Prospective Outlook on Long-term Energy Systems (POLES) is a world simulation model for the energy sector that runs on the Vensim software. It is a techno-economic model with endogenous projection of energy prices, a complete accounting of energy demand and supply of numerous energy vectors and associated technologies, and a carbon dioxide and other greenhouse gases emissions module.
POLES was initially developed in the early 1990s in the Institute of Energy Policy and Economics IEPE (now EDDEN-CNRS) in Grenoble, France. It was conceived on the basis of research issues related to global energy supply and climate change and the long-term impact of energy policies. It was initially developed through a detailed description of sectoral energy demand, electricity capacity planning and fossil fuel exploration and production in the different world regions. Along its development it incorporated theoretical and practical expertise in many fields such as mathematics, economics, engineering, energy analysis, international trade and technical change.
The initial development of POLES was financed by the JOULE II and III programmes of the European Commission’s Third and Fourth Framework Programmes (FP) for Research and Technological Development (1990-1994 and 1994-1998) as well as by the French CNRS. Since then, the model has been developed extensively through several projects, some partly financed by FP5, FP6 and FP7, and in collaboration between the EDDEN-CNRS, the consulting company Enerdata and the European Joint Research Centre IPTS.
With a history spanning twenty years, it is one of the few energy models worldwide that benefits from a continuous development process and expertise over such an extended time period.
The model provides a complete system for the simulation and economic analysis of the world’s energy sector up to 2050. POLES is a partial equilibrium model with a yearly recursive simulation process with a combination of price-induced behavioural equations and a cost- and performance-based system for a large number of energy or energy-related technologies. Contrary to several other energy sector models, international energy prices are endogenous. The main exogenous variables are the gross domestic product and population for each country or region. [1]
The model’s structure corresponds to a system of interconnected modules and articulates three levels of analysis: international energy markets, regional energy balances, and national energy demand (which includes new technologies, electricity production, primary energy production systems and sectoral greenhouse gas emissions).
POLES breaks down the world into 66 regions, of which 54 correspond to countries (including the 28 countries of the European Union) and 12 correspond to countries aggregates; for each of these regions, a full energy balance is modelled. The model covers 15 energy demand sectors in each region.
Each demand sector is described with a high degree of detail, including activity indicators, short- and long-term energy prices and associated elasticities and technological evolution trends (thus including the dynamic cumulative processes associated with technological learning curves). This allows a strong economic consistency in the adjustment of supply and demand by region, as relative price changes at a sectoral level impact all key component of a region’s sector. Sectoral value added is simulated.
Energy demand for each fuel in a sector follows a market share-based competition driven by energy prices and factors related to policy or development assumptions.
The model is composed of the following demand sectors:
There are 88 oil and gas production regions with inter-regional trade; these producing regions supply the international energy markets, which in turn feed the demand of the 66 aforementioned world regions. Fossil fuel supply modelisation includes a technological improvement in the oil recovery rate, a linkage between new discoveries and cumulative drilling and a feedback of the reserves/production ratio on the oil price. OPEC and non-OPEC production is differentiated. The model includes non-conventional oil resources such as oil shales and tar sands.
There are 30 electricity generation technologies, among which several technologies that are still marginal or planned, such as thermal production with carbon capture and storage or new nuclear designs. Price-induced diffusion tools such as feed-in tariffs can be included as drivers for projecting the future development of new energy technologies.
The model distinguishes four typical daily load curves in a year, with two-hour steps. The load curves are met by a generation mix given by a merit order that is based on marginal costs of operation, maintenance and annualized capital costs. Expected power demand over the year influences investment decisions for new capacity planning in the next step.
The model includes accounting of greenhouse gas (GHG) emissions and allows visualising GHG flows on sectoral, regional and global levels. POLES covers fuel combustion-related emissions in all demand sectors, thus covering over half of global GHG emissions. The six Kyoto Protocol GHGs are covered (carbon dioxide, methane, nitrous oxide, sulphur hexafluoride, hydrofluorocarbons and perfluorocarbons).
The model can be used to test the sensibility of the energy sector to the carbon price as applied to the price of fossil fuels on a regional level, as envisaged or experimented by cap and trade systems like the EU’s Emissions Trading Scheme.
The model’s databases have been developed by IPTS, EDDEN and Enerdata. Data on technological costs and performances were provided by the TECHPOL database. [2] [3] The data for historical energy demand, consumption and prices are compiled and provided by Enerdata. [4]
The POLES model can be used to study or test the effect of different energy resources assumptions or energy policies and assess the importance of various driving variables behind energy demand and the penetration rates of certain electricity generation or end-use technologies. POLES does not directly provide the macro-economic impact of mitigation solutions as envisaged by the Stern Review, however it allows a detailed assessment of the costs associated with the development of low- or zero-carbon technologies.
Linked with GHG emissions profiles, the model can produce marginal abatement cost curves (MACCs) for each region and sector at a desired time; these can be used to quantify the costs related to GHG emissions reduction or as an analysis tool for strategic areas for emissions control policies and emissions trading systems under different market configurations and trading rules. [5] [6]
Studies including POLES simulations have been commissioned by international bodies such as several Directorates-General of the European Commission, [7] [8] national energy, environment, industry and transport agencies [9] or private actors in the energy sector. [10] [11] [12]
POLES can model changes in sectoral value added and shifts of activity between sectors. However POLES is not a macroeconomic model in the sense that it uses the gross domestic product as an input and includes no feedback on it that could result from the evolution of the energy system: carbon pricing, falling oil production and its effect on transport and mobility, or growth induced by technological innovation (such as the IT boom of the 1990s). As such, it does not provide the total impact on society of, e.g., climate adaptation or mitigation (it does however quantify the total cost to the energy sector, including investment necessary in the development of low-carbon technologies).
The model does not cover all greenhouse gases emissions, notably those related to agriculture (in part), land use, land-use change and forestry. As such, the climate component of the model does not allow to fully project GHG stocks, concentrations and associated temperature rises from anthropogenic climate change. [13]
Energy policies are the government's strategies and decisions regarding the production, distribution, and consumption of energy within a specific jurisdiction. Energy is essential for the functioning of modern economies because they require energy for many sectors, such as industry, transport, agriculture, housing. The main components of energy policy include legislation, international treaties, energy subsidies and other public policy techniques.
An emission intensity is the emission rate of a given pollutant relative to the intensity of a specific activity, or an industrial production process; for example grams of carbon dioxide released per megajoule of energy produced, or the ratio of greenhouse gas emissions produced to gross domestic product (GDP). Emission intensities are used to derive estimates of air pollutant or greenhouse gas emissions based on the amount of fuel combusted, the number of animals in animal husbandry, on industrial production levels, distances traveled or similar activity data. Emission intensities may also be used to compare the environmental impact of different fuels or activities. In some case the related terms emission factor and carbon intensity are used interchangeably. The jargon used can be different, for different fields/industrial sectors; normally the term "carbon" excludes other pollutants, such as particulate emissions. One commonly used figure is carbon intensity per kilowatt-hour (CIPK), which is used to compare emissions from different sources of electrical power.
Climate change mitigation (or decarbonisation) is action to limit the greenhouse gases in the atmosphere that cause climate change. Climate change mitigation actions include conserving energy and replacing fossil fuels with clean energy sources. Secondary mitigation strategies include changes to land use and removing carbon dioxide (CO2) from the atmosphere. Current climate change mitigation policies are insufficient as they would still result in global warming of about 2.7 °C by 2100, significantly above the 2015 Paris Agreement's goal of limiting global warming to below 2 °C.
Clean technology, also called cleantech or climatetech, is any process, product, or service that reduces negative environmental impacts through significant energy efficiency improvements, the sustainable use of resources, or environmental protection activities. Clean technology includes a broad range of technology related to recycling, renewable energy, information technology, green transportation, electric motors, green chemistry, lighting, grey water, and more. Environmental finance is a method by which new clean technology projects can obtain financing through the generation of carbon credits. A project that is developed with concern for climate change mitigation is also known as a carbon project.
Energy in the United Kingdom came mostly from fossil fuels in 2021. Total energy consumption in the United Kingdom was 142.0 million tonnes of oil equivalent in 2019. In 2014, the UK had an energy consumption per capita of 2.78 tonnes of oil equivalent compared to a world average of 1.92 tonnes of oil equivalent. Demand for electricity in 2023 was 29.6 GW on average, supplied through 235 TWh of UK-based generation and 24 TWh of energy imports.
A low-carbon economy (LCE) is an economy which absorbs as much greenhouse gas as it emits. Greenhouse gas (GHG) emissions due to human activity are the dominant cause of observed climate change since the mid-20th century. There are many proven approaches for moving to a low-carbon economy, such as encouraging renewable energy transition, energy conservation, electrification of transportation, and carbon capture and storage. An example are zero-carbon cities.
The Investor Network on Climate Risk (INCR) is a nonprofit organization of investors and financial institutions that promotes better understanding of the financial risks and investment opportunities posed by climate change. INCR is coordinated by Ceres, a coalition of investors and environmental groups working to advance sustainable prosperity.
Energy planning has a number of different meanings, but the most common meaning of the term is the process of developing long-range policies to help guide the future of a local, national, regional or even the global energy system. Energy planning is often conducted within governmental organizations but may also be carried out by large energy companies such as electric utilities or oil and gas producers. These oil and gas producers release greenhouse gas emissions. Energy planning may be carried out with input from different stakeholders drawn from government agencies, local utilities, academia and other interest groups.
Greenhouse gas (GHG) emissions from human activities intensify the greenhouse effect. This contributes to climate change. Carbon dioxide, from burning fossil fuels such as coal, oil, and natural gas, is one of the most important factors in causing climate change. The largest emitters are China followed by the United States. The United States has higher emissions per capita. The main producers fueling the emissions globally are large oil and gas companies. Emissions from human activities have increased atmospheric carbon dioxide by about 50% over pre-industrial levels. The growing levels of emissions have varied, but have been consistent among all greenhouse gases. Emissions in the 2010s averaged 56 billion tons a year, higher than any decade before. Total cumulative emissions from 1870 to 2022 were 703 GtC, of which 484±20 GtC from fossil fuels and industry, and 219±60 GtC from land use change. Land-use change, such as deforestation, caused about 31% of cumulative emissions over 1870–2022, coal 32%, oil 24%, and gas 10%.
The United States produced 5.2 billion metric tons of carbon dioxide equivalent greenhouse gas (GHG) emissions in 2020, the second largest in the world after greenhouse gas emissions by China and among the countries with the highest greenhouse gas emissions per person. In 2019 China is estimated to have emitted 27% of world GHG, followed by the United States with 11%, then India with 6.6%. In total the United States has emitted a quarter of world GHG, more than any other country. Annual emissions are over 15 tons per person and, amongst the top eight emitters, is the highest country by greenhouse gas emissions per person.
Carbon leakage a concept to quantify an increase in greenhouse gas emissions in one country as a result of an emissions reduction by a second country with stricter climate change mitigation policies. Carbon leakage is one type of spill-over effect. Spill-over effects can be positive or negative; for example, emission reductions policy might lead to technological developments that aid reductions outside of the policy area. Carbon leakage is defined as "the increase in CO2 emissions outside the countries taking domestic mitigation action divided by the reduction in the emissions of these countries." It is expressed as a percentage, and can be greater or less than 100%. There is no consensus over the magnitude of long-term leakage effects.
Carbon emission trading (also called carbon market, emission trading scheme (ETS) or cap and trade) is a type of emissions trading scheme designed for carbon dioxide (CO2) and other greenhouse gases (GHGs). A form of carbon pricing, its purpose is to limit climate change by creating a market with limited allowances for emissions. Carbon emissions trading is a common method that countries use to attempt to meet their pledges under the Paris Agreement, with schemes operational in China, the European Union, and other countries.
Abatement cost is the cost of reducing environmental negatives such as pollution. Marginal cost is an economic concept that measures the cost of an additional unit. The marginal abatement cost, in general, measures the cost of reducing one more unit of pollution. Marginal abatement costs are also called the "marginal cost" of reducing such environmental negatives.
The economics of climate change mitigation is a contentious part of climate change mitigation – action aimed to limit the dangerous socio-economic and environmental consequences of climate change.
In 2021, net greenhouse gas (GHG) emissions in the United Kingdom (UK) were 427 million tonnes (Mt) carbon dioxide equivalent, 80% of which was carbon dioxide itself. Emissions increased by 5% in 2021 with the easing of COVID-19 restrictions, primarily due to the extra road transport. The UK has over time emitted about 3% of the world total human caused CO2, with a current rate under 1%, although the population is less than 1%.
Green economy policies in Canada are policies that contribute to transitioning the Canadian economy to a more environmentally sustainable one. The green economy can be defined as an economy, "that results in improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities." Aspects of a green economy would include stable growth in income and employment that is driven by private and public investment into policies and actions that reduce carbon emissions, pollution and prevent the loss of biodiversity.
Coal, cars and lorries vent more than a third of Turkey's six hundred million tonnes of annual greenhouse gas emissions, which are mostly carbon dioxide and part of the cause of climate change in Turkey. The nation's coal-fired power stations emit the most carbon dioxide, and other significant sources are road vehicles running on petrol or diesel. After coal and oil the third most polluting fuel is fossil gas; which is burnt in Turkey's gas-fired power stations, homes and workplaces. Much methane is belched by livestock; cows alone produce half of the greenhouse gas from agriculture in Turkey.
China's greenhouse gas emissions are the largest of any country in the world both in production and consumption terms, and stem mainly from coal burning, including coal power, coal mining, and blast furnaces producing iron and steel. When measuring production-based emissions, China emitted over 14 gigatonnes (Gt) CO2eq of greenhouse gases in 2019, 27% of the world total. When measuring in consumption-based terms, which adds emissions associated with imported goods and extracts those associated with exported goods, China accounts for 13 gigatonnes (Gt) or 25% of global emissions. According to the Carbon Majors Database, Chinese state coal production alone accounts for 14% of historic global emissions.
Greenhouse gas emissionsbyRussia are mostly from fossil gas, oil and coal. Russia emits 2 or 3 billion tonnes CO2eq of greenhouse gases each year; about 4% of world emissions. Annual carbon dioxide emissions alone are about 12 tons per person, more than double the world average. Cutting greenhouse gas emissions, and therefore air pollution in Russia, would have health benefits greater than the cost. The country is the world's biggest methane emitter, and 4 billion dollars worth of methane was estimated to leak in 2019/20.
World energy supply and consumption refers to the global supply of energy resources and its consumption. The system of global energy supply consists of the energy development, refinement, and trade of energy. Energy supplies may exist in various forms such as raw resources or more processed and refined forms of energy. The raw energy resources include for example coal, unprocessed oil & gas, uranium. In comparison, the refined forms of energy include for example refined oil that becomes fuel and electricity. Energy resources may be used in various different ways, depending on the specific resource, and intended end use. Energy production and consumption play a significant role in the global economy. It is needed in industry and global transportation. The total energy supply chain, from production to final consumption, involves many activities that cause a loss of useful energy.