The Industrial Sectors Integrated Solutions ISIS Model 851 Overview

ISIS, a dynamic linear programming model, facilitates analyses of emission reduction strategies for multiple pollutants, while taking in to account plant-level economic and technical factors such as the type of kiln, associated capacity, location, cost of production, applicable controls, and their costs. ISIS' design allows for incorporating representations of multiple industries within a multi-market, multi-product, multi-pollutant, and multi-region modeling framework. For the emission-reduction strategies under consideration, the model has been designed to provide information on: (1) optimal (maximum profit) industry operation, (2) cost-effective controls to meet the demand for commodities produced by the sectors under consideration, and (3) the emission reductions achieved over the time period of interest.

ISIS has a modular architecture as shown in Fig. 8.5 below. Input data is organized in various spreadsheets of an Excel Workbook. As shown in Fig. 8.5, the inputs are transmitted to the optimization part of the ISIS model, where they are used to solve the selected Business-as-Usual (BAU) and policy cases. Potential policy options may include cap-and-trade, emissions taxes, or emissions limits as emission reduction mechanisms. After solving, the results are post-processed to

ISIS Model and Data Structure

Fluor Integrated Solutions Model

Model Outputs

• Base Case and Contra I led Emissions

• Barked Allowances ■Controls Installed

■ Production and Imports

• Commodity Prices

• Policy Total Cost

Model Outputs

• Base Case and Contra I led Emissions

• Barked Allowances ■Controls Installed

■ Production and Imports

• Commodity Prices

• Policy Total Cost

Fig. 8.5 Architecture of the ISIS model calculate values of various outputs of interest. The output data are exported to Excel spreadsheets for further analyses and graphical representations of selected results.

In the BAU case, the model minimizes the total discounted cost over the horizon of interest while meeting regional market demands, prescribed exogenously, for the applicable commodities. The default discount rate has been chosen to be 7%, as recommended by the U.S. Office of Management and Budget (OMB) for project evaluation [38]. In general, total cost includes the cost associated with operation of production units; cost of endogenous capacity changes resulting from installing new production capacity, replacing or expanding the existing capacity, and retiring or mothballing non-competitive existing units; cost of imports; and the cost associated with transporting the commodities to the pertinent markets.

While evaluating a potential policy option, ISIS maximizes the consumer and producer surplus2 to account for demand changes associated with price changes relative to the BAU case. An elastic formulation of the demand function is used to estimate the area under the demand curve. Demand for cement is relatively

2 The consumer surplus is the amount that consumers benefit by being able to purchase a product for a price that is less than the most that they would be willing to pay. The producer surplus is the amount that producers benefit by selling at a market price that is higher than the least that they would be willing to sell for.

Fig. 8.5 Architecture of the ISIS model inelastic and a value of -0.88 is used for the price elasticity of demand [39]. The total cost function is modified to also include the cost of installation and operation of emission reduction measures to meet the applicable emissions reduction requirements.

A detailed description of the ISIS model is available elsewhere [40].

Waste Management And Control

Waste Management And Control

Get All The Support And Guidance You Need To Be A Success At Understanding Waste Management. This Book Is One Of The Most Valuable Resources In The World When It Comes To The Truth about Environment, Waste and Landfills.

Get My Free Ebook


Post a comment