Economic Modeling Tools

This page last reviewed June 2, 2010

 

The California Air Resources Board's Economics Program carries out a number of eocnomic studies to evaluate statewide economic impacts of climate change, air pollution, and energy use policies. The following economic models are frequently used. 
 

EDRAM

Environmental Dynamic Revenue Analysis Model (EDRAM), developed by the University of California, Berkeley researchers, is a computible general equalibrium (CGE) model specifically for the economy of California. As a nonlinear optimization model, EDRAM captures all the fundamental economic relationships among consumers, producers, and government in the competitive market. This model generally can be run in the General Algebraic Modeling System (GAMS) platform with a nonlinear programming solver such as CONOPT. The GAMS package and solvers can be purchased online from their developers.

 

E3 RES Calculator

The 33 percent RES Calculator (Calculator) was developed by Energy and Environmental Economics, Incorporated (E3).  It is a spreadsheet model based on information obtained from the California energy agencies, private consultants, stakeholders, and results obtained from the Renewable Energy Transmission Initiative (RETI) process.  The RES calculator examines the supply of renewable resources around the Western Energy Coordinating Council (WECC) and determines a portfolio of resources to meet California’s 33 percent renewable target in 2020.  The Calculator estimates the amount of electricity needed to meet demand in 2020 as well as the amount and type of renewable energy needed to meet a renewable goal in 2020.  Based on the renewable resource mix selected, the Calculator estimates the costs and revenue required to meet a renewable electricity target in 2020.

The RES Calculator (.zip file, 8,036 KB) assumes that, in most cases, new high-voltage transmission lines must be constructed to deliver new renewable energy to California’s largest load centers.  The cost of these lines is included as an annual cost, levelized over the life of the resource. The line cost is determined using an E3 transmission costing tool (.xls file, 2,001 KB).
 

Bill Impact Calculator

The RES Bill Impact Calculator (BIC) calculates the projected monthly bill impacts of 33% RES implementation in 2020 relative to a baseline bill that assumes no 33% RES implementation.  These bill impacts are calculated for residential customers, California Alternative Rates for Energy (CARE) customers (low income residential customers who qualify for the CARE discount) and small commercial customers. The monthly bills are calculated based on the projected revenue requirements from the RES Calculator, while the baseline revenue requirement assumes the high net load 20% RPS scenario. The bill impact model was developed collaboratively by the CPUC Energy Division and staff of the IOUs that are regulated by the CPUC.  This model does not estimate bill impacts for customers of the publically owned utilities (POUs).

There are three BICs (.zip file, 253 KB) that estimate the bill impact for the proposed 33 percent RES and the 33 percent RES Alternative that was analyzed in the Staff Report. To use the calculators, first go to the “Inputs” worksheet and enter “L” to estimate bill impacts for the low load scenario or “H” to estimate bill impacts for the high load scenario in the highlighted cell. Press Enter. A summary of the estimated Bill Impacts for that calculator can be found on the worksheet labeled “Summary BI.”
 
 
 If you have any questions or comments regarding these economic modeling tools, please contact Fereidun Feizollahi, at (916) 323-1509.
     
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