Liquid fuels - GCAM
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|Institution||Pacific Northwest National Laboratory, Joint Global Change Research Institute (PNNL, JGCRI), USA, http://www.globalchange.umd.edu.|
|Solution concept||General equilibrium (closed economy)GCAM solves all energy, water, and land markets simultaneously|
|Solution method||Recursive dynamic solution method|
|Anticipation||GCAM is a dynamic recursive model, meaning that decision-makers do not know the future when making a decision today. After it solves each period, the model then uses the resulting state of the world, including the consequences of decisions made in that period - such as resource depletion, capital stock retirements and installations, and changes to the landscape - and then moves to the next time step and performs the same exercise. For long-lived investments, decision-makers may account for future profit streams, but those estimates would be based on current prices. For some parts of the model, economic agents use prior experience to form expectations based on multi-period experiences.|
The refining sector, or liquid fuels production sector, explicitly tracks all energy inputs, emissions, and costs involved with converting primary energy forms into liquid fuels. Liquid fuels include gasoline, diesel, kerosene, ethanol and many other liquid hydrocarbon fuels; for the full mapping see Mapping the IEA Energy Balances. The refining sector includes subsectors of oil refining, biomass liquids, gas to liquids, and coal to liquids, each of which are described below. Each of these four subsectors is available starting in the first future time period, and the capital stocks of refineries are explicitly tracked. Click on the headings for links to the corresponding section in the documentation, and see the full refining section here.
The oil refining subsector accounts for the vast majority of the historical output of the refining sector, globally and in all regions. Each region is assigned a single production technology for oil refining; this technology does not differentiate between conventional and unconventional oil, whose competition is explicitly modeled upstream of the refining sector. In a typical region, the oil refining technology consumes three energy inputs: crude oil, natural gas, and electricity.
The coefficients of the oil refining production technology reflect whole-process inputs and liquid fuel outputs; there is no explicit tracking of the production and on-site use of intermediate products such as refinery gas (still gas). Electricity produced at refineries (both the fuel inputs and electricity outputs) is modeled in the electricity and/or industrial energy use sectors, as the IEA Energy Balances (IEA 2012) do not disaggregate autoproducer electric power plants at refineries from elsewhere. There is no oil refining technology option with CO2 capture and storage (CCS) considered.
The biomass liquids subsector includes up to eight technologies in each region, with a global total of 11. The technologies include up to four “first-generation” biofuels in each region, defined as biofuels produced agricultural crops that are also used as food, animal feed, or other modeled uses (described in the AgLU module). The model tracks secondary feed outputs of biofuel production, as DDGS (dried distillers grains and solubles) from ethanol production, and as feedcakes from biodiesel production. Second-generation technologies consume the “biomass” or “biomassOil” commodities, which include purpose-grown bioenergy crops, as well as residues from forestry and agriculture, and municipal and industrial wastes. Starting in 2020, second-generation biofuels (cellulosic ethanol and Fischer-Tropsch syn-fuels) are introduced, each with three levels of CCS: none, level 1, and level 2. The first CCS level generally consists of relatively pure and high-concentration CO2 sources (e.g., from gasifiers or fermenters), which have relatively low capture and compression costs. The second CCS level includes a broader set of sources (e.g., post-combustion emissions), and incurs higher costs but has a higher CO2 removal fraction.
The majority of the world’s coal to liquids production is in South Africa (IEA 2012), but the technology is available to all regions in GCAM starting in the first future time period. Note that the CO2 emissions intensity is substantially higher than all other liquid fuel production technologies, due to high process energy intensities, and high primary fuel carbon contents. Where crude oil refining emits about 5.5 kg of CO2 per GJ of fuels produced, coal to liquids emits over 130 kg of CO2 per GJ of fuel produced. The upstream emissions from fuel production by this pathway are substantially higher than the “tailpipe” emissions from combustion of the fuels produced (about 70 kg CO2 per GJ). As with biomass liquids, two different production technologies with CCS are represented, with costs and CO2 removal fractions based on Dooley and Dahowski (2009).
While a minor contributor to liquid fuels production globally (about 0.1%; IEA 2012), gas to liquids has received increased attention in recent years, with several large-scale plants completed in the last decade (Glebova 2013), and others in various stages of planning and construction (Enerdata 2014). Because of the relatively low carbon content of natural gas, and whole-process energy efficiency ratings typically about 60%, the net CO2 emissions from the process are about 20 kg CO2 per GJ of fuel, significantly lower than coal to liquids. There is only one production technology represented in GCAM, with no CCS option available.