How to avoid winner-take-all

[guozhi1305]

Dear all,

I want to know how to avoid winner-take-all. The objective function of the TIMES model is cost optimization, which can impose market penetration or technology share constraints. However, for multiple technologies, if every process is set (such as the transportation sector), there may be some questions such as 1) Not every process can be constrained. And if we add too many constraints, it is the intervention to the model? In this case, imposing economic policies such as carbon tax may not work, because the cost caused by the imposed carbon tax is not high enough or due to the constraint. And if no constraint is set, the model may select the process according to their costs and resource endowment, and the use of suboptimal option only after the lowest cost is used up. How do you solve this problem in the modeling process? Whether the TIMES model can be linked with a discrete selection model similar to the GCAM model, and the market share can be calculated based on the cost.

Thank you!

Look forward to your reply!

Guo Zhi

[Antti-L]

> Whether the TIMES model can be linked with a discrete selection model similar to the GCAM model, and the market share can be calculated based on the cost.

Yes, sure it can.  Some TIMES models and the Markal SAGE algorithm implement market share algorithms comparable to the GCAM modified logit discrete choice model, see below:

   

As you can see, both the TIMES Ireland model and the Markal SAGE time-stepped algorithm implement market share algorithms that are resembling the GCAM Modified Logit formulation. The CIMS formulation adopted by TIMES Ireland differs from it by employing intangible costs instead of preference/calibration weights.

Years ago, it was suggested that the automated Markal SAGE market share algorithm be implemented also in TIMES, but thus far it has not been implemented. However, should there be general interest in such, it could be again considered, provided that the design for it is first reviewed for TIMES and improved where necessary.

In addition, I think one might also consider utilizing soft market share constraints instead of rigid ones, such that increasing/decreasing the market shares from the predefined bounds would be possible with some additional cost, or cost curves. For example, a high carbon tax would thereby be able to realize some additional shifts in technology market shares, beyond the default bounds.

[guozhi1305]

Thanks for your reply. That is, we can fix or UP（LO） to limit the share of process based on their costs, is it right? And when levying the carbon tax, the cost of process which emitting carbon emission will be changed, and then we should fix the share of process again based on their cost? Here is the question, when setting the carbon emission, how to decide the share?
Anna

[guozhi1305]

> Whether the TIMES model can be linked with a discrete selection model similar to the GCAM model, and the market share can be calculated based on the cost.

Yes, sure it can.  Some TIMES models and the Markal SAGE algorithm implement market share algorithms comparable to the GCAM modified logit discrete choice model, see below:



As you can see, both the TIMES Ireland model and the Markal SAGE time-stepped algorithm implement market share algorithms that are resembling the GCAM Modified Logit formulation. The CIMS formulation adopted by TIMES Ireland differs from it by employing intangible costs instead of preference/calibration weights.

Years ago, it was suggested that the automated Markal SAGE market share algorithm be implemented also in TIMES, but thus far it has not been implemented. However, should there be general interest in such, it could be again considered, provided that the design for it is first reviewed for TIMES and improved where necessary.

In addition, I think one might also consider utilizing soft market share constraints instead of rigid ones, such that increasing/decreasing the market shares from the predefined bounds would be possible with some additional cost, or cost curves. For example, a high carbon tax would thereby be able to realize some additional shifts in technology market shares, beyond the default bounds.

[Antti-L]

If you use one of such Logit approaches, it would be the heterogeneity (γ) and  preference weight (α) parameters that you should decide, where the preference weights are mainly for calibration, and heterogeneity describes the sensitivity of choice to the cost differences.

[Lukas255]

Greetings to all,

I would like to ask whether there has been developed any documentation using previously mentioned Logit approach in TIMES.
My goal is to implement Logit approach to our currently used Czech TIMES model.

If not, could you recommend what steps need to be undertaken (code adjustments) for ensuring proper function of TIMES including Logit.

Thank you for your reply!
Lukas

[Antti-L]

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