Task Force on Global Warming

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Work Groups

Modeling Process

Governor's Task Force on Global Warming
Modeling Process

In order to meet its obligations in a complete and professional manner, the Task Force elected to conduct a modeling exercise to estimate the potential greenhouse gas (GHG) reductions and economic impacts resulting from proposed policies. After considering several proposals the Technical Advisory Group (TAG) recommended that Wisconsin hire the consulting firm of ICF International to perform the modeling.

Because modeling related information crosses the organizational lines of the Global Warming Task Force website this page was created to host materials specific to the modeling process. The page is organized into the following sections:

Background on Modeling

These presentations were given to the Task Force on September 20, 2007 and explain the modeling process.

Reference Case

The first step in the modeling process was developing a "Reference Case." The Reference Case represents a projection of how Wisconsin’s economy, energy use and GHG emissions might develop in the future, given the policies and trends of the time, and absent any additional GHG reduction policies. The Reference Case was a standardized point of comparison to estimate and evaluate the impacts of the policies developed by the Work Groups on GHG emissions, energy use, energy costs and the overall Wisconsin economy.

ICF International developed the Reference Case using ENERGY2020, their multi-sector model which provided Wisconsin specific energy and emissions output data. ENERGY2020 incorporated a macroeconomic forecast (Regional Economic Model, Inc. - REMI) of the state supplied by the Wisconsin Department of Transportation. Additionally Winrock International evaluated GHG sources and sinks in the forestry and agriculture sectors, areas of important potential in Wisconsin.

The TAG worked diligently to be sure that the data used for these purposes was as Wisconsin-specific as reasonably possible and that the assumptions employed were reasonable. The Assumptions Book is a detailed accounting of all underlying data sources and assumptions developed by the TAG for the Reference Case.

The development of the Reference Case was very sensitive to the assumptions used. It was not intended to be an accurate prediction of the future. Instead, it was a projection, based on facts understood at the time, that was reasonable for evaluating and recommending policies to meet the requirements of Executive Order 191.

Assumptions Book

Memos to the TAG from ICF International describing Reference Case development and outputs

Presentations

Supporting Documents for the Reference Case
Reference Case output from ENERGY2020 is presented below. Because the modeling process was highly data intensive, the output is presented in spreadsheet format. These spreadsheets contain key parameters of the Reference Case, primarily in the power sector.

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Policy Analyses

The TAG analyzed several policy combinations to assess their impact on GHG emissions, energy use, energy costs and the overall Wisconsin economy. These policies were developed by the Work Groups and recommended by them for modeling. The policies were modeled in combination as policy packages, or scenarios, to account for possible linkages and interactions between individual policies. The policy modeling outputs were then compared to the Reference Case outputs.

The same cautions and caveats apply to the results of the modeling of policy scenarios as those discussed above for the Reference Case. The scenarios represent projections of what may happen in the future if the policies were implemented under a certain set of assumptions. The modeling results are highly sensitive to these assumptions and are indicative of what could be achieved if the policies were implemented, but they do not guarantee are predicted outcome. The assumptions used to model the policies are described in the Assumptions Book (Section 4.10).

The following scenarios were modeled:

  • Policy Scenario 1 - All policies except cap and trade policies. These include:
    • Enhanced conservation and energy efficiency program
    • Residential and commercial building codes
    • State appliance efficiency standards
    • Rental lighting standards
    • Biomass and biofuel (State bioenergy use)
    • California vehicle emission standards
    • Low carbon fuel standard
    • Energy efficient communities
    • Enhanced renewable portfolio standard
  • Policy Scenario 2 - Same as above but without California vehicle emission standards.
  • Cap and Trade - Policy Scenario 01 including cap and trade:
    • Scenario 3 - CT03: 100% auction of allowances; no regulatory limit on the use of offsets
    • Scenario 4 - CT04: 100% auction of allowances; offsets capped at 10% of allowances in any year

    Note: Due to the complexities of modeling the cap and trade policy scenarios, the TAG recommended that the Task Force not rely on the modeling results associated with these specific runs. The TAG documented the lessons learned and its observations to the Task Force. Modeling was also started for a cap and trade policy based on 100% allocation of allowances, without an auction, but time ran out before this could be completed.

  • High Energy Price Sensitivity Run - This was a sensitivity run to test the effects of higher fuel prices and assumed 50% higher prices for coal, natural gas, oil and biomass than in the original reference or policy cases. This sensitivity run was modeled for both the Reference Case and Policy Scenario 1.
  • Policy Scenario 10 - Deep Reduction Scenario - This was another sensitivity run to test the effects of deep reductions in carbon dioxide emissions from the power sector.

Memos to the TAG from ICF International describing the model outputs for particular policy scenarios and comparing those outputs to the Reference Case outputs.

Presentations to the Task Force either describing the model outputs for particular policy scenarios or presenting insights into the modeling analyses.

Reports

  • Summarizing Power Sector Modeling Runs [PDF 143 KB]
    This report on the Electric Power Sector modeling effort was written by the TAG to provide documentation and information to more fully understand its efforts and insights in modeling the Electric Power Sector templates.

Supporting Documents for the Policy Analyses
Policy Analyses output from ENERGY2020 is presented below. Because the modeling process was highly data intensive, the output is presented in spreadsheet format. These spreadsheets compare the modeled policy scenario outputs to the reference case for key parameters, primarily in the power sector.

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Last Revised: Thursday November 06 2008