Parts of Energy demand
|Component is implemented in:|
|Related IMAGE components|
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 final energy use has increased rapidly since the industrial revolution. Although, for a historical perspective, most increases have occurred in currently high-income regions, more recently the largest increase occurred in emerging economies. Given the aspirations for income growth in medium- and low-income countries, a continued high rate of growth in energy demand is to be expected in the coming decades, with important implications for sustainability.
Energy demand sectors and processes
In the energy demand model, final energy demand is simulated as a function of changes in population, economic activity and energy intensity (see the flowchart on the left). The model considers five basic sectors:
- services (both public and private;
- other (mostly agriculture).
Within each of these sectors, final energy use is driven by the demand for energy services, such as motor drive, mass displacement, chemical conversions, lighting, heating and cooling. Here, the demand for energy is considered a function of three groups of parameters and processes:
- activity data (e.g. on population and income, and more explicit, activity indicators such as steel production);
- long-term trends that determine the intensity of use (e.g. economic structural change (SC), autonomous energy efficiency improvement (AEEI) and price-induced energy efficiency improvement (PIEEI));
- price-based fuel substitution (i.e. the choice of energy carrier on the basis of its relative costs).
The ways in which these factors are implemented varies across the different sectors. For some sectors, a detailed end-use service-oriented modelling approach was implemented. For other sectors, the description is more generic and aggregate. It should be noted that energy prices link the demand modules with other parts of the energy model, as they respond dynamically to changes in demand, supply and conversion.
Input Energy demand component
|IMAGE model drivers and variables||Description||Source|
|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|
|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 variables||Description||Use|
|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|