Scenario analyses

It is technically feasible to construct an energy system that is not based on coal, oil natural gas. This has been demonstrated by the Danish Energy Agency (DEA) in a report entitled “Energy Scenarios for 2020, 2035 and 2050” from 2014. The report analyses the technical and economic feasibility of an energy supply system independent of fossil fuels in 2050, depending on the choice of green energy system. 

Long-term planning and scenario analyses in the energy sector is an integrated part of the ‘Danish model’, and provides a solid base for discussing technical and economic solutions for integrating  large shares of renewable energy.

A holistic tool

Model based scenarios should not be seen as forecasts, but rather as narratives of politics, technology and economy to show challenges and possibilities from different pathways. Traditionally, every energy subsector, such as the electricity sector, has specific tools for calculating scenarios. Recognizing the connections between the energy subsectors is essential in making the energy transition. DEA notices the importance of developing holistic models in which the energy sectors can be optimized concurrently. In DEA’s cooperation with various emerging economies it has proven useful to integrate all energy sectors in the scenario analyses, with comprehensive tools for long-term policy-making on development of energy systems as outcome. 

The Chinese case

DEA’s cooperation with the Chinese government is the most extensive country cooperation on the use of scenarios, and the experiences from China show significant potential for setting up similar scenario initiatives in other emerging economies. China has ambitious targets for the future use of renewable energy.  Along with Danish experts, China National Renewable Energy Centre (CNREC) has developed scenarios demonstrating that China can increase its share of renewable energy significantly. One of the main conclusions of the scenario study is that renewable energy expansion is cost-effective and that China could get as much as 85% of electricity and 60% of total energy from renewables by 2050.

The initiatives of DEA in China have been strengthened by cooperating with Harvard University in studies on environmental externalities from energy production. The integration of the study, the energy models and the scenarios has provided important new insights on the socio-economic costs of air-pollution from the energy sector in China, and the reduction of mortality by enhancing the use of renewable energy. 

The successful initiative has been consolidated in the Boosting Renewable Energy in China Programme partly financed by Children Investment Fund Foundation (CIFF) together with CNREC, DEA, US National Renewable Energy Laboratory and Deutsche Gezellshaft for Internationale Zusammenarbeit.

Currently, DEA is assisting with similar model based scenario studies in Vietnam, Indonesia and Mexico.

Niels Bisgaard Pedersen
Advisor Centre for System Analysis, Energy Efficiency and Global Cooperation (+45) 2339 3666