The Potential Impact of Industrial Energy Savings on The New Zealand Economy

Milad Maralani, Milad Maralani, Basil Sharp and Golbon Zakeri

No 9308, EcoMod2016 from EcoMod

Abstract: In New Zealand approximately 39% of electricity is consumed by large industries. In 2012, The University of Auckland engineering team proposed to develop novel heat exchanger technology to allow electricity demand shaving and load shifting in light metal industries. This technology provides significant cost savings for such companies and preserves generation capacity at peak times for other users. The aim of this study is to represent the impact of adopting this technology in a particular, electricity intensive sector (e.g. steel or light metals manufacturing), on the electricity market and economic system as a whole. New Zealand’s economy is represented as a static CGE model, and the electricity sector is represented by a bottom-up model. An iterative algorithm settles the quantities and price between these two models; the general equilibrium sub-model uses the MCP format, and the electricity sector is based on optimization. Initial results show that a decrease in electricity demand by our targetted sector has an impact on some other sectors of the economy(e.g. manufacturing). Exports increase as a result of lower equilibrium prices for domestic intermediate goods. However, the domestic price of final products increased slightly as a result of more goods being exported.

Keywords: New Zealand; Energy and environmental policy; General equilibrium modeling (CGE) (search for similar items in EconPapers)
Date: 2016-07-04
New Economics Papers: this item is included in nep-cmp, nep-ene and nep-reg
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Persistent link: https://EconPapers.repec.org/RePEc:ekd:009007:9308

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