas emissions. Current energy policy has not been very effective in reducing greenhouse gas emissions, although that has not necessarily been its sole purpose. And rather than raise revenue, much energy policy involves subsidies through the tax system that reduce revenue or regulatory policy that may indirectly reduce revenue through its effects on economic activity. This paper focuses on the role of a carbon tax as one option to raise revenue while also reducing greenhouse gases. We also examine the interaction with other regulatory policies, namely renewable portfolio standards, which have been implemented in many states, and the corporate average fuel economy standards.

© 2015 National Tax Association

Contribution of biomass to emissions abatement under a global carbon policy

What will large-scale global bioenergy production look like? We investigate this question by developing a detailed representation of bioenergy production and use in a global economy-wide model. To create market conditions favorable to biomass energy, we develop a scenario with a global carbon dioxide price that starts at $55 per ton in 2015 and rises to $217 in 2050, which results in a global bioenergy production of ~140 exajoules (EJ) in 2050. By comparison, in 2010 global coal energy was 139 EJ, oil 175 EJ, and gas 108 EJ. In our simulations, there is a short-term role for first-generation biofuels, but lignocellulosic biofuels are the largest component of bioenergy by 2050. This results reflects our assumptions that there is the most potential for cost-reducing technical advance in this process, combined with the fact that land requirements to grow cellulosic feedstocks are lower than for conventional crops. Biomass also competes favorably to supply industrial process heat. Even at this large scale, we find that land requirements for bioenergy production do not result in significant land-use change issues. The availability of biomass residues, increasing interests in limiting deforestation, and improvements in crop yields and efficiency in converting biomass to energy combine to reduce pressure on land markets.

Cross-country electricity trade, renewable energy and European transmission infrastructure policy

This paper develops a multi-country multi-sector general equilibrium model, integrating high-frequency electricity dispatch and trade decisions, to study the effects of electricity transmission infrastructure (TI) expansion and renewable energy (RE) penetration in Europe for gains from trade and carbon dioxide emissions in the power sector. TI can benefit or degrade environmental outcomes, depending on RE penetration: it complements emissions abatement by mitigating dispatch problems associated with volatile and spatially dispersed RE but also promotes higher average generation from low-cost coal if RE production is too low. Against the backdrop of European decarbonization and planned TI expansion, we find that emissions increase for current and targeted year-2020 levels of RE production and decrease for year-2030 targets. Enhanced TI yields sizeable gains from trade that depend positively on RE penetration, without creating large adverse impacts on regional equity.

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