Catur Kurniadi 6/12/2009

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Dear Charlie,

Can we calculate demand cost if we use macroeconomic methodology to calculate final energy consumption in LEAP?

Regards,

Catur

Charlie Heaps 6/12/2009
 

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> Can we calculate demand cost if we use macroeconomic methodology to calculate final energy consumption in LEAP?

Hello Catur,

By "macroeconomic methodology" I am assuming you mean some kind of top down structure in which you do not have detailed information about specific devices using energy. Instead you have a more aggregate structure (e.g. fuel use by sector). Is that correct?

Either way, yes, you can calculate demand costs. LEAP give you a number of choices about how to specify demand costs. In cases where you DO have information about specific devices then you can use the activity cost method which allows you to specify the cost of alternative devices (e.g. efficient refrigerators vs. standard refrigerators). LEAP will count up the number of devices to calculate the overall demand-side capital costs of each scenario.

But as I understand it from your email, in your case that methodology wont work because you don't have actual numbers to devices to count up.

So instead you can use the "Cost of Saved Energy" (CSE) methodology. This lets you specify how much it costs to save a unit of energy in one scenario relative to a reference (baseline) scenario. To use this method you will need to find external studies that say how much it costs to save energy in different sectors. In LEAP, these numbers are used as multipliers. The difference in energy consumption between one scenario and the baseline scenario is multiplied by the CSE to yield total costs.

Notice the all of the above only deals with demand-side capital and operating & maintenance (O&M) costs. LEAP also allows you to separately specify Transformation capital, O&M and decommissioning costs and to specify the overall unit costs of each type of fuel used in LEAP. You can also capture the externality costs of pollution.

For more information, please see:
http://tinyurl.com/mqccrf

I hope this helps,

Charlie

Catur Kurniadi 6/15/2009
 

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Yes that is correct.

Thanks for your information.