Energy demand

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TIMER model, energy demand module
Some sectors are represented in a generic way as shown here, the sectors transport, residential and heavy industry are modelled in specific modules.

Key policy issues

  • How will energy demand evolve particularly in emerging and medium- and low-income economies?
  • What is the mix of end-use energy carriers to meet future energy demand?
  • How can energy efficiency contribute to reducing the growth rate of energy demand and mitigate pressures on the global environment?


Global energy use has increased rapidly since the industrial revolution. For a historical perspective, most increases have occurred in high-income regions but more recently, the largest increase is in emerging economies. With the aspirations for income growth in medium- and low-income countries, energy demand is to be expected to grow in the coming decades, with major implications for sustainability.

Energy demand sectors and processes

In the TIMER energy demand module, final energy demand is simulated as a function of changes in population, economic activity and energy intensity (see flowchart). Five economic sectors are considered: industry; transport; residential; public and private services; and other sectors mainly agriculture. In each sector, final energy use is driven by the demand for energy services, such as motor drive, mass displacement, chemical conversions, lighting, heating and cooling. Energy demand is considered as a function of three groups of parameters and processes:

  • activity data, for example on population and income, and more explicit activity indicators, such as steel production;
  • long-term trends that determine the intensity of use, for example, economic structural change (SC), autonomous energy efficiency improvement (AEEI) and price-induced energy efficiency improvement (PIEEI);
  • price-based fuel substitution ( the choice of energy carrier on the basis of its relative costs).

These factors are implemented in different ways in the various sectors. In some sectors, a detailed end-use service-oriented modelling approach is used while in other sectors, the description is more generic and aggregate. Energy prices link the demand module with other parts of the energy model, as they respond dynamically to changes in demand, supply and conversion.

Input/Output Table

Input Energy demand component

IMAGE model drivers and variablesDescriptionSource
Energy efficiency technology Model assumptions determining future development of energy efficiency. Drivers
Energy intensity parameters Set of parameters determining the energy use per unit of economic activity (in absence of technical energy efficiency improvements). Drivers
GDP per capita Gross Domestic Product per capita, measured as the market value of all goods and services produced in a region in a year, and is used in the IMAGE framework as a generic indicator of economic activity. Drivers
Lifestyle parameters Lifestyle parameters influence the relationship between economic activities and demand for energy. Drivers
Population Number of people per region. Drivers
Preferences Non-price factors determining market shares, such as preferences, environmental policies, infrastructure and strategic considerations, used for model calibration. Drivers
Private consumption Private consumption reflects expenditure on private household consumption. It is used in IMAGE as a driver of energy. Drivers
Sector value added Value Added for economic sectors: Industry (IVA), Services (SVA) and Agriculture (AVA). These variables are used in IMAGE to indicate economic activity. Drivers
Taxes and other additional costs Taxes on energy use, and other additional costs Drivers
Electricity price The price of electricity. Energy conversion
Primary energy price The price of primary energy carriers based on production costs. Energy supply
Secondary energy price The secondary energy price of each energy carrier at the end-use level (coal, oil, gas, bio-energy, electricity, hydrogen) is calculated based on (1) the primary energy price, (2) energy taxes and subsidies, (3) the costs of energy conversion throughout the energy supply chain and (4) a correction factor. Energy conversion
External datasetsDescriptionSource
Exogenously set market shares Market shares of traditional biomass and secondary heat, for all demand sectors except the residential sector, exogenous scenario parameter. IEA

Output Energy demand component

IMAGE model variablesDescriptionUse
Demand for electricity, heat and hydrogen The demand for production of electricity, heat and hydrogen.
Demand traditional biomass Regional demand for traditional bioenergy.
People dependent on solid fuel Proportion of population using traditional biomass and coal for cooking and heating.
Energy and industry activity level Activity levels in the energy and industrial sector, per process and energy carrier, for example, the combustion of petrol for transport or the production of crude oil.
Demand for fossil fuels and bioenergy The demand for the production of fossil fuels and bioenergy. Final output