The Model

The Model Graph

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Our integrated model simulates economy-wide impacts of policy interventions like emission reduction goals (e.g. pledges to the COP21) and renewable energy and/or energy efficiency targets. These simulations reveal unique insight to how domestic energy markets will be reshaped, what kind of investment opportunities and payback horizons will exist, and the impact on jobs in both the renewable energy and energy efficiency sectors.

Most of the modeling developed thus far around emissions reductions and carbon abatement are defined by projecting the cost associated with reaching certain economy-wide or sector-based reductions in emissions. Our model takes a more integrated view of these interventions, in order to gain greater understanding of the likely outcomes resulting from their implementation. A more traditional approach to this analysis would use cost curves to show the cost of technology associated with target emissions reductions. Our modeling forecasts economy-wide outcomes over time with direct links to the stakeholders most impacted by them – policy makers, investors and businesses – so they can utilize a more multi-dimensional set of results to inform their decision making.

In the most simple terms, our model takes inputs from each country – including policy interventions and certain assumptions like population trends, GDP growth and energy prices – and generates outputs related to investment required, policy-induced avoided costs and added benefits in areas like employment and performance against secondary targets related to energy consumption and emissions. Looking at a Business as Usual (BAU) scenario and a Low Carbon (LC) one, what is the total projected country energy demand, and from which sources will it be obtained? How do changes in GDP growth, population and energy efficiency in a given economy impact projected energy demand and emissions levels? How do reductions in post-2020 emission levels translate to sector-impacts over time? For example, how will the United States’ INDC influence the US energy mix and contribution of renewables to electricity generation over time? How do reductions in post-2020 emission levels translate to investment opportunity? Calculation of the “green jobs” resulting from country pledges and the skills needed to fill them, with insights on challenges and opportunities for talent attraction and worker training.