Modelling renewable energies in macroeconomic energy-climate models

The currently operating fossil-fuel-based energy system has proven to be one of the main drivers of earth system change. It has become to be the main driver for climate change. The transition from the fossil-fuel-based energy... [ view full abstract ]

The currently operating fossil-fuel-based energy system has proven to be one of the main drivers of earth system change. It has become to be the main driver for climate change. The transition from the fossil-fuel-based energy system to a renewable-based energy system is one of the widely advocated and modelled solution pathways for achieving long-term sustainable development and climate change mitigation. However, results regarding their contribution to climate change mitigation and sustainable development are dependent on the assumptions made with regards to renewable energies. Therefore, the study deals with the following research question: How to model renewable energies in macroeconomic energy-climate models? To answer this question, we analyse renewable energies and their technological, environmental and economic characteristics in a disaggregated manner. This is followed by an overview of current macroeconomic energy-climate models, where we describe different approaches applied to model renewable energies and discuss simulation results. Based on the review of current practices of modelling renewable energies and contrasting it with other research in the energy field (e.g. resource limitations on harvesting technologies, impact of climate change on renewable energy), we explore the gap between the current knowledge on renewable energy potentials and modelling practices. Thereby, we challenge the assumptions of many models that renewable energies are unlimited and that their relation to climate change is unidirectional. To support this argument and to present a possible advanced way of modelling renewable energies, we built a model structure that starts from the existing model structures regarding renewables but also allows to incorporate the necessary environmental, technological and economic, characteristics found in the relevant literature of renewable energy on a global and local scales. The method applied to build this model structure is System Dynamics. There are two main goal of our modelling effort: (1) gaining insights into how different assumptions on renewables can affect model results and (2) identifying the most relevant characteristics to be considered in order to draw the right conclusions on how renewable energies can contribute to climate change mitigation, and how long-term sustainable energy system can be designed.

Keywords: energy, climate change, renewables, resource limits