Industrial sector - POLES

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Model Documentation - POLES
Corresponding documentation
Model information
Institution JRC - Joint Research Centre - European Commission (EC-JRC), Belgium, http://ec.europa.eu/jrc/en/poles.
main users: - European Commission, JRC

- Universite de Grenoble UPMF, France - Enerdata

Solution concept
Solution method
Anticipation Myopic

The industry is represented in POLES through different sectors and processes.

The general modeling describes energy needs per sector / process dependent on an activity variable and energy prices. Total demand of energy depends on the activity variable and energy prices.

The activity variable is sectoral value added, or for the steel industry physical production of tons of steel. The latter depend on national demand and a global market, on which countries compete based on existing production capacities, the dynamics of the local market and the energy cost. The role of electrical steel increases with the amount of steel being recycled, blast furnace being the difference between total production needs and the contribution of electrical arc furnaces.

Competition across fuels / boilers (multinomial logit) takes place between oil, gas, coal, biomass and purchased steam based on costs for the user, considering the lifetime of existing equipment. The competition calibrated on historical data on prices and market shares.

Electricity needs, that also depend on the activity variable and electricity prices, can affect the need for other fuels through increased efficiency of the industrial processes.

The different industral sectors and processes are shown in the figure below.

Table 1: The industrial sectors in POLES
Sector Process Activity variable Fuel, energy use Fuel, non-energy use
Steel Blast furnace tons Electricity, oil, gas, coal, biomass coke
Electrical tons Electricity
Non-metallic minerals value added Electricity, oil, gas, coal, biomass, hydrogen, steam
Chemistry value added Electricity, oil, gas, coal, biomass, hydrogen, steam oil, gas, coal, biomass
Other industry value added Electricity, oil, gas, coal, biomass, hydrogen, steam

Note that the steel industry equations describe physical production, which depends on national demand and a global market, on which countries compete based on existing production capacities, the dynamics of the local market and the energy cost. The role of electrical steel increases with the amount of steel being recycled, blast furnace being the difference between total production needs and the contribution of electrical arc furnaces.