IVCOST in SubRes

[AnaisXi]

Hi all,

I am writing to share one small quesion about the IVCOST define in SubRes file for the newtech.

1. It seems for many times if we have newtech in use, the BASE tech will disappear. But there are still some stock capacity for Base tech what haven't been fully developed. To solve this, we tried to copy some tech in Newtech with the same efficiency level as the tech in BASE file, then they will be under use again.. Do I always should do this?

2. The reason to explain this, would be the newtech is always cheaper than the Base tech. Thus even if we set the same IVCOST in newtech, they are still cheaper. Does that mean, the IVCOST and VARCOST are defined at the Start year? We should discount the cost into Base year?

But when I check the Cost in VEDAView, the newtech cost seems already defined and discounted for Baseyear.So which year is the default for COST in the system? Hope I explain it clear. ^_^

Best!

Anais Xi

[AKanudia]

Not sure I fully understand your question, especially #2, but this might help:

It can easily happen that new technologies are so efficient that they replace the existing stock even if it means abandoning capacity. Possible measures:

1. Make sure that the existing and new technology EFF are based on consistent assumptions. There might be systemic or management factors that reduce EFF, which would reflect in the existing stock but not in new techs. You can improve the EFF of new techs gradually over time.

2. You can use hurdle rates (NCAP_DRATE) for the new techs. Decision makers may not work with the numbers normally used as global discount rates in our models.

3. Only for the near term (next ~5 years), you can put some upper bounds on penetration of new techs.

4. You can use AFA(LO) to force a minimum utilization of existing stock. But make sure that this number reduces quite quickly over time. Basically, any scenario that actually justifies abandoning capacity should have the freedom to do so.