PNNL

Abstract

Comprehensive study of the environmental impacts associated with demand for an energy resource or carrier in any one sector requires a full consideration of the direct and indirect impacts on the rest of the regional and global energy system. It is important to consider the energy that is consumed in producing primary energy resources and energy consumed in transporting these energy resources internationally and domestically in order to produce a complete picture of these impacts. Biofuels are especially complex since they have feedbacks not just to the energy system but also to regional and global crop markets. Different modeling and analysis strategies have been applied to consider these impacts, which occur “upstream” of final energy consumption, with some success. Traditional life cycle models allow for rich technological detail in linking upstream impacts of energy demand with downstream final consumption; however, they cannot by themselves represent dynamic economic feedbacks across multiple sectors and regions over time. Computable general equilibrium (CGE) modeling does account for economic feedback among all sectors and regions; however, CGE modeling does not lend itself to physical representation of technological detail. Partial equilibrium (PE) modeling is a heterogeneous category describing economic models that focus on a subset of the economy, and they differ in coverage and ease in incorporating more sectors and economic links. In this study, we present a strategy for dynamically including the direct and indirect impacts of energy demand with physical and technology detail by explicitly adding these upstream energy and transportation links to GCAM, a PE model of global energy, land use, and emissions. We incorporate the following inter-sectoral linkages: energy inputs to crop production, energy inputs to fossil resource production, and freight transport requirements of energy and agricultural commodities. We assess the implications of explicitly including these links by measuring the global impacts of increased corn ethanol demand in the United States with and without these links included. Although the net global impact of the upstream links on energy and emissions are relatively modest in the scenarios we studied, the inclusion of these links illustrates interesting trade-offs in energy and transportation demand among fossil fuel and agriculture sectors. These sectoral interactions suggest that this level of modeling detail could be important in evaluating future analytical questions.