Bridging macroeconomic and bottom up energy models - the case of efficiency in industry

Energy demand and supply projections for a country are generally based on one of two types of models: macroeconomic models or bottom-up models for several sectors. Both types of models are essential for future energy policy design and ex ante evaluation of energy and material efficiency strategies. However, both types have their strengths and limitations. The solution to this dilemma is to link both model types and run them iteratively in order to benefit from their strengths and advantages and avoid their limitations. This paper focuses on one essential element of a hybrid energy model system: the data transformation of industrial production data from a macroeconomic model to an industrial sectoral bottom up model of an existing hybrid energy model system. Making use of this 'transformation module', the information of the macro model is converted into physical units as input for the bottom-up models operating as a "hard-link" between the two model types. This paper reports on energy-intensive industries such as metal production, pulp, paper, and printing, or non-metallic minerals, taking into account material efficiency improvements as well as material substitution and, hence, this aspect of indirect energy efficiency improvements.