Technological change in energy - POLES

Model Documentation - POLES
Model scope and methods - POLES Model concept, solver and details - POLES Temporal dimension - POLES Spatial dimension - POLES Policy - POLES Socio-economic drivers - POLES Population - POLES Economic activity - POLES Macro-economy - POLES Production system and representation of economic sectors - POLES Energy - POLES Energy resource endowments - POLES Fossil energy resources - POLES Uranium and other fissile resources - POLES Bioenergy - POLES Non-biomass renewables - POLES Energy conversion - POLES Electricity - POLES Heat - POLES Gaseous fuels - POLES Liquid fuels - POLES Solid fuels - POLES Grid, pipelines and other infrastructure - POLES Energy end-use - POLES Transport - POLES Residential and commercial sectors - POLES Industrial sector - POLES Other end-use - POLES Energy demand - POLES Technological change in energy - POLES Land-use - POLES Emissions - POLES Carbon dioxide removal (CDR) options - POLES Climate - POLES Non-climate sustainability dimension - POLES Appendices - POLES Data - POLES References - POLES
Corresponding documentation
AIM-Hub BLUES C3IAM COFFEE-TEA DNE21+ GCAM GEM-E3 GRACE IFs IMACLIM IMAGE MESSAGE-GLOBIOM POLES PROMETHEUS REMIND-MAgPIE TIAM-UCL WITCH
Previous versions
Archive of POLES version ADVANCE
Model information
Model link	http://ec.europa.eu/jrc/en/poles https://ec.europa.eu/jrc/en/publication/poles-jrc-model-documentation-0
Institution	JRC - Joint Research Centre - European Commission (EC-JRC), Belgium, http://ec.europa.eu/jrc/en/.
Solution concept	Partial equilibrium (price elastic demand)
Solution method	SimulationRecursive simulation
Anticipation	Myopic

Technological change in the various sectors takes place through competition in the new capacity planning ("gap", multinominal logit), which depends on expected utilisation costs of the competing technologies (myopic anticipation, no perfect foresights). Technological change is constrained by the vintage of existing capital stock ("unscrapped consumption") and resource availability. In addition to upgrading possibility, accelerated retirement can be considered in some specific cases (e.g. some coal plants in the power generation sector).

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Schematic of the energy needs and depreciation procedure in POLES

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Costs usually consider fixed costs (investment, lifetime, O&M, discount rate) and variable costs (fuel price, efficiency, O&M).

Investment costs can be exogenously set or endogenously simulated through learning curves (1 or 2-factors learning curves) depending on the sector.

It must be noted that the competition also considers, in addition to the cost component, a "reality parameter" that is calibrated (directly in the model or with external procedures) to replicate the historical situation given used cost estimates. This parameter is essential to compensate for imperfect cost estimates or to capture drivers of economic decisions that are poorly or not at all represented in the model (national industrial policy choices, etc..). The model also includes the possibility to test "network effect" for new technologies (accelerated adoption beyond some market share threshold).