Considerations in using NEMS (and other input…) Alison Bailie Associate Scientist December 2003

National analyses of policies and measures with the aim to reduce U.S. greenhouse gas emissions, fossil fuel dependence and pollutant emissions (using NEMS). America's Energy Choices (1991) -- with ACEEE, UCS, ASE, NRDC Energy Innovations (1996) -- with ACEEE, UCS, ASE, NRDC Policies and Measures to Reduce CO2 Emissions in the US (WWF 1997; 1998) America's Global Warming Solutions (WWF 1999) Meeting America's Kyoto Protocol Targets (1999) -- with ACEEE Smart Energy Policies (2001) -- with ACEEE Clean Energy Blueprint (2001) – with UCS American Way to the Kyoto Protocol – with WWF Tellus’ Experience

Other National Analysis Aligning Clean Air and Clean Energy Goals – NREL 2003 State – based Analyses Rhode Island Greenhouse Gas Action Plan Puget Sound Clean Air Agency – Climate Protection Maine Greenhouse Gas Action Plan Working with MARKAL Emission factors as input to EPA National MARKAL model Tellus’ Experience

Benefits and Challenges of Using NEMS – residential, commercial, industrial – transportation – electricity General modeling challenges – data – full spectrum of choices – defining costs Presentation Outline

Benefits covers all sectors and includes feedback among sectors updated annually by EIA, data, source code and documentation available the reference case in the Annual Energy Outlook is reviewed and referenced by many includes technology detail and other benefits of bottom-up modeling with some behavioral constraints many policy options (tax credits, behavioral response, regulation) Challenges complex, multi-layered model consisting of many sub- modules developed with different goals documentation not always complete lack of state level data NEMS – general

Residential and commercial sectors have good range of technology choices but difficult to release constraints to allow NEMS to choose most efficient options difficult to add new technology choices Industrial sector does not have actual technology choices (except for boilers and CHP) NEMS – residential, commercial and industrial

wide range of vehicle choices (including fleet distinction) and represents major transportation modes includes range of behavioral responses (changing number of cars, amount driven, fuel choices) detailed technology descriptions for equipment add-ons (material substitution, engine friction reduction, camless valve actuation) limited ability to get model to switch between vehicle classes (eg. switch to smaller cars when faced with higher CAFÉ standards) NEMS - transportation

includes capacity expansion and dispatch modules includes environmental and reliability constraints, some parameters to reflect regions with market competition limited transmission and distribution modeling Tellus has modified input parameters to reflect set of alternative modeling assumptions for this sector based on NREL, UCS and others lots of embedded constraints limit the ability to analyze scenarios that differ significantly from the AEO reference case NEMS - electricity

Data – reliable, appropriate, documented full spectrum of choices – including behavioral changes (efficiency, smaller cars, changes based on non-financial incentives) how to define costs – social perspective – private perspective – what is the “cost” of accepting a smaller car or taking public transport? General modeling challenges