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EC Projections Workshop Energy Paper 68 – baseline energy and CO2 projections, 2000 – 2020, published by DTI, November 2000. No plans to revise projections yet. UK Climate Change Programme – projections of all GHGs, including policies and measures, published by DEFRA, November 2000. No plans to revise yet. DTI is the department of trade and industry DEFRA is the department of environment, food and rural affairs) Projections and Policy: Departmental Responsibilities Area Key Departments Energy policy DTI Energy projections DTI CO2 Emission projections DTI/DEFRA Other GHG projections DEFRA Climate Change Policy DEFRA Model Design Two main components of the model: sectoral econometric models of final energy demand a LP model of electricity supply Model Design Electricity supply model: key features a linear programme covers existing major power producer power stations plus renewable plants based on pre-determined fuel costs, plant costs etc determines the overall least cost means of supply models main coal plants individually determines the merit order - the cheapest plants forecasts what new plant type is most economic model constrained to meet SOx/NOx emissions limits Other Models and Procedures A simulation CHP model A refinery model An Excel based workbook to calculate emissions on a UK source, end user and fuel basis and on a detailed and summary IPCC basis (with 3000 lines of visual basic programming) DTI UK Energy Model Overview OEF HMT OG ENP other assumptions GDP, activity assumptions world fuel prices UK fuel prices ENP other wisdom final energy demand model electricity demand electricity supply optimisation model electricity prices other emissions cost of electricity generation energy related emissions emissions inventory model fuel demand by sector matrix of emission coefficients total emissions, IPCC basis Final Energy Demand Sector Drivers DOMESTIC TRANSPORT SERVICE INDUSTRY Real personal disposable income (RPDI) Domestic Energy Prices GDP OECD GDP GDP GDP Petrol prices DERV prices Aviation fuel prices Population & Number of UK households Service Sector Industrial Sector Energy Prices Prices Fossil Fuel prices Electricity prices Service Sector Industrial Sector Output Output Assumptions External temperatures Number of UK households External temperatures (HDD) Major Vehicle Appliance take- registrations up Car ownership levels Track length, Goods lifted Major appliances, Air conditioning, Computer etc equipment Key Energy Modelling Assumptions Used in EP68 1. Incomes and economic growth 2. Energy Prices 3. Household numbers Key Energy Modelling Assumptions Used in EP68 -3 economic growth cases (low, central and high) -2 energy price cases (low and high) Many tests of sensitivity (including nuclear lifetimes, energy prices, temperature…) 199 8 199 9 200 0 200 1 200 2 200 3 200 4 200 5 200 6 200 7 200 8 200 9 201 0 201 1 201 2 201 3 201 4 201 5 201 6 201 7 201 8 201 9 202 0 %growth UK GDP Growth Assumptions 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0 central low high Beach (landed) Gas Price - EP68 ARA Coal Price -- EP68 Brent Oil Price EP68Prices Assumptions and Actual Assumptions Assumptionsand andActual ActualPrices Prices 60.00 30.00 25.00 50.00 25.00 20.00 15.00 30.00 15.00 10.00 20.00 10.00 5.00 gas actual 2001 2002 2002 2003 2003 2003 2004 2004 2005 2005 2005 2006 2006 2007 2007 2007 2008 2008 2009 2009 2009 2010 2010 2011 2011 2011 2012 2012 2013 2013 2013 2014 2014 2015 2015 2015 2016 2016 2017 2017 2017 2018 2018 2019 2019 2019 2020 2020 1999 2000 2000 2001 2001 1997 1997 1997 1998 1998 1999 1999 0.00 0.00 0.00 1995 1996 1996 10.00 5.00 1995 1995 $/tonne $/barrel pence/therm 40.00 20.00 coal EP68gas low EP68high highspot gas prices gas EP68 lowcoal oilactual actual oil EP68 low EP68coal oilhigh EP68 Key Assumptions on Population: Projection of total households in England, 1996 - 2021 POLICIES AND MEASURES Policies in the baseline (EP68) for 2010: Policy 10% renewables in generation CO2 Saving (MtC) 2.5 Climate change levy Road fuel duty 2.0 1 – 2.5 POLICIES AND MEASURES Policies in the Climate Change Programme for 2010: Policy CO2 Saving (MtC) Climate change agreements/IPCC 2.5 EU agreement on CO2 from cars… 4.0 Domestic energy efficiency 4.0-5.5 Emissions trading scheme (1st stage) 2.0 + Other Around 5.0 UK greenhouse gas emissions 1990-2020 (without/ with Climate Change Programme) 220 220 200 200 EP68 GGEs GGEs after CCP EP68 GGEs Kyoto target GGEs after CCP CO2 Kyoto target CO2 after CCP CO2 goal MtC MtC 180 180 160 160 140 140 120 120 100 100 1990 1990 2000 2000 2010 2010 2020 2020 Change in Baseline Emission Projections (2000 View against 1995 View) Total power stations industry other road transport services residential refineries -20 -15 -10 -5 0 5 Main Reasons for Change in Baseline Emission Projections Area Reasons Power stations 10% renewables generation lower electricity demand industry Climate change levy more CHP Road transport Effects of road fuel duties other Lower offshore emissions Openness Energy Modelling - EP68 1)..Energy industries are consulted 2)..A working paper was issued for comment 3)..Modellers available for informal discussion 4)..Energy Model Review - openness is a key issue Climate Change Programme 1)..Consultation Paper published for comment 2)..Dialogue with companies, other bodies Government Energy Review 1)..Encourages more openness 2)..Recommends a new sustainable energy unit, with more analytical capability, across Govt Model Parameters Energy Modelling - EP68 1)..Model elasticities last published in EP65 in March 1995 2)..Occasional papers submitted to conferences 3)..Elasticities reported in annual Energy Reports 4)..Modellers available for informal discussion of model parameters 5)..Energy Model Review will assess how best to provide information