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Combining economic modelling and
hybrid LCA to assess prospective
energy scenarios in Luxembourg
Elorri Igos, Benedetto Rugani, Sameer Rege, Enrico Benetto, Laurent
Drouet, Dan Zachary
Public Research Centre Henri Tudor (CRPHT) / Resource Centre for Environmental
Technologies (CRTE)
6A, avenue des Hauts-Fourneaux, L-4362 Esch-sur-Alzette (Luxembourg)
Research question
Consequential LCA
of energy policy
Partial Equilibrium
Models (PEM) (profit maximization of one
specific sector or market)
Computable General
Equilibrium models
(CGE) (Representation of the full economy)
(process-based LCA) (I/O-based analysis)
2
Objectives
LUXEN “Integrated assessment of future
energy scenarios for Luxembourg”
Objective: Evaluate the environmental consequences of adopting an energy
policy of GHG emissions reduction as compared to the Business-As-Usual
(BAU) scenario for the time horizon 2010-2025.
Harmonize and couple two equilibrium models to model Luxembourg’s economy
and the energy sector in detail.
Adapt the hybrid LCA framework to assess the related environmental impacts.
Environmentally-
Extended Input-
Output model
3
4
Methods Energy Techno-Economic Model (ETEM)
Bottom-up partial equilibrium model for Luxembourg energy sector1
20 energy commodities and more than 650 technologies
Most cost-efficient energy system until 2025 (calibration on 2005)
Projection of energy demands:
socio-economic drivers
Energy-related emissions
(CO2, CH4, NOx, N2O, NMVOC, PM)
5
Methods Energy Techno-Economic Model (ETEM)
1Drouet, Rege (2012). LUXEN Deliverable 1.1 – Luxembourg Energy Review. Programme FEDER, CRPHT, STATEC
Luxembourg. September 2011 (update March 2012).
6
Methods LUXembourg General Equilibrium Model (LUXGEM)
Dynamic multi-sector general equilibrium model for Luxembourg1
16 branches of activity, 20 commodities, 1 representative household
Response to prices: changes in consumption from elasticity of substitution
Decision making process:
choice to consume and save
Energy use and GHG emissions
7
Methods LUXembourg General Equilibrium Model (LUXGEM)
1Adam et al. (2010). Luxgem: modèle d’équilibre général calculable pour le Luxembourg. Cahier économique No.110.
Statec, Luxembourg.
8
BAU scenario
Reduction of 2.74%/year for CO2, CH4
and N2O (cumul, ~ 50%) in ETEM
Change in energy intensity by energy
source in each sector
Change of ETEM energy technology
(lower emissions and fuel cons.)
Methods Harmonizing and Coupling ETEM & LUXGEM
Value added
Energy efficiency parameters
LUXGEM ETEM Driver:
Energy
demand
Drivers:
GDP, pop.,
commuters
GHG scenario
Environmentally
-Extended Input-
Output model
9
Methods From economic coupling to environmental
assessment
Characterization
phase:
Environmental
Impact
Assessment
(ReCiPe)
Physical units/ € net consumption
LUXGEM > Final EEIO
model (16×16)
€/€
EEIOT Dom. production
+ Imports
ETEM > Process-based
LCA (energy sector)
Energy sector Dom. production
+ Imports
€/MJ
MJ/MJ
Net Consumption =
Production + Imports - Exports
10
Methods Environmentally-Extended Input-Output (EEIO)
11
Results & Discussion Economic equilibrium models coupling
Results for the electricity
consumption (TJ) of the
different sectors
LUXGEM after coupling
LUXGEM before coupling (≠ models
of investment in renewable)
COMTOT: Total consumption
LE_HOU: Household sector
LE_PRD: Energy production sector
LE_AGR: Agriculture sector
LE_IND: Industry sector
LE_TRA: Transport sector
LE_CON: Construction sector
LE_OTH: Others
12
Results & Discussion Economic equilibrium models coupling
Emissions reduction obtained in ETEM for the scenario « GHG »,
as compared to the scenario « BAU »
-14%
-12%
-10%
-8%
-6%
-4%
-2%
0%
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
Emis
sio
ns
red
uct
ion
in E
TEM
CO2
CH4
N2O
13
BAU scores > GHG scores: between 2.3% and 3%.
Main differences observed on climate change and fossil depletion impacts.
Results & Discussion Environmental consequences of GHG scenario
-3,5%
-3,0%
-2,5%
-2,0%
-1,5%
-1,0%
-0,5%
0,0%
-80
-70
-60
-50
-40
-30
-20
-10
0
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
20
19
20
20
20
21
20
22
20
23
20
24
20
25
Imp
ac
t re
du
cti
on
on
sin
gle
sc
ore
(M
Pt)
Climate change HH Climate change Eco Human toxicity
Particulate matter formation Natural land transformation Fossil depletion
Others Total %
14
Increase of imported electricity and production from municipal solid waste
Decrease of imported petrol, kerosene and natural gas.
-40%
-30%
-20%
-10%
00%
10%
20%
30%
40%
50%
60%
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
Dif
fere
nce
bet
wee
n s
cen
ario
s ([
GH
G-B
AU
]/B
AU
) IMP_Diesel, low-sulphur
IMP_Electricity, BE
IMP_Electricity, DE
IMP_Natural gas, high pressure
IMP_Petrol, low sulphur
DOM_Financial intermediation services
DOM_Insurance and pension fundings
DOM_Research and development services
IMP_Kerosene
DOM_Electricity production, CHP CEDUCO
DOM_Electricity production, CHP TWINERG
DOM_Electricity production, MSW SIDOR
IMP_ Metalliferous ores and metal scrap
IMP_Textile yarn, fabrics
IMP_Iron and steel
IMP_Office machines
IMP_Electrical machinera, apparatus
Results & Discussion Comparison of processes impacts
15
General trends:
Increasing impacts over time (~30% between 2010 and 2025) due to
consumption growth.
Main impact categories: climate change and metal and fossil depletion.
Contribution analysis:
Most of the impacts (~85%) are related to imported commodities (metalliferous
ores/metal scrap, natural gas, kerosene and German electricity mainly).
Among the energy production technologies:
Most of the impacts come from one plant producing electricity from natural gas.
One plant which contributes up to 6% for the scenario BAU disappeared in the
scenario GHG.
Results & Discussion Analysis of Luxembourg net consumption impacts
Conclusions and outlook
Perfect economic coupling does not occur due to the embedded
constraints of the equilibrium models and to differences in the modelling
philosophy.
The hybrid LCA, compatible with economic coupling outputs, gives an
overview of the impacts of the total net consumption of Luxembourg with
specific details for the energy sector.
The environmental consequences of scenario GHG are overall beneficial
but can be negative on some impacts (e.g. ionizing radiation) due to higher
electricity imports.
Sensitivity and uncertainty analyses are in progress in order to identify the
influencing model parameters and uncertainties of the assessment results.
16
On LUXEN:
Elorri IGOS
For additional information or specific questions:
On the hybrid IO model:
Benedetto RUGANI
On the equilibrium models:
Sameer REGE
http://ingienous.com/
?
ACKNOWLEDGEMENTS
17
Supplementary Information
18
Harmonization:
Economic sectors aggregation
Relative prices (€/TJ):
• ETEM => Outputs in TJ
• LUXGEM => Outputs in €
19
Methods Harmonizing and Coupling ETEM & LUXGEM
20
Build the EEIO framework to include LUXGEM outputs:
Methods Environmentally-Extended Input-Output (EEIO)
Environmental extensions: World
Input Output Database
Import processes: Swiss Input
Output Database
Average values per sector
1995-2009
Cut-off of EE
for energy sector
Cut-off of energy
imports for all sectors
Aggregation 43x43 16x16
21
Energy type Ecoinvent module of reference Features
Ener
gy i
mp
ort
s
Air heat potential -
Domestic input (natural resource)
Hydraulic energy Energy, potential (in hydropower reservoir), converted [in water] Municipal solid waste - Solar energy Energy, solar, converted [in air]
Wind energy Energy, kinetic (in wind), converted [in air]
Biodiesel Rape methyl ester, at regional storage [CH]
Imported input (cradle-to-gate unit process from ecoinvent)
Biogas Biogas, mix, at agricultural co-fermentation, covered [CH]
Coal Hard coal, at regional storage [LU] Diesel oil Light fuel oil, at regional storage [RER]
Natural gas Natural gas, high pressure, at consumer [RER]
Gasoline Petrol, low-sulphur, at regional storage [RER] Imported electricity Electricity, prod. mix [BE]; Electricity, prod. mix [DE] Kerosene Kerosene, at regional storage [RER]
Liquefied petroleum gas Liquefied petroleum gas, at service station [CH]
Refined fuel oil Light fuel oil, at regional storage [RER] Wood and wood waste Wood chips, mixed, u=120%, at forest [RER]
Ener
gy p
rod
uct
ion
te
chn
olo
gies
Electricity, from nat. gas Electricity, natural gas, at power plant [LU] Included: - Direct resource extraction and emissions as domestic - Fuel input as import Excluded: Other exchanges with technosphere to avoid double-counting Allocation rules based on energy
Electricity, from hydropower Electricity, hydropower, at power plant [LU] Electricity, from photovoltaic Electricity, production mix photovoltaic, at plant [LU] Electricity from MSW Electricity from waste, at municipal waste incineration plant [CH]
Electricity, from biogas Electricity, at cogen with biogas engine, agricultural covered, alloc. exergy [CH]
Electricity, from wind Electricity, at wind power plant 600kW [CH] Heat, from natural gas Electricity, natural gas, at power plant [LU] Heat, from biogas Heat, at cogen with biogas engine, agricultural covered, alloc. exergy[CH]
Heat from wood Heat, mixed chips from forest, at furnace 1000kW [CH]
Methods Environmentally-Extended Input-Output (EEIO)
22
Ionizing radiation impacts for GHG scenario: increased electricity import
(especially from Belgium, which imports nuclear energy from France).
Results & Discussion Comparison of midpoint impacts
-10%
-5%
0%
5%
10%
15%
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
Co
mp
aris
on
be
twe
en
sce
nar
ios
([G
HG
-BA
U]/
BA
U)
Climate change
Ozone depletion
Terrestrial acidification
Marine eutrophication
Photochemical oxidant formation
Particulate matter formation
Terrestrial ecotoxicity
Urban land occupation
Natural land transformation
Fossil depletion
Freshwater ecotoxicity
Marine ecotoxicity
Agricultural land occupation
Metal depletion
Freshwater eutrophication
Human toxicity
Ionising radiation
Lower impacts
for scenario GHG
GHG and BAU
are similar (< 1%
of difference)
Lower impacts
for scenario BAU