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Macroeconomic modelling and other modelling activities

For a two-year period starting in 2016, the European Commission undertook an encompassing study aimed to improve the understanding and modelling of the links between EU energy-related policies and macroeconomic dynamics, which resulted in ten reports:

  1. EU energy trends and macroeconomic performance (2016).
    Highlighting the main historical trends in the EU’s energy demand and supply and sets them in the context of wider global trends. It suggests priorities for macro-energy model development to improve analytical support for policy-makers in energy.
  2. Policy-induced energy technological innovation and finance for low-carbon economic growth (2016)
    Providing a review of policy-induced energy innovation and technological change and their likely macroeconomic implications for future low-carbon societies in the EU.
  3. Mapping of the current EU clean energy finance landscape (2017)
    Mapping the sources of finance and clean energy investment opportunities offered in the EU. It suggests how best to incorporate such findings in existing macroeconomic models.
  4. Case study on energy resilience and vulnerability (2017)
    Examining the resilience of the EU economy to energy supply shocks, and provides comparisons with six other global regions. The case study also presents the results of new econometric analysis of to what extent energy and other production factors, such as capital and labour, can compensate for each other (i.e. their substitutability) across EU sectors.
  5. Case study on technical analysis of capacity constraints and macroeconomic performance (2017)
    Analysing the influence of capacity constraints on the macroeconomic outcome of scenarios requiring significant additional investments compared to business-as-usual conditions.
  6. Case study on R&D and spillovers on clean energy technologies (2017)
    Elaborating on current and expected comparative advantages of clean energy EU industries and to test potential benefits for the EU from early action.
  7. Case study on assessing the impacts of selected EU policies promoting clean energy finance (2018)
    Examining the effect of recent EU policies put into operation to influence the European clean energy finance landscape and facilitate the clean energy transition.
  8. Report on a simulation model for technological change in the residential heating sector (2017)
    Introducing a new model for simulating Future Technology Transformations in the European residential heating sector, FTT:Heat. It simulates the uptake and replacement of heating technologies by households in all 28 EU Member States and assesses their macroeconomic implications.
  9. Report on a technical analysis on decarbonisation scenarios - constraints, economic implications and policies (2018)
    Applying two macro-sectoral global models to identify potential constraints on EU decarbonisation, the economic implications and potential stylised policies to address such constraints.
  10. Technical report on representing finance constraints in macroeconomic models (2017)
    Describing how to implement an explicit treatment of finance constraints for decarbonisation (and other) investments in a post-Keynesian macro-sectoral model

Other modelling activities

The Commission's Joint Research Centre (JRC) is developing an EU energy, transport and greenhouse gas emissions tool called POTEnCIA (Policy Oriented Tool for Energy and Climate Change Impact Assessment).

The JRC also produces a Global Energy and Climate Outlook, using the global energy model POLES-JRC.

The Commission also promotes new modelling approaches via its Horizon 2020 programme, including SET-NAV, REEEM, REFLEX and MEDEAS.