1. Energy-Environment Modeling Meeting of the Illinois Climate Change Advisory Group 300 West Adams St., 2nd Floor, Chicago, IL February 22, 2007 Governor Rod R. Blagojevich Climate Change Advisory Group

2. 2 Why model? Examine different policy scenarios, including sensitivities Examine the cost of policy packages Assess interplay between policy options

3. Governor Rod R. Blagojevich Climate Change Advisory Group3 What gets modeled? New Policies Transport - VMT - mode switching Power - dispatch - electricity prices - new builds Industry Commercial Residential Agriculture - production - efficiency Energy Prices Energy Demand GSP Employment Emissions - reductions - cost of reductions

4. Governor Rod R. Blagojevich Climate Change Advisory Group4 Some modeling already done Illinois GHG Emission Trends with Energy Plan Reductions 1990-2020 Energy Plan emissions reductions from BAU Need to model policies that can reduce these emissions

5. Governor Rod R. Blagojevich Climate Change Advisory Group5 Examples of models: Multi-sector -Energy 2020 -Markal -National Energy Modeling System (NEMS) Power sector only -IPM -Haiku (Resources for the Future) -Regional dispatch models Transport sector only -UC Davis Economic Impacts -REMI -state-level input-output models

6. Governor Rod R. Blagojevich Climate Change Advisory Group6 Key model attributes to consider: Analytic capabilities -Energy prices, demand, efficiency -Policy design variables -Multi-regional interactions -Inter-sectoral dynamics -Emissions benefits -Economic Time horizon and solution intervals Operation -Licensing -Customization tasks -Lead time to develop -Running the model -Cost -Sensitivity analyses

7. Governor Rod R. Blagojevich Climate Change Advisory Group7 Next steps and discussion: Input from IL CCAGDefine key policies and their attributes Assumptions for reference case (e.g., fuel prices) Identify a modelerInterview modelers and assess capabilities, turnaround time, fees Contract modeling work Process and timingBring initial results to May meeting Determine need for revisions or testing of sensitivities