Production system and representation of economic sectors - 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.
Solution concept Partial equilibrium (price elastic demand)
Solution method SimulationRecursive simulation
Anticipation Myopic


Sectoral disaggregation

All economic activity variables are endogenously derived from GDP per capita and energy prices. The energy demand in POLES is endogenously derived from sector-specific drivers: economic activity, end-user energy prices and policies, including time lagged effects. The modeling also considers vintage and fuel / technology substitution constraints.

The model differentiates the following sectors:

  • Agriculture (economic activity: value added)
  • Industry (value added and physical production), with 4 sub-sectors:
    • Steel, Chemistry, Non-metallic minerals and Other industry; energy uses and non-energy uses of fuels are differentiated.
  • Services (value added): substitutable energy and captive electricity needs are differentiated
  • Residential (surface, occupation rate): needs for space heating, water heating, space cooling, cooking, appliances and lighting are differentiated
  • Transport (mobility), with 4 sub-sectors:
    • Road, Rail, Water, Air; additionally, international maritime bunkers and international air bunkers are differentiated.
    • The model differentiates passengers and goods transport, and various transport types: car, motorbikes, light duty vehicle, heavy duty vehicles.
    • Road vehicles are differentiated by engine (ICE, electric, hybrids, fuel cell) and fuel (oil products, biofuels, electricity, hydrogen, gas).
  • In addition, own-energy uses and losses in transformation (power, synthetic fuels, ..) are explicitly considered.

Historical data on energy demand, activity variables and fuel prices are updated at least once a year from various sources. Energy demand and prices come mostly from: Eurostat, IEA, Enerdata. Energy demand data can be available up to year-1.


Behavioural change

Behavioral changes is captured in 2 ways in POLES:

  • a change of the economic activity (applies to Residential and Transport): this change depends on income and energy prices through appropriate elasiticies;
  • a change in the rate of use of energy consuming equipment: this change depend on energy prices through short-term elasticities.