Dynamics of Energy Systems - Methods of analysing technology change

University dissertation from Environmental and Energy Systems Studies, Lund university

Abstract: Technology change will have a central role in achieving a sustainable energy system. This calls for methods of analysing the dynamics of energy systems in view of technology change and policy instruments for effecting and accelerating technology change. In this thesis, such methods have been developed, applied, and assessed. Two types of methods have been considered, methods of analysing and projecting the dynamics of future technology change and methods of evaluating policy instruments effecting technology change, i.e. market transformation programmes. Two methods are focused on analysing the dynamics of future technology change; vintage models and experience curves. Vintage models, which allow for complex analysis of annual streams of energy and technological investments, are applied to the analysis of the time dynamics of electricity demand for lighting and air-distribution in Sweden. The results of the analyses show that the Swedish electricity demand for these purposes could decrease over time, relative to a reference scenario, if policy instruments are used. Experience curves are used to provide insight into the prospects of diffusion of wind turbines and photo voltaic (PV) modules due to cost reduction. The results show potential for considerable cost reduction for wind-generated electricity, which, in turn, could lead to major diffusion of wind turbines. The results also show that major diffusion of PV modules, and a reduction of PV generated electricity down to the level of conventional base-load electricity, will depend on large investments in bringing the costs down (through RD&D, market incentives and investments in niche markets) or the introduction of new generations of PV modules (e.g. high-efficiency mass-produced thin-film cells). Moreover, a model has been developed for the evaluation of market transformation programmes, i.e. policy instruments that effect technology change and the introduction and commercialisation of energy-efficient technologies. The method of evaluation has been applied to assess methods used to evaluate Swedish market transformation programmes. The evaluation model, and the assessment of the Swedish evaluation methods, illustrates a need for more extensive evaluation methods than those used today.

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