Development of Dynamic Multi-sector Energy Economic Model Elaborating Energy Sectors and Suggestions for Optimum Power Generation Mix in Japan in 2050

Abstract

This paper presents the progress of an energy economic model, named Dynamic Multi-Sector Energy Economic model (DMSEE) and suggests optimum power generation mix in Japan in 2050. This model is based on general equilibrium models maximizing utility function of consumptions, and elaborates electricity sector of energy sectors with very high time resolution. Therefore, this model is able to suggest the best solutions from both energy and economic viewpoints with considering relationship between them. According to calculation results, nuclear power, solar PV (Photovoltaics) and storage equipment play an important role for sustainable energy supply and reduction of carbon dioxide (CO₂). And, although increases of investment for such technology prompt growth of economy, social utility declines. Therefore, we need to be careful to introduce policy such as CO₂ emissions tax.