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Modeling Detailed Energy-Efficiency Technologies and Technology Policies within a CGE Framework

Abstract:
Policy makers and analysts are raising questions about the adequacy of policy and technology representation in conventional energy and economic models. Most conventional models rely on a highly stylized and limited characterization of technology. In these models, any desired changes in energy demand are driven largely by pure price mechanisms such as energy taxes or carbon charges. In this paper, however, we explore the mapping of discrete technology characterizations and examine how cost-effective technologies and programs might prompt desirable increases in energy efficiency. Using the commercial health care sector as an example, we show how changes in energy efficiency and technology investments might be more properly represented in policy models.

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Energy Specializations: Energy Investment and Finance – Corporate Strategy; Energy Efficiency; Renewables – Policy and Regulation

JEL Codes:
D92 - Intertemporal Firm Choice: Investment, Capacity, and Financing
Q55 - Environmental Economics: Technological Innovation
Q52 - Pollution Control Adoption and Costs; Distributional Effects; Employment Effects

Keywords: Energy efficiency, CGE model, Technology policy, AMIGA model, Commercial lighting

DOI: 10.5547/ISSN0195-6574-EJ-VolSI2006-NoSI2-8


Published in Hybrid Modeling, Special Issue #2 of The Quarterly Journal of the IAEE's Energy Economics Education Foundation.