Overview of the Energy and Power Evaluation Program (ENPEP-BALANCE)

Center for Energy, Environmental, and EconomicSystems Analysis (CEEESA)Decision and Information Sciences Division (DIS)Argonne National Laboratory9700 South Cass AvenueArgonne, IL 60439

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ENPEP-BALANCE Is Designed to Analyze the Entire Energy System in an Integrated Framework

Reveal cross-sectoral effects; provide structure for consistent energy “planning” program

Integrated framework allows evaluation of feedback effects

Price of Coal/Carbon Tax

Demand for Coal

Demand for Electricity

Price of Electricity

Atmospheric Emissions

ResidentialSector

ElectricSector

CoalSector

OilSector

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SupplyDemand

Equilibrium

INPUTINPUT

Energy systemstructure

Base-year energyflows and prices

Energy demandgrowth projections

Technical andpolicy constraints

BALANCEBALANCE

OUTPUTOUTPUT

Quantity

Price/Cost

ENPEP-BALANCE Determines the Equilibrium Supply/Demand Balance of the Energy System

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ENPEP-BALANCE Uses an Energy Network to Simulate Energy Markets

Transmission and Distribution of Oil Products, Coal, Electricity, and Other Fuels/Resources

Residential Paper Industry

OtherIndustry

Food Proc.Industry

Agriculture& Fishing Transport Commercial

CementIndustry

ChemicalIndustry

CeramicIndustry

TextileIndustry

Electric Sector

Oil and Gas Supply Sector Coal Supply Sector Renewables and Others Sector

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Networks Consist of Nodes and Links

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By Using Nodes and Links, Each Sector Is Modeled Differently Depending on Data Availability and Type of Issue Analyzed

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The Following Node Types Are Available to Model Different Energy Activities

Demand

Conversion Processes

Resource Processes

Economic Processes

Electricity Dispatch andThermal and Hydro Units

Single In-/Output Multi Output Multi Input Transport

Depletable Renewable

Decision/Allocation Pricing

Central Dispatch Thermal Unit Hydro Unit

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Nodes Are a Series of Simple Submodels, Each with a Set of Quantity and Price Equations

Price output = f ( Price input )– Example conversion process

Revenue = CostQout x Pout = Qin x Pin + O&M + Capital Recovery

Q in

Q out

P in

P out

ConversionProcess

Quantityoutput = f ( Quantityinput )– Example conversion process

Qout = Qin x EE: conversion efficiency

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The Links Connect the Nodes and Pass Information from One Node to Another

Q in,1

P in,1

Q out,1

P out,1

Q in,2

P in,2

Q out,2

P out,2

ConversionProcess

ConversionProcess

Q out,1 = Q in,2

P out,1 = P in,2

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At the Decision Nodes, Fuels and Technologies Compete for Future Market Shares

Solar

Gas Heater

Wood Heater

Electric Heater

Solar Heater

Electric Heater

Gas Heater

SpaceHeat

WaterHeat

Cook-ing

Residential space heat can be provided by four competing technologies

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Increasingprice sensitivity

ENPEP-BALANCE Uses a Logit-Function to Estimate Market Shares of Competing Commodities at the Decision Node

γ: price sensitivity forthis decision process

MS: market shareP: pricePM:Q: quantity

premium multiplier

MS1 = Q1

Q1 + Q2=

1P1 x PM1

γ

+1

P1 x PM1

γ1

P2 x PM2

γDecision

P1 Q1 P2 Q2

Qdemand

0.0

0.5

1.0

0.00 0.25 0.50 0.75 1.00 1.25 1.50 1.75 2.00Relative Price (P1/P2)

Mar

ket S

hare

Pro

duct

1

y = 1 y = 3 y = 5 y = 10 y = 50

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The ENPEP-BALANCE Nonlinear Equilibrium Algorithm Is Based on Decentralized Decision Making

Market share calculation assumes “ideal market” subject to government policies, fuel availability, and market constraintsA lag factor accounts for delays in capital stock turnoverThe result is a nonlinear, market-based equilibrium solutionwithin policy constraints, not a simple, linear optimizationNo single person or organization controls all energy prices and decisions on energy useAll decision makers optimize their energy choices based on their own needs and desires

0.0

0.5

1.0

0.00 0.25 0.50 0.75 1.00 1.25 1.50 1.75 2.00Relative Price (P1/P2)

Mar

ket S

hare

Pro

duct

1

y = 1 y = 3 y = 5 y = 10 y = 50

ENPEPSimulation

0.0

0.5

1.0

0.00 0.50 1.00 1.50 2.00 2.50Relative Price (P1/P2)

Mar

ket S

hare

Pro

duct

1

Optimization

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The Electricity Dispatch Node Handles the Electric Sector in a Special Way (more details on electricity in separate lecture)

Coal Nuclear Fuel Gas

HydroPlants

NuclearPlants

CoalPlants

Transmission / Distribution

ElectricSector

GasPlants

Dispatching

FUEL PRICES FROM THE UP-PASS

ELECTRICITY DEMANDFROM THE DOWN-PASS

Adj

ustm

ents

Are

Mad

e to

the

Elec

tric

Sec

tor d

urin

gth

e Ite

ratio

n Pr

oces

s

Up to 999 thermal+hydro units

Load

(fra

ctio

n of

pea

k)

0

1

0 0.2 0.4 0.6 0.8 1Time (fraction)

0

1

Minimum Load

Load

Up to 20 fuel input

links

Special hydro power plant

representation

Merit order or user-specified dispatch order

Up to 20 generationoutput links

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ENPEP-BALANCE Uses an Up/Down Pass Sequence and the Jacobi Iterative Technique to Determine the Market Clearing Prices and Quantities at Market Equilibrium (more details on up-down in separate lecture)

Q1up = Q1down ? Q2up = Q2down ?

Pric

es C

ompu

ted

on U

p-Pa

ss

P1 P2

P3 P4

P5

Quantity

Cos

t (Pr

i ce)

Quantity

Cos

t (Pr

i ce)

TimeD

eman

d0 .0

0 .5

1 .0

0 .0 0 0 .25 0 .50 0 .75 1 .00 1 .2 5 1 .50 1 .7 5 2 .00

Qua

ntiti

es C

ompu

ted

on D

own-

Pass

Q1

Q3 Q4

Q2

Q5

ConversionProcess

DEMAND

Depletable Resource

ConversionProcess

Depletable Resource

L1

L3 L4

L2

L5

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The Up-Pass and Down-Pass Tell the Model in Which Sequence to Perform the Calculations (Which Node Comes When)

Up-pass and down-pass sequences are repeated until convergence is achieved

CONVERGENCE IS ACHIEVED WHEN:

– Q1 (down) = Q1 (up) +/- Tolerance Level

– Q2 (down) = Q2 (up) +/- Tolerance Level

– The final result is a converged solution

– The solution is in equilibrium across the whole network

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Execution of the Up/Down Pass Sequencer in ENPEP-BALANCE

Run the Up/Down Pass Sequencer before running ENPEP-BALANCE for the first timeThis will determine the “node visitation sequence”Later, the Up/Down Pass Sequencer must be executed only if there has been a CHANGE IN THE STRUCTURE of the energy network– Add/delete nodes– Add/delete links

Click here to run the Up/Down Pass Sequencer

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The Calculated Up/Down Node Visitation Sequence Can Be Viewed in Tabular Form

This screen also allows the user to manually adjust the node visitation sequence, if necessary.

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The Up/Down Node Visitation Sequence Can Be Viewed Directly in the Network

The up-pass sequencestarts from the resourcenodes, while the down-pass sequence starts from the demand nodes

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Each Case Study Can Be Stored in a Different Database

Here is the path and name of the

database file

Add an existing database to this

list

Create a new (blank)

database

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The First Step in Developing an ENPEP-BALANCE Network Is to Define the Sectors Included in Your System

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Each Sector May Be Modeled Differently Depending on Data Availability and Type of Issue Analyzed: Power Sector Can Be Modeled at the Unit Level

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Intersectoral Links Can Connect Energy Networks of Different Sectors

Link 301 Connects to Sector 3

Link 301 Connects to

Sector 1

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The Level of Detail May Vary from Simple to Complex: Example: Simple Fertilizer Industry and More Complex Oil & Gas Sector

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All Network Elements in ENPEP-BALANCE Can Be Accessed By Using a Standardized Simple Menu

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Results Can Be Viewed Interactively for Individual Network Components and the Entire System

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ENPEP-BALANCE Uses a Standard Methodology to Determine the Uncontrolled and Controlled Source Emissions

ControlledEmissions

UncontrolledEmissions x (100 - Control Efficiency) / 100=

Uncontrolled Emissions = Emission

FactorFuel

Consumption x x Chemical Scale

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Emissions Are Calculated and Reported by Node for Any Pollutant the User Specifies (more details on emissions calculations in separate lecture)

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Environmental Results Can Be Viewed Directly in the Network, in Tables, Simple Graphs, or Exported to EXCEL

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A Help System Is Available to Provide Online Support

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Information on ENPEP-BALANCE Applications Is Available on Our Website

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As Do All Models, ENPEP-BALANCE Has Limitations

The market share formula needs to be applied carefully to produce “reasonable”results (particularly check the transition from 1st to 2nd year)

The solution is generated year by year and is said to be “myopic”

– However, in today’s short-term-oriented energy markets, this may actually be an advantage

If not set up in sufficient detail, it can be insensitive to price

Nevertheless, the ENPEP-BALANCE approachhas proven itself to be powerful and useful(if applied correctly)

ENPEP-BALANCE is a tool

– A tool should be used wisely

Also, if the only tool you have is a hammer, then everyproblem starts looking like a nail