A Critical Assessment of Energy - economy - climate Models for Policy Analysis

Energy-economy-climate models are used extensively in the policy debate to address issues on energy planning and climate mitigation scenarios. We present an overview of types of models commonly used in policy processes, and we analyze some of the main mechanisms in these models. For example, parameterization of aspects such as technology diffusion and intangible and transaction costs may have great importance for the results and the dynamics of the model. We also find that model comparison papers tend to offer little qualitative insight into the effect of different model approaches and mechanisms. Finally, an extensive sensitivity analysis and a skilled modeling team are of key importance for the usefulness of these kinds of models as policy input