Nonelectric solar energy is included with conservation technologies as a reduction in the demand for marketed fue ls. The four secondary fuels are consumed to produce energy services. The demand for energy services in each region's end-use sectors is determined by the cost of providing these services and by the levels of income and population. The mix of secondary fuels used to provide these services is determined by the relative costs of providing these services using each alternative fuel. The demand of fuels to provide electric power is then determined by the relative costs of production, as is the share of oil and gas transformed from coal and biomass.
Energy supply is disaggregated into two categories, renewable and non-renewable.
Note here that nuclear is treated in the same category as fossil fuels. Nuclear power is constrained by a resource base as long as light-water reactors are the dominant producers of power. Breeder reactors, by producing more fuel than they consume, are mo deled as an essentially unlimited source of fuel that is available at higher cost. A rate of technological change is also introduced on the supply side. This rate varies by fuel and is expected to be both higher and less certain for emerging technologies.