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Disaggregating Electricity Generation Technologies in CGE Models

Listed author(s):
  • Vipin Arora
  • Yiyong Cai

We illustrate the importance of disaggregating electricity generation when considering responses to environmental policies. We begin by reviewing various approaches to electric sector modelling in Computable General Equilibrium (CGE) models, and then clarify and expand upon the structure and calibration of the “technology bundle” approach. We also simulate the proposed U.S. Clear Power Plan and show how a disaggregate electricity sector can change results. Our simulations indicate that both the ability to switch between generation technologies and the manner of aggregation in electricity production are important for quantifying the economic costs of the plan.

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File URL: https://cama.crawford.anu.edu.au/sites/default/files/publication/cama_crawford_anu_edu_au/2014-07/54_2014_arora_cai.pdf
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Paper provided by Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University in its series CAMA Working Papers with number 2014-54.

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Length: 29 pages
Date of creation: Jul 2014
Handle: RePEc:een:camaaa:2014-54
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