# Presentation: 403534

## An EPA Overview: Energy Technology Assessment and Regional MARKAL Modeling Initiatives

- Timothy Johnson
- National Risk Management Research LaboratoryOffice of Research and Development
- U.S. EPA
- 13 May 2004

## Outline

- EPA’s ORD Energy Technology Assessment
- Introduction to MARKAL: What and Why?
- Regional New England MARKAL Model

## EPA's ORD Energy Technology Assessment

## EPA-ORD Energy Technology Scenario Analysis: Motivation

- Origins in EPA’s *Global Change Research Program*
- How might global climate change affect regional weather and (in turn) atmospheric pollution?
- Drivers of atmospheric pollution:
- Chemical reaction and transport
- Biogenic emissions
- Anthropogenic emissions
- Technological change is fundamental to the latter

## Specific EPA ORD Modeling Goals

- Develop and assess scenarios of energy technology evolution in emissions-intensive sectors of the US economy (transportation and electricity) and calculate associated emissions trajectories
- Provide multidimensional technology assessments
- Provide input to studies of environmental stressors
- Develop and make available a transparent, well-documented national MARKAL database

## Scenario Assessment Approach

- Scenario analysis *NOT* prediction
- Focus on 2000 – 2050 timeframe (currently up to 2030)
- Take into account driving forces:
- Technological change
- Energy supply and price dynamics
- Environmental, energy, and land use policies

## Scenario Assessment Approach

- Cover the range of possible futures and respond to other technology assessments
- Gather data from the major stakeholders in energy technology futures
- Industry
- Academic researchers and the National Academies
- NGOs
- Federal and state government agencies

## Introduction to MARKAL: What and Why?

## MARKAL

- Is a “bottom-up” energy-technology-environmental systems model
- Finds a least cost set of technologies to satisfy end-use energy service demands and user-specified constraints
- Calculates resulting environmental emissions

## Key MARKAL Features

- Provides a coherent and transparent framework
- Data assumptions are open and each result may be traced to its technological roots
- Is flexible (facilitates “What-If?” questions)
- Has a Long history (> 20 years) of widespread use (> 50 countries)
- Is PC-based, “relatively” easy to use

## What Does MARKAL Do?

- Identifies the least-cost pattern of resource use and technology deployment over time
- Quantifies the sources of emissions from the associated energy system
- Quantifies the system-wide effects of changes in resource supply, technology availability, and energy and environmental policies
- Provides a framework for exploring and evaluating alternative futures, and the role of various technology and policy options

## What Questions Can MARKAL Answer?

- What happens if a new technology becomes available, or if an old one becomes cheaper or more efficient?
- What are the implications of a technology forcing policy (e.g., a renewable portfolio standard)?
- How do changes in technology, environmental policy, and resource availability/costs interact?

## How MARKAL Works

- Objective: Minimize aggregate system costs ( = capital + operating + fuel + those associated with environmental emissions)
- Subject to various constraints:
- System: energy balance, demands, electrical system operation
- User-imposed: emissions caps, technology portfolio standards, taxes, and subsidies

## How MARKAL Works

- Represents all energy producing, transforming, and consuming processes as an interconnected network (Reference Energy System)
- Selects technologies to meet end-use service demands based on life-cycle costs of competing alternatives
- Enforces a systems perspective

## MARKAL's Four Stage Representation of an Energy System

_**Industry, **_**e.g.**
**-Process steam**
**-Motive power**
_**Services, **_**e.g.**
**-Cooling**
**-Lighting**
_**Households, **_**e.g.**
**-Space heat**
**-Refrigeration**
_**Agriculture, **_**e.g.**
**-Water supply**
_**Transport, **_**e.g.**
**-Person-km**

**Demand for **
**Energy Service**

_**Industry, **_**e.g.**
**-Steam boilers**
**-Machinery**
_**Services, **_**e.g.**
**-Air conditioners**
**-Light bulbs**
_**Households, **_**e.g.**
**-Space heaters**
**-Refrigerators**
_**Agriculture, **_**e.g.**
**-Irrigation pumps**
_**Transport, **_**e.g.**
**-Gasoline Car**
**-Fuel Cell Bus**

**End-Use**
**Technologies**

**Process**
**Technologies**

**Primary Energy **
**Supply**

_**Fuel processing**__ _
_**Plants**_** e.g.**
**-Oil refineries**
**-Hydrogen prod.**
**-Ethanol prod.**
_**Power plants**_** e.g.**
**-Conventional**
**  ****Fossil Fueled **
**-Solar**
**-Wind**
**-Nuclear**
**-CCGT**
**-Fuel Cells**
**-Combined Heat**
**    ****and Power**

_**Renewables**_** e.g. **
**-Biomass**
**-Hydro**
_**Mining**_** e.g.**
**-Crude oil**
**-Natural gas**
**-Coal**
_**Imports**_** e.g.**
**-crude oil **
**-oil products**
_**Exports**_** e.g.**
**-oil products**
**-coal**
_**Stock changes**_

**    ****(Final Energy)                         (Useful Energy)****    **

## Example MARKAL Reference Energy System with One End-Use Demand

- Each box     is a MARKAL technology
- Each arrow is a MARKAL energy carrier

- box

## MARKAL Data Requirements

- Useful energy end-use service demands
- Available resource supplies and costs
- Technology characteristics
- Existing capacity
- Costs: investment, fixed, variable, fuel
- Performance: fuels in/out, efficiency, emission rates, availability, lifetime
- Emissions constraints, taxes

## EPA National MARKAL database

| Sector | Sources | Technologies |
| --- | --- | --- |
| Transportation | DOE OTT | 15 personal vehicle technologies in 5 size classes; 40 other passenger and freight technologies |
| Electricity | NEMS, IPM | 45 technologies |
| Commercial | NEMS | 300 heating, cooling, ventilation, lighting, and refrigeration technologies |
| Residential | NEMS | 135 heating, cooling, lighting, and refrigeration technologies |
| Industrial | SAGE | Framework covering 6 industries, 6 energy services |
| Coal supply | NEMS | 25 types by region, sulfur content, and mine type; 8-step supply curves |
| Oil/gas supply | NEMS, USGS | 5 grades imported oil; 9 imported refined products plus natural gas; 3-step supply curves.
Domestic oil and gas production under development |
| Emissions | EPA, GREET | CO2, CH4, N20; criteria pollutants
Vehicle-specific emissions for transport
Control technology options for electricity
Sector fuel averages for RCI |

## Current Technology Focus

- Electricity generation:
- Advanced coal and natural gas plants
- Renewables
- Advanced nuclear plants
- Carbon capture and sequestration
- Transportation:
- Conventional and advanced gasoline and diesel ICEs
- Gasoline and diesel hybrids
- Hydrogen (and other) fuel cells
- Hydrogen

## Electric Sector Technology Assessment – Scenario Strategy

- “Forward” – Given expected technology cost/performance specifications, fuel price trajectories, etc., how are particular generation technologies employed to meet electricity demand?  How does this profile affect emissions?
- “Backward” – Given a fixed market penetration (e.g., for renewable generation by 2030), what routes get us there (e.g., high gas prices, specific technology assumptions for wind turbines)?

## Electric Sector Technology Assessment – Internal Focus

- Advanced technologies to examine include:
- Carbon capture (pre- and post-combustion)
- H2 fuel cells
- Distributed generation (microturbines)
- Advanced renewables (wind and solar)
- Biomass
- Advanced nuclear
- Technology-based issues:
- Nuclear – What might drive an expanded role?  Compatibility with an H2 economy?
- Renewables – How much capacity is feasible?
- Coal – What conditions favor an increase in use (e.g., adoption of carbon capture, gas prices)?

## Electric Sector Technology Assessment – Looking Across Sectors

- Natural gas – What are the impacts of a sustained increase in gas prices (due to demand change and/or resource depletion)?
- Demand increase – What happens to the generation and emissions profiles if electricity consumption greatly exceeds projections?
- Demand decrease – What demand-side efficiency measures have a significant impact?
- H2 Economy – How would the electricity sector contribute to and be affected by such a transition?

## Transportation Scenario Focus

- Impact and potential of biofuels
- System-wide environmental trade-offs between gasoline-hybrid and hydrogen fuel-cell vehicles
- Potential of fleet mandates
- Environmental and economic trade-offs between steam methane reforming, electrolysis, and coal gasification for hydrogen production

## Regional New England MARKAL Model

## Regional MARKAL: Motivation

- Decisions about technology and impacts from technology choice occur at regional/local scales
- Policy actions relevant to climate and air quality are being taken at regional/local scales
- e.g., GHG mitigation, criteria air pollutants, technology portfolio standards, systems benefits charges, etc.
- States and local entities need tools to assess energy-technology-environment policies

## New England Pilot Project

- Northeast States for Coordinated Air Use Management (NESCAUM) – Interstate air quality modeling and policy analysis organization
- Six states, each to be modeled as own region; ~ 14 million people total
- Significant energy differences from rest of U.S.
- little resource production
- greater reliance on oil for heat and electricity generation
- Focus on air quality and climate issues

## New England Model Project Plan

- NESCAUM is coordinating, hosting, and running model
- State Air and Energy offices are revising national model, substituting state-specific data where available
- Stakeholder process for development of future scenarios began last summer (2003)
- Identify and engage regional stakeholders
- Assess available data and fill gaps

## Outcomes: The New England Pilot Project Will Help EPA . . .

- Determine what data are readily available at state and regional levels and what gaps must be filled
- Prepare structures for handling regional model data
- Test the model development and utilization process
- Provide a working example of the value a regional model can offer

## For More Information Please Contact:

- Tim Johnson
- (919) 541-0575
- johnson.tim@epa.gov

- US EPA
- Mail Drop E305-02
- 109 T.W. Alexander Drive
- Research Triangle Park, NC 27711