Targets IMage Energy Regional (TIMER) Model, Technical ...

page 78 of 188 RIVM report 461502024
of underground and surface coal, UCCost and SCCost, the Average Coal Cost ACC is
determined as a weighted average.
The next step is to incorporate the capital requirements and resulting add-on costs for transport
and upgrading of coal. This is modelled in a very simple way in the form of a fixed multiplier
Coal Processing Factor CPF. Conversion losses e.g. due to assumed gasification/ liquefaction
schemes, can be accounted for by this same factor. It is assumed that 90% of these additional
costs are in the form of annuity payments for investments.
The resulting domestic price of coal depends on the weighed average of underground- and
surface-mined coal, a Desired Gross Margin DGM, an overhead factor set at 1.1 and
PriceCapacityUtilMult PCUM which increases nonlinearly above one if demand exceeds
capacity and reflects the difference between a ‘buyers market’ and a ‘sellers market’. This
results in:
⎡ &RDO'HP
'RP& Pr LFH (1 '*0 ) *1.1* 3&80
*&3)
* $&&
&3&
XQG , U
&3&
VXUI , U ⎥ ⎥ ⎤
= +
⎢
⎢⎣
+ ⎦
$/GJ (5.11)
with CPC the Coal Producing Capacity and ACC the Average Coal Cost. The value of DGM is
set at 1.3 to 1.4, representing an industry average marking up rate. The additional factor 1.1
represents additional costs; in future work we hope to expand this factor to include explicitly
processes related to coal washing, environmental and safety measures etc.
As described in the beginning of this chapter, in case the domestic coal price DCP is higher
than the price of imported coal from other regions, part of the demand will be met by imports.
The resulting market price is defined as the market share of imports and domestic production
times their respective prices.
7UDGLWLRQDOIXHOPRGHOLPSOHPHQWDWLRQDQGPRGHOFDOLEUDWLRQ
Based on historical calibration the following values are used within the traditional fuel
formulation for 1995 (cf. Eqn. 5.1 and 5.2). In all regions, a minimum traditional biofuel
consumption of 0.3 GJ per capita is assumed (except for Japan). The influence of changes in
the prices of alternatives (oil) is assumed to be very small. The model equations are only used
from 1995 onwards – until 1995 the model simply uses scenario files.
)LJXUH shows the results for one scenario from 1995 onwards. In the 1971-1995, data
suggests that there might have been a small decline in per capita consumption of traditional
biofuels (due to substitution to commercial fuels). In our current model setting, this trend is
slightly accelerated after 1995. The trend seems, however, to be in line with the projections of
other modelling and scenario groups.