# Incorporating New Technologies in EEIO Models
## 2 Methodology
### Augment/Modify Make and Use Tables  
The core of this step is the substitution between the current product or commodity (further on called _similar commodity_) and the new product (further on called the _new commodity_). The idea is to understand what will happen in a future economy where the new commodity has replaced a part of existing commodity's production and demand, which, at the end, is the goal of developing these types of new products. To understand the effect of different levels of adoption of the new commodity, we assign a percentage of substitution (%). In reality, the penetration of the new commodity in the economy will be the result of market interactions responding to price and consumers preferences. The extent of adoption is not predicted by the model.  
This new commodity can be produced in different ways using different new technologies. Therefore, to include the new product in the economy, two changes are made. A new commodity is added, and new industries are added. Each industry will represent each new technology that can produce the new commodity. Adding each technology as an industry allows assessment of scenarios in which the new commodity is being produced solely by one new technology and also where it is being produced by a technology mix. This provides the capability not only to assess the overall environmental impacts of the introduction of the new commodity in the whole economy, but also to compare the environmental impacts of different new technology options.  
We evaluate the effect of all current industries using the similar commodity as input and thus we replace part of their use with the new commodity. This results in the _similar industry_ (the primary producer of the similar commodity) decreasing its output. One challenge is that the new commodity may be similar in function but not in price. In environmentally motivated technology development, the intent is, for example, to substitute a M] of fossil fuel by a M] of bio-fuel or a kg of plastic by a kg of bio-plastic. As of this, a first step is to determine the physical units of interest for the substitution (For example, in our advanced biofuels case study, it will be gallons of gasoline equivalent (GGE).) Once this unit is chosen, the future production and consumption of the new commodity and the similar commodity can be calculated.  
Let \(s_{1}\) be the index for the similar commodity and \(s_{2}\) be the index for the similar industry. Let \(m\) be the number of commodities, \(n\) be the number of industries and \(\Gamma\) be the number of final users in current economy. It is assumed that each technology will be an additional industry; therefore, this methodology adds one commodity and \(k\) industries to the current IO tables.  
To calculate and incorporate new production and consumption amounts into the Make and Use tables, physical units need to be transformed into monetary units and vice versa.  
For this, the price per unit of the similar commodity \(p_{s_{1}}\) and the price per unit for the new commodity being sold by each of the new industries are required (\(p_{m+1,tech-1}\), \(p_{m+1,tech-2}\), \(\ldots,p_{m+1,tech-k}\)). These are in purchaser prices. The underlying assumptions and implications of the prices used can be found in Appendix B.