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ENFA Model ENFA Kick-off Meeting Hamburg, 10 May 2005.

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Presentation on theme: "ENFA Model ENFA Kick-off Meeting Hamburg, 10 May 2005."— Presentation transcript:

1 ENFA Model ENFA Kick-off Meeting Hamburg, 10 May 2005

2 ENFA Model Simulates land use decisions in the EU agricultural and forest sectors Represents markets and computes market equilibrium Portrays trade on a global level Accounts for environmental impacts of land use decisions Spatially explicit, dynamic

3 Food Non-Food Biodiversity Land use competition

4 ENFA Model Structure Resources Land Use Technologies Processing Technologies ProductsMarkets Inputs Limits Supply Functions Limits Demand Functions, Trade

5 ENFA Optimization Model determines the "optimal" use to which each individual technology should be used in each region and time period Maximize welfare Obey restrictions Product prices are endogenous

6 ENFA Spatial Resolution Political regions (NUTS 2) Soil types Farm types Altitude levels Slopes

7 ENFA Dynamics 5 to 10 year steps from 2005 to 2030 (2100?) Technical progress Demand & industry growth Resource change Policy scenarios

8 Data Resource data –Climate, Soil, Water, Existing Forests, Population, Labor Technological data –Inputs / outputs for crop, livestock, forest management, and product processing and transportation options Market data –Observed prices, production, trade, and income levels –Supply Demand function parameters Environmental impact data –Emissions, Sequestration, Erosion, Biodiversity

9 ENFA Technologies Traditional agriculture –major crops –major livestock Forestry Non-food agriculture Processing (Wildlife preservation)

10 Non-market Impacts Greenhouse gas emissions Air, water, soil quality Income distribution Rural development / employment Wildlife

11 Simultaneity Technologies Non-Market Impacts Current and Potential Policies … resource competition … multiple impacts

12 Crop Technology Data Base RegionAltitudSoilFarmRotationWaterTillageFertilzResidueItemUnitValue Poland0-300SandES3W-W-SIrrigConv.Basic Wheatdt/ha/y50 Poland0-300SandES3W-W-SIrrigConv.Basic S-Beatdt/ha/y200 Poland0-300SandES3W-W-SIrrigConv.Basic Strawdt/ha/y50 Poland0-300SandES3W-W-SIrrigConv.Basic Laborhr/ha/y30 Poland0-300SandES3W-W-SIrrigConv.Basic Landha/ha/y1 Poland0-300SandES3W-W-SIrrigConv.Basic Diesell/ha/y40 Poland0-300SandES3W-W-SIrrigConv.Basic... Poland0-300SandES3W-W-SIrrigConv.Basic Soil-Ckg/ha/y50 Poland0-300SandES3W-W-SIrrigConv.Basic Erosionkg/ha/y15 Poland0-300SandES3W-W-SIrrigConv.Basic NO3-Lkg/ha/y20

13 Technology Adoption Non-Market Impacts OutputsInputs

14 Consistency Representative yields not maximum yields on experimental plots Representative input quantities on labor and energy intensive inputs Representative and complete variable costs on remaining inputs Environmental Impacts (from EPIC)

15 Technical Details Programmed in GAMS Non-linear functions are linearly approximated Solved with CPLEX Variables and equations are aggregated to blocks

16 Constrained Optimization

17 Objective Function

18 Resource Limits Limits exist on Land Water Family labor Public grazing land

19 Balance Equations

20 International Trade

21 Emission Accounts

22 Basic Results

23 Technology Potentials Measures of potential –Technical –Economic single strategy multiple strategy

24 U.S. Ag-Soil Carbon Potentials 0 100 200 300 400 500 020406080100120140160 Carbon price ($/tce) Soil carbon sequestration (mmtce) Technical Potential Economic Potential Competitive Economic Potential

25 U.S. Afforestation Potentials 0 100 200 300 400 500 050100150200250300 Carbon price ($/tce) Emission reduction (mmtce) Technical Potential Economic Potential Competitive Economic Potential

26 U.S. Biofuel Potentials 0 100 200 300 400 500 050100150200250300350 Carbon price ($/tce) Emission reduction (mmtce) Technical Potential Economic Potential Competitive Economic Potential

27 Land Allocation Carbon Tax Pasture Traditional Crops Biomass for Power Plants Afforestation

28 Energy Crop Area Subsidy Bioenergy use None 2010 Limit 2030 Limit 2050 Limit Unrestricted

29 A Simple Example

30 Constant Corn Price

31 Endogenous Corn Price 0 50 100 150 200 250 0 (1.80)25 (1.98)50 (2.16)100 (2.88) Carbon Price in $/tce (Corn price in $/bu) Revenue in $/Acre Rainfed CornIrrigated CornBiofuel

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