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Revision as of 11:53, 17 August 2016

Model Documentation - POLES

Corresponding documentation
Previous versions
Model information
Model link
Institution JRC - Joint Research Centre - European Commission (EC-JRC), Belgium, http://ec.europa.eu/jrc/en/.
Solution concept Partial equilibrium (price elastic demand)
Solution method SimulationRecursive simulation
Anticipation Myopic

The industry is represented in POLES through different sectors and processes, as shown in Figure 1 below.

The general modeling describes energy needs per sector / process dependent on an activity variable and energy prices. 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 equipments. 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.

Total demand of energy depends on the activity variable and energy prices.

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.

36405556.png Figure 1. The industrial sectors in POLES

Information sources include: Enerdata, Eurostat, IEA, IISI, World Bank.